10-K 0000935703-26-000025 (2026-03-16) vs 10-K 0000935703-25-000015 (2025-03-26)
| Section | Compared text | Words now | Changed |
|---|
| Risk Factors | Item 1A | 10,961 |
29.7% |
| MD&A | Item 7 | 6,120 |
43.5% |
| Legal Proceedings | Item 3, via Note 5 – Commitments and Contingencies | 0 |
not compared |
| Accounting Policies | Item 8, Note 2 – Summary of Significant Accounting Policies | 0 |
not compared |
The redline: what was cut and what was added
In each section, the paragraph that changed most, marked against last year's 10-K:
cut words struck through, new words highlighted and underlined.
Risk Factors 237 words changed in this paragraph; it is 39% similar to last year's version.
Among our foreign suppliers, China is the source of the majority of our direct imports. In early 2025, the United States imposed or threatened to impose significant additional tariffs, including reciprocal tariffs, on China, Mexico, Canada and other countries from which we import goods. In addition, the Trump administration has announced plans to impose significant fees on Chinese shipping companies and any Chinese-built vessels that enter U.S. ports. The imposition of these or other additional tariffs on imported merchandise or other actions against China or other countries from which we import goods, and any retaliatory actions or other responses by such countries, could negatively impact product availability or impair our ability to meet customer demand and could result in lost sales, an increase in our cost of merchandise or other adverse impacts on our operations, unless we are able to successfully offset or mitigate these impacts. Our We have actively implemented mitigation efforts could include negotiating lower product costs, rebates or invoice deductions; shifting supply sources to alternate countries; changing our product assortment or discontinuing certain items; or increasing our prices. Even if we are able to mitigate the impact of tariffs in the short-term through one or more of the foregoing actions, a change in product assortment, reduced product offering or increase in pricing could reduce the competitiveness of our products, particularly if our competitors do not keep pace with any such changes or are able strategies to offset the impact of tariffs through and other actions. cost pressures by re-negotiating supplier terms, re-engineering products for efficiency, shifting country of origin where it adds advantage, discontinuing lower-margin or underperforming items and executing targeted retail price changes. We experienced increased costs during fiscal 2025 related to the implementation of these mitigation strategies, including significant labor and other discrete costs related to price changes, and our results could continue to be negatively impacted by tariffs
Source: Item 1A, 10-K 0000935703-26-000025 vs Item 1A, 10-K 0000935703-25-000015
MD&A 150 words changed in this paragraph; it is 44% similar to last year's version.
Gross profit margin remained unchanged increased in fiscal 2024 as the 2025 due to a 60 basis point decrease in cost of sales. The cost of sales rate is decreased to 63.6% in fiscal 2025 from 64.2% in both fiscal 2024 primarily due to improved mark-on from pricing initiatives, lower domestic and 2023. Changes in the cost of sales rates consist of lower import freight costs, offset by favorable sales mix resulting from increased sales of higher cost consumable merchandise, increased margin discretionary merchandise as a percentage of net sales, and lower occupancy costs resulting from the loss of due to leverage from the low single-digit comparable store net sales increase and the 53rd week of sales in 2023, increase, partially offset by higher distribution tariff costs, increased shrink costs resulting from unfavorable inventory results, higher markdowns, higher shrink, and increased markdown distribution costs for slow moving items. expense. The higher markdowns in fiscal 2025 include a $56.0 million write-off of various slow-turning SKUs. This reflects actions taken related to our ongoing strategic initiative to increase shelf space productivity, as discussed within “Strategic Initiatives and Recent Developments” above. Included in freight costs for fiscal 2024 is $25.0 million of duties related to an anti-dumping case for paper plates imported in fiscal 2024.
Source: Item 7, 10-K 0000935703-26-000025 vs Item 7, 10-K 0000935703-25-000015
Every change, by type
Sentences and paragraphs of DLTR's Risk Factors and MD&A, 10-K 2026-03-16 against 10-K 2025-03-26.
