Dollar Tree Reports Major Financial Downturn

Dollar Tree and Dollar General are facing significant financial challenges, with both companies reporting substantial declines in stock prices and slashing their earnings forecasts due to a downturn in consumer spending. Dollar Tree's shares dropped over 20%, the largest one-day sell-off in over two decades, after the company acknowledged that inflation and rising interest rates are impacting both low- and middle-income shoppers. Similarly, Dollar General's stock plummeted following its disappointing quarterly results, emphasizing that more than 60% of its sales come from households earning under $35,000, who are increasingly struggling to afford essentials. Analysts suggest that dollar stores, once considered recession-proof, are now losing market share to larger retailers like Walmart and Target, which are also cutting prices. Both companies are attempting to adapt by exploring multi-price formats and diversifying their product offerings, but the immediate outlook remains bleak as economic pressures weigh heavily on their customer bases.