4Q24 Revenue: $5.0B, -42.1% YoY, miss estimates by $3.23M
4Q24 Non-GAAP EPS: $2.11, miss estimates by $0.09
1Q25 Guidance: Expect net sales to be between $4.5bn to $4.6bn, midpoint of $4.55bn below consensus of $7.86bn; Expect adjusted EPS to be between $1.10 to $1.25, below consensus of $1.48.
FY25 Guidance: Expect net sales to be between $18.5bn to $19.1bn, midpoint of $18.8bn below consensus of $32.01bn; Expect adjusted EPS to be between $5.0 to $5.5, midpoint of $5.25 below consensus of $5.96.
Comment: Dollar Tree reported disappointing results and issued a weaker-than-expected outlook for annual sales and profit, citing increased consumer trade-down to lower-cost goods. The company noted that lower-income consumers are struggling to afford essentials, adding to consumption headwinds amid economic uncertainty and elevated interest rates. Additionally, management expects the newly imposed tariffs by President Donald Trump on Canada, China, and Mexico (effective March) to weigh on profitability, with an estimated impact of approximately $20 million per month. In a strategic move, Dollar Tree announced the sale of its struggling Family Dollar business to a private equity consortium for about $1 billion, concluding a nearly year-long effort to divest the discount chain, which has faced mounting competition from big-box and e-commerce retailers. 1Q25recommended trading range: $62 to $76. Neutral Outlook.
4Q24 Revenue: $3.25B, +14.9% YoY, beat estimates by $50M
4Q24 Non-GAAP EPS: $0.28, beat estimates by $0.08
1Q25 Guidance: Expect net sales to be between $3.06bn to $3.09bn, midpoint of $3.075bn above consensus of $3.04bn; Expect adjusted EPS to be between $0.30 to $0.35, midpoint of $0.325 below consensus of $0.33.
FY25 Guidance: Expect net sales to be between $12.3bn to $12.45bn, midpoint of $12.375 below consensus of $12.43bn; Expect adjusted EBITDA margin to be between 5.4% to 5.7%.
Comment: Chewy delivered stronger-than-expected earnings, driven by robust customer growth. In FY24, the company added 431,000 net new active customers, bringing its total to 20.5mn, up from 20.1mn the previous year. Net sales per active customer rose to $578 from $555. Management noted that both top-line growth and profitability exceeded the high end of guidance for 4Q24 and FY24, supported by strong customer acquisition and sustained Autoship loyalty. Despite economic uncertainty, Chewy demonstrated resilience, benefiting from steady demand for its products. 1Q25recommended trading range: $30 to $39. Positive Outlook.