Each links to the text at sec.gov.
Quiet changes are sentences kept from last year with one to four words changed, at least one of them a hedge, a modal or a qualifier
(may, could, will, not, significant, material…). A year or date rolling forward is not counted.
The full word list
adverse, adversely, all, although, anticipate, anticipates, any, approximately, believe, believes, can, cannot, certain, could, expect, expects, generally, however, if, intend, intends, largely, likely, many, material, materially, may, might, most, must, never, no, not, possible, primarily, probable, should, significant, significantly, some, substantial, substantially, unlikely, will, would
AddedRisk Factors
We continue to expand and refine our multi-price assortment to deliver a broader, more relevant offering while preserving our foundational value proposition. Although our multi-price assortment has grown, the majority of our products are priced at $1.25, and 85% of products in the average Dollar Tree store are currently priced at $2.00 or less, and we generally have fewer price bands for our goods than other retailers. Accordingly, we may not be able to adjust our prices to effectively offset cost increases while providing
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedRisk Factors
expected value. Further, raising the price points of merchandise could cause customers to buy fewer products and affect our competitive position with other retailers.
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedRisk Factors
Our ability to re-negotiate supplier terms, re-engineer products for efficiency, shift country of origin where it adds advantage or discontinue lower-margin or underperforming items, in addition to targeted retail price changes, in order to address a volatile cost environment is critical to maintaining our profitability levels. We can give no assurance that we will be able to successfully mitigate cost pressures, maintain our profitability and competitiveness and provide our customers with desirable merchandise and value that they expect in the future.
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedRisk Factors
Among our foreign suppliers, China is the source of the majority of our direct imports. In early 2025, the United States imposed a new tariff and trade policy, announcing significant additional tariffs on a wide variety of products originating from countries worldwide, including China, and other countries from which we import goods. Subsequently, there have been various updates and revisions to these tariffs and the United States’ tariff policy, with some tariffs delayed or temporarily paused as country-specific agreements have been negotiated with certain countries. On February 20, 2026, the Supreme Court ruled that certain of the tariffs imposed under the International Emergency Economic Powers Act (“IEEPA”) were unlawful. Following the Supreme Court’s decision, the United States imposed new, temporary tariffs on imports from all countries under Section 122 of the Trade Act of 1974 and could take action to invoke other laws to collect tariffs. While the company has taken action to preserve its rights, there remains substantial uncertainty regarding the impacts of this decision on the availability, timing, and amount of potential refunds, if any, for the invalidated tariffs, the scope and duration of newly announced tariffs, and the possibility of further additional or modified tariffs or retaliatory actions.
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedRisk Factors
The imposition of tariffs on imported merchandise or other actions against China or other countries from which we import goods, and any retaliatory actions or other responses by such countries, could negatively impact product availability or impair our ability to meet customer demand and could result in lost sales, an increase in our cost of merchandise or other adverse impacts on our operations, unless we are able to successfully offset or mitigate these impacts. We have actively implemented mitigation strategies to offset the impact of tariffs and other cost pressures by re-negotiating supplier terms, re-engineering products for efficiency, shifting country of origin where it adds advantage, discontinuing lower-margin or underperforming items and executing targeted retail price changes. We experienced increased costs during fiscal 2025 related to the implementation of these mitigation strategies, including significant labor and other discrete costs related to price changes, and our results could continue to be negatively impacted by tariffs
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedRisk Factors
and related measures in the future. We expect tariff volatility to persist in the near-term, and implementation costs associated with our mitigation strategies may continue to be experienced before the benefits from those efforts are expected to materialize. Further, there is no guarantee that we will be able to successfully mitigate the impact of tariffs through one or more of the foregoing strategies or that our customers will respond favorably to the implementation of these strategies. The competitiveness of our products could be reduced if our competitors are able to react quickly to changes in the tariff environment to increase the relative value of their products or are otherwise able to offset the impact of tariffs.
