Best Buy, Dollar General and Dollar Tree All Raised Full-Year Guidance — and Tariff Refunds Are Inside Two of the Three Margin Stories

by Bisi Oyelaran · August 28, 2026

Equities Reporter, US Market Current

Three large US retailers reported quarterly results on Thursday, August 27, and all three lifted their full-year outlooks. Beneath the beats sits a line item that deserves separate attention: net tariff refunds, which materially flattered at least one of the three margin stories and contributed to another.

Dollar Tree: $1.31 of $2.70 came from refunds

Dollar Tree said in its August 27 results release that second-quarter net sales rose 7.0 percent to $4.9 billion, with comparable store net sales up 3.7 percent, split between a 3.3 percent increase in average ticket and a 0.4 percent increase in traffic.

The margin figures are arresting on their face. Gross profit margin expanded 850 basis points to 42.9 percent, operating income was $690 million, and operating income margin expanded 900 basis points to 14.1 percent. Diluted earnings per share from continuing operations and adjusted diluted earnings per share were both $2.70.

The company disclosed in the same release that diluted earnings per share of $2.70 included "a $1.31 benefit related to the net impact of tariff refunds," and that the 900-basis-point operating margin expansion included "a 650 basis point benefit related to the net impact of tariff refunds." On the company's own figures the refund benefit accounts for roughly 48 percent of the quarter's per-share earnings. Dollar Tree's own full-year framing acknowledges the effect: the release describes it as "increasing fiscal 2026 adjusted EPS outlook to a range of $7.70 to $8.05," a range it said includes approximately $0.60 of tariff refund benefit.

The rest of the updated outlook puts net sales at $20.5 billion to $20.7 billion and comparable store net sales growth at 3 percent to 4 percent, with approximately 400 new store openings and 75 closings. Chief Executive Mike Creedon said in the release, "What continues to set Dollar Tree apart is our ability to deliver value, convenience, and the excitement of discovery all in one shopping trip."

Dollar General: traffic, not just ticket

Dollar General reported second-quarter net sales of $11.3 billion, up 5.2 percent year over year, with same-store sales up 3.5 percent, according to Chain Store Age's account of the results. The composition matters: customer traffic rose 2.0 percent and average transaction amount rose 1.5 percent, so more of the comparable-sales gain came from additional visits than from bigger baskets.

Chain Store Age reported gross profit margin of 32.6 percent, up 127 basis points from 31.3 percent, net income of $550.3 million against $411.4 million a year earlier, and diluted earnings per share of $2.48 against $1.86. It said the company logged its fifth consecutive quarter of customer traffic growth and its sixth consecutive quarter of positive comparable sales across all four merchandising categories - consumables, seasonal, home products and apparel - and ended the quarter with 21,148 stores. Chain Store Age rendered the company's own attribution for the margin gain as "primarily attributable to tariff refunds, a lower LIFO provision and lower distribution costs, partially offset by increased markdowns and increased transportation costs."

24/7 Wall St., covering the same release, put operating profit at $769.2 million, up 29.2 percent, and reported a $700 million share repurchase authorization for the back half of the year and a quarterly dividend of $0.59 per share. Its summary of the margin drivers differs from Chain Store Age's on one item: 24/7 lists lower shrink where Chain Store Age's fuller account cites a lower LIFO provision. The company's stated attribution as reported by Chain Store Age is the version used above.

The raised guidance, per Chain Store Age, moves net sales growth to 4.0 percent to 4.3 percent from 3.7 percent to 4.2 percent, same-store sales growth to 2.5 percent to 2.9 percent from 2.2 percent to 2.7 percent, and diluted earnings per share to $7.80 to $8.00 from $7.20 to $7.45. Chief Executive Todd Vasos said, "This broad-based performance reflects the strength of our unique combination of value and convenience and the important role Dollar General plays in the communities we serve."

Best Buy: the computing replacement cycle

Best Buy's fiscal second-quarter revenue was $9.78 billion, up 3.6 percent year over year, with adjusted earnings per share of $1.48 against $0.87 a year earlier, according to a Zacks analysis carried by TradingView. Enterprise comparable sales rose 4.1 percent, against 1.6 percent in the prior-year quarter, and domestic comparable sales rose 4.5 percent against 1.1 percent.

The category detail in that analysis shows where the strength sat. Computing and mobile phones comps rose 6.8 percent, consumer electronics 5.6 percent — a swing from a 5.2 percent decline a year earlier — and services 6.4 percent. Appliances were essentially flat at 0.2 percent, a recovery from a 9.2 percent drop, while entertainment fell 6.3 percent against a 39.3 percent gain in the year-ago period.

Consolidated gross margin was 23.9 percent, up from 23.2 percent, with operating income of $421 million against $251 million and an operating margin of 4.3 percent against 2.7 percent, per the same analysis.

Best Buy's revised full-year fiscal 2027 guidance, as reported by Zacks, lifts revenue to a range of $42.3 billion to $42.8 billion from $41.2 billion to $42.1 billion, comparable sales growth to 1.9 percent to 3 percent from a prior range of negative 1 percent to positive 1 percent, the adjusted operating income rate to 4.4 percent to 4.5 percent from 4.3 percent to 4.4 percent, and adjusted earnings per share to $6.70 to $6.90 from $6.30 to $6.60.

How the two dollar stores traded

24/7 Wall St. reported that on August 27 Dollar General shares were up 5 percent at $128.90 while Dollar Tree shares were down 3 percent at $128.76. That piece was published at 1:17 p.m. Eastern on Thursday, while the session was still running, so those are intraday levels rather than Thursday's closing prices. Friday's session was also still under way at the time of writing, and no closing price for August 28 exists yet.

For the broader tape on the day these numbers landed, the Associated Press tally of Thursday's session put the S&P 500 at 7,730.99, up 0.7 percent, and the Russell 2000 at 3,014.34, up 0.3 percent.

The common thread across the three reports is worth stating plainly rather than extrapolating from: two of the three companies identified tariff refunds as a contributor to reported profitability, and one of them quantified the effect at roughly half its quarterly earnings per share. Readers comparing these margin expansions with prior-year periods should account for that disclosure.