The numbers were good. The outlook wasn't.
Dollar General reported Q4 net sales of $10.9 billion, up 5.9% year over year. Same-store sales rose 4.3%, driven by more customer visits and slightly larger basket sizes. Net income jumped 122.9% to $426 million, and EPS of $1.93 nearly doubled the $0.87 from the same quarter a year ago.
CEO Todd Vasos called out progress on shrink reduction — theft and inventory loss that had been a persistent problem — and said the company's Value Valley program, with over 500 rotating $1 items, posted 17.6% same-store sales growth.
For 2026, Dollar General guided for same-store sales growth of 2.2% to 2.7% — short of the 3% analysts were expecting. Full-year EPS guidance of $7.10 to $7.35 beat consensus, but the sales outlook was the number Wall Street focused on.
CFO Donny Lau flagged gas prices and tariffs as the main headwinds. That's not a small thing for Dollar General. Its core customer is rural, lower-income, and especially sensitive to what it costs to fill up the tank.
Gas is now averaging $3.57 per gallon nationally, up from around $3.15 before the Iran conflict began. For households earning $20,000 a year, every dollar at the pump hits hard. Management told analysts that "consumer sentiment does remain cautious and stagnant, and inflation remains sticky."
Dollar General isn't just a retail story — it's a real-time read on how lower-income America is holding up.
The company plans to open 450 new stores in 2026 and is targeting 6% to 7% operating margins by 2028. The long-term build is intact.
But right now, the people most likely to shop there are getting hit from every direction: gas, groceries, tariffs. The Q4 beat tells you what happened. The 2026 guide tells you what management is bracing for.