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedRisk Factors
These direct and indirect impacts and the collective interaction of tariffs and other related measures, our mitigation strategies and those of our competitors, our customers’ response and consumer behavior generally, and other factors, could have a material adverse effect on our business, financial condition and results of operations.
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedRisk Factors
Our sales and profitability are affected by our product assortment and customer response to the mix of products we sell.
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedRisk Factors
•Expanding and refining our multi-price assortment to deliver a broader, more relevant offering while preserving the foundational value proposition of Dollar Tree;
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedRisk Factors
•Managing costs with agility, including our strategies to mitigate tariffs and inflationary pressures, manage operating expenses, and reduce corporate SG&A as a percentage of sales;
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedRisk Factors
•Continuing new store growth, as well as improving store standards and operational consistency through refresh and renovation programs, shelf productivity optimization, and initiatives to elevate store execution and cleanliness;
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedRisk Factors
•Expanding and modernizing our distribution network, enhancing warehouse management systems, and improving our transportation systems; and
Read it in 10-K 2026-03-16 at sec.gov ↗
RemovedRisk Factors
In our Dollar Tree segment, we continue to expand our brand assortment at the $1.25 price point and our multi-price product assortment generally, which began with the introduction of $3 and $5 Dollar Tree Plus product in select discretionary categories, expanded into $3, $4 and $5 frozen and refrigerated product, and now comprises a wide assortment of other consumable and discretionary product at varying price points. Although we have increased our price points at our Dollar Tree stores and expanded our multi-price assortment, we may not be able to adjust our prices to offset cost increases. Further, raising the price point of merchandise could cause customers to buy fewer products. As a result, our ability to adjust our product assortment, to operate more efficiently or to increase our comparable store net sales in order to offset cost increases is critical to maintaining our profitability levels. Further, supply chain constraints and higher commodity costs could make it more difficult for us to obtain sufficient quantities of certain products and could negatively affect our product assortment and merchandise costs. We can give no assurance that we will be able to adjust our product assortment, operate more efficiently or increase our comparable store net sales in the future. Please see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” for further discussion of the effect of economic factors on our operations.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedRisk Factors
Among our foreign suppliers, China is the source of the majority of our direct imports. In early 2025, the United States imposed or threatened to impose significant additional tariffs, including reciprocal tariffs, on China, Mexico, Canada and other countries from which we import goods. In addition, the Trump administration has announced plans to impose significant fees on Chinese shipping companies and any Chinese-built vessels that enter U.S. ports. The imposition of these or other additional tariffs on imported merchandise or other actions against China or other countries from which we import goods, and any retaliatory actions or other responses by such countries, could impair our ability to meet customer demand and could result in lost sales, an increase in our cost of merchandise or other adverse impacts on our operations, unless we are able to successfully offset or mitigate these impacts. Our mitigation efforts could include negotiating lower product costs, rebates or invoice deductions; shifting supply sources to alternate countries; changing our product assortment or discontinuing certain items; or increasing our prices. Even if we are able to mitigate the impact of tariffs in the short-term through one or more of the foregoing actions, a change in product assortment, reduced product offering or increase in pricing could reduce the competitiveness of our products, particularly if our competitors do not keep pace with any such changes or are able to offset the impact of tariffs through other actions.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedRisk Factors
Furthermore, in response to the recent tariffs announced by the United States, China and other countries have imposed or proposed additional tariffs on certain exports from the United States. These and any other retaliatory countermeasures imposed by countries subject to such tariffs, such as China, could increase our, or our vendors’, import expenses. Additionally, even if the products we import are not directly impacted by additional tariffs, the imposition of such additional tariffs on goods imported into the United States could cause increased prices for consumer goods in general, which could have a negative impact on consumer spending for discretionary items reducing demand for our products. These direct and indirect impacts of increased tariffs or trade restrictions implemented by the United States, both individually and cumulatively, could have a material adverse effect on our business, financial condition and results of future operations.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedRisk Factors
Our growth is dependent on our ability to increase sales in existing stores and to expand our square footage profitably.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedRisk Factors
In addition, we have entered into an agreement to sell the Family Dollar business. For more information, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Note 15 to our consolidated financial statements. If that sale is completed, our future growth and operating results will be dependent on our ability to increase sales and profitability in our Dollar Tree stores.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedRisk Factors
Our gross profit margin decreases when we increase the proportion of higher cost goods we sell. For example, some of our consumable products carry higher costs than other goods, so our gross profit margin will be negatively impacted as the percentage of our sales from higher cost consumable products increases. Imported merchandise and private label goods generally carry lower costs than domestic goods. Our product mix is affected by the supply of goods, including imported goods, and could be negatively impacted
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedRisk Factors
Risks Relating to Strategic Initiatives and the Pending Sale of the Family Dollar Business
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedRisk Factors
•We continue to expand our Dollar Tree brand assortment at the $1.25 price point and expand our multi-price product assortment, which now comprises a wide assortment of consumable and discretionary product at varying price points.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedRisk Factors
•We secured the leases for 164 former 99 Cents Only Stores across Arizona, California, Nevada and Texas and opened those stores under our Dollar Tree segment. More recently we have acquired designation rights for approximately 138 Party City stores and as we complete our diligence on this group of stores, we intend to designate acceptable stores and open these as Dollar Tree segment stores.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedRisk Factors
•We have initiatives to provide competitive pay and benefits, enhanced training, and other projects to support our workforce as well as initiatives to optimize and modernize our stores. Our supply chain initiatives include optimizing our transportation network and distribution methods.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedRisk Factors
•We continue our significant investments in our technology across our business, including our mobile apps, store systems, merchandising and supply chain.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedRisk Factors
In addition, we have been executing on a number of strategic initiatives in our Family Dollar banner, culminating with our agreement in March 2025 to sell the Family Dollar business. For more information about the impacts of the sale of Family Dollar, please see “The completion of the pending sale of the Family Dollar business is subject to various risks and uncertainties, may not be completed in a timely fashion or at all, and the pending sale may be disruptive to our business operations and adversely affect our profitability” and “If the pending sale of the Family Dollar business is completed, we may not achieve the anticipated benefits of the transaction, and the transaction may expose us to new risks” below.
Read it in 10-K 2025-03-26 at sec.gov ↗
RewordedRisk Factors
Further, we expect This has required, and could continue to have continuing obligations to Family Dollar pursuant to transition services or other agreements in connection with the sale of the Family Dollar business, which could require require, significant management and operational resources or which could reduce our ability to fully realize cost savings and efficiency initiatives that we would otherwise be able to implement following such a disposition. implement.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedRisk Factors
These factors, some of which may be beyond our control, include the perceived prospects and actual results of operations of our business; changes in estimates of our results of operations by analysts, investors or us; trading activity by our large shareholders; trading activity by sophisticated algorithms (high-frequency trading); speculation about our business in the press or the investment community; investor perceptions of the retail industry or us; our actual results of operations relative to estimates or expectations; actions or announcements by us or our competitors; litigation and judicial decisions; legislative or regulatory actions or changes; geopolitical tensions or major catastrophic events; inflation, monetary policy and changes in general economic or market conditions. conditions affecting the retail industry or the economy generally.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedRisk Factors
If However, if our sales price that is too high, value proposition does not meet customer expectations or we do not provide a selection of popular merchandising items, merchandise that is attractive to our customers, our products will be less attractive desirable to our customers and our traffic and sales could suffer.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedRisk Factors
The We have experienced in recent years, and could continue to experience, difficulties in sourcing adequate truck driver shortage also required drivers, which could increase our costs or require us to increase our use of more expensive surge carriers to transport our merchandise.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedRisk Factors
Our ability to effectively compete will depend upon our ability to successfully develop and execute on our strategic initiatives. initiatives and to anticipate or respond effectively to competitive pressures, industry changes that may include mergers and acquisitions, technological advancements and changing customer preferences and shopping habits.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedRisk Factors
Any of the foregoing could have a material adverse effect on our business, business or results of operations, financial conditions and cash flows, and we cannot assure you that the Dollar Tree banner, as an independent company, will be successful. operations.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedRisk Factors
Our success is dependent on our ability to import or transport merchandise to our distribution centers and store, pick and ship deliver merchandise to our stores in a safe, timely and cost-effective manner, and we are relying on a number of initiatives to improve upon our logistics execution, including new management systems. manner.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedRisk Factors
In fiscal 2024, Over the past several years, we continued to experience have experienced a material shift in consumer purchasing from higher-margin discretionary merchandise to lower-margin consumable goods, and we expect this trend could continue in 2025. goods.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedRisk Factors
In addition, our credibility and reputation within the business community and with our customers may be affected, which could result in our customers discontinuing the use of debit or credit cards in our stores or not shopping in our stores altogether.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedRisk Factors
We recently have experienced capacity pressure in To support our distribution network and growth initiatives, we are working to expand our distribution center capacity, including to replace that lost with following the 2024 tornado that destroyed our Marietta, Oklahoma distribution center.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedRisk Factors
Existing store Our ability to drive traffic and increase sales growth in our existing stores is critical to good operating results our success and is dependent on a variety of factors, including merchandise quality, assortment, price, relevance and availability, marketing efforts, store operations and customer satisfaction.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedRisk Factors
Tensions in the Persian Gulf and Red Sea and traffic restrictions through the Panama Canal caused global supply chain disruptions in recent years and may continue, which which, along with ongoing conflicts in the Middle East, could increase ocean shipping costs costs, transit times and transit times. port congestion.
Read it in 10-K 2026-03-16 at sec.gov ↗
Quiet changesRisk Factors
While we anticipate are receiving payment for the transition services that we provide, we may not be able to recoup all of the underlying costs.
Read it in 10-K 2026-03-16 at sec.gov ↗
Quiet changesRisk Factors
We have incurred could incur losses due to impairment of goodwill and other long-lived assets.
Read it in 10-K 2026-03-16 at sec.gov ↗
Quiet changesRisk Factors
Adverse Negative reputational incidents could impact the value of our brand, the cost of our operations and relationships with associates, customers or investors, all of which could adversely affect our business and results.
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedMD&A
This section of Form 10-K generally discusses fiscal 2025 and fiscal 2024 events and results, and year-to-year comparisons between fiscal 2025 and fiscal 2024. Discussions of fiscal 2023 items and year-to-year comparisons between fiscal 2024 and fiscal 2023 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended February 1, 2025.
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedMD&A
•Transition services agreement income, net was $54.9 million resulting from services provided to Family Dollar following the sale.
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedMD&A
•The effective tax rate was 24.8%, an increase of 10 basis points as compared to the prior year.
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedMD&A
Year Ended January 31, 2026 February 1, 2025 February 3, 2024 Sales Growth 5.3% 1.8% 5.8% Change in Customer Traffic 1.0% 1.6% 7.4% Change in Average Ticket 4.3% 0.1% (1.5)%
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedMD&A
We continue to execute on strategic initiatives to accelerate profitable growth for Dollar Tree as a standalone banner following the sale of Family Dollar. At our 2025 Investor Day held on October 15, 2025, we outlined our strategic plan that will help drive profitable sales growth: (i) expanding and enhancing our product assortment, (ii) managing costs with agility and discipline, (iii) strengthening our customer connection through data-driven marketing and other initiatives, (iv) opening new stores and improving store conditions, and (v) improving store operations and consistent execution to enhance the experience for our customers and our associates – all supported by supply chain enhancements, disciplined financial management, technology and investment in our people.
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedMD&A
Expanded and Enhanced Assortment. A central pillar of our strategy is expanding and refining our multi-price assortment to deliver a broader, more relevant offering while preserving our foundational value proposition. Our multi-price strategy is designed to increase basket size and drive margin expansion by introducing complementary products, new categories, larger pack sizes, and select branded and licensed items that we could not historically offer under a single price point. As of January 31, 2026, we carried our expanded multi-price assortment in the majority of our stores. We are also expanding customer access through digital and delivery partnerships. In August 2025, we announced a nationwide partnership with Uber to bring the Uber Eats platform to our stores. As of January 31, 2026, over 8,800 Dollar Tree stores were serviceable through Uber Eats.
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedMD&A
Agile Cost Management. We are implementing cost management strategies designed to mitigate cost pressures both in how we buy and distribute our products as well as the selling, general and administrative costs to support the business. Our merchandising approach includes five primary levers: renegotiating supplier terms, re-engineering products for efficiency, shifting country of origin where advantageous, discontinuing lower-margin or underperforming items, and executing targeted retail price adjustments when appropriate.
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedMD&A
During fiscal 2025, the volatile tariff environment and the implementation of these mitigation strategies resulted in increased costs, including significant labor and other discrete costs related to price adjustments, which also impacted our net sales. The tariff environment remains fluid, and we expect our results to continue to be impacted by near-term challenges, potentially including higher costs due to increases or variability in tariffs. Further, we may experience implementation costs associated with our mitigation strategies that impact us before the benefits from those efforts are expected to materialize.
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedMD&A
On February 20, 2026, the U.S. Supreme Court ruled that certain of the tariffs imposed last year under the International Emergency Economic Powers Act (“IEEPA”) were unlawful. We are taking action to preserve our rights to refunds for these IEEPA tariffs, but the availability, timing, and amount of any potential refunds remains highly uncertain and subject to further legal, regulatory, and administrative developments. Following the Supreme Court’s decision, the United States imposed new, temporary tariffs on imports from all countries under section 122 of the Trade Act of 1974 and could take action to invoke other laws to collect additional tariffs. There remains substantial uncertainty regarding the impacts of this decision on existing tariffs, the scope and duration of any newly announced tariffs, and the possibility of further additional or modified tariffs or retaliatory actions. As a result, our margins and operating results could vary significantly.
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedMD&A
Beyond addressing the cost of goods sold, our strategy includes disciplined management of operating expenses. Following the sale of Family Dollar, we are reshaping our organization to align with the needs of the standalone Dollar Tree business, with a focus on operating leverage and scalable profitability. Our long-term objective includes reducing corporate selling, general and administrative expenses as a percentage of net sales through improved productivity, cost optimization, and right-sizing initiatives.
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedMD&A
New Store Growth and Improved Conditions. We continue to expand our store footprint while investing to modernize and optimize our fleet. We operate more than 9,200 stores and believe we have ample opportunities for new store growth in the future, supported by disciplined site selection and capital allocation. Our modernization efforts include refresh and renovation programs, which are designed to improve the customer shopping experience.
Read it in 10-K 2026-03-16 at sec.gov ↗
AddedMD&A
Improved Store Operations. We are focused on improving store standards and operational consistency to enhance the in-store experience and optimize shelf productivity. These actions are intended to strengthen customer connection, increase traffic and basket size, and drive higher returns on invested capital.
Read it in 10-K 2026-03-16 at sec.gov ↗
RemovedMD&A
During fiscal 2024, the Family Dollar business met the held for sale and discontinued operations accounting criteria. Accordingly, the results of operations of the Family Dollar business are reported as discontinued operations in the accompanying Consolidated Statements of Operations for all periods presented and the related assets and liabilities are classified as assets and liabilities of discontinued operations in the accompanying Consolidated Balance Sheets. Unless otherwise noted, all amounts, percentages and discussions below reflect only the results of operations and financial condition of our continuing operations.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedMD&A
We are a leading operator of more than 8,800 retail discount stores, as of February 1, 2025, offering merchandise predominantly at the opening price point of $1.25, with additional offerings at higher price points.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedMD&A
We continue to execute on a number of strategic initiatives to drive productive sales growth, improve operating efficiency, invest in technology, and expand our culture of service to our associates. These initiatives include, among others, and in no particular order, the following:
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedMD&A
Dollar Tree Merchandising. We continue to expand our brand assortment at the $1.25 price point to provide greater value to our customers and increase customer traffic and store productivity. We are continuing to expand our multi-price product assortment, which began with the introduction of $3 and $5 products in select discretionary categories, expanded into $3, $4 and $5 frozen and refrigerated product, and now comprises a wide assortment of other consumable and discretionary product at varying price points. As of February 1, 2025, we had approximately 2,900 multi-price format stores, including approximately 2,600 conversions and 300 new stores.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedMD&A
99 Cents Only Stores Acquisition. During the second quarter of fiscal 2024, we acquired designation rights for up to 170 leases of 99 Cents Only Stores across Arizona, California, Nevada and Texas. The designation rights were acquired following the bankruptcy of 99 Cents Only Stores, which provided us an attractive opportunity to secure leases in priority markets. We secured the leases for 164 of these stores and substantially all have opened as Dollar Tree stores.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedMD&A
Our Workforce & Our Workplace. We are investing in our talent, including initiatives to provide competitive pay and benefits, enhanced training, and attractive career opportunities to deliver an enhanced associate experience, reduce turnover, and improve our store standards and efficiencies and ultimately the customer experience. Additional initiatives include projects to optimize and modernize our stores, with a focus on improving the in-store experience through renovations and customer service enhancements.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedMD&A
Supply Chain Optimization. Our supply chain initiatives include expanding and enhancing our distribution and transportation network, including investments in our truck fleet, transportation management systems, a new distribution center with enhanced automation to improve efficiency, and a new RotaCart delivery process to streamline the truck unloading and store delivery process. Significant investments are also underway to improve climate control conditions in our distribution centers. These investments are expected to negatively impact gross margin in the near-to-mid term.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedMD&A
Technology Investment. We continue our multi-year plan for significant investment in our technology across our business, including our mobile apps, human capital management system and supply chain system. We believe these improvements can promote operational efficiencies and deliver an elevated customer experience.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedMD&A
Marietta, Oklahoma Distribution Center. In the first quarter of fiscal 2024, a tornado destroyed our distribution center in Marietta, Oklahoma. Based on the significant damage sustained by the facility, the inventory contained in the facility and the facility itself are not salvageable. We have pivoted our supply chain network to deliver products to the approximately 600 Marietta-serviced stores, and we believe these efforts have limited and will continue to limit disruption to the Dollar Tree shopping experience. We are incurring additional costs within our supply chain as a result of servicing these impacted stores, including additional stem miles for delivered product and outside storage, and expect such costs to continue negatively impacting gross margin in the near-to-mid term.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedMD&A
General Liability Claims Development. Our self-insured general liability claims related to customer accidents and other incidents at our stores continue to develop unfavorably due to the rising costs to reimburse, settle, or litigate the claims. As a result, our actuarially determined liabilities were increased during the second quarter of fiscal 2024, contributing to a $45.3 million increase in our general liability claim expenses compared to the prior year second quarter. For the full year, fiscal 2024 general liability claim expenses increased $20.4 million compared to fiscal 2023.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedMD&A
The liabilities related to our self-insurance programs, which include general liability claims, are estimates that require judgment and the use of assumptions. See the “Critical Accounting Estimates and Assumptions” later in this “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” for more information on the estimates and assumptions related to these liabilities. Such estimates are inherently uncertain, and future changes in claim trends and assumptions could result in significant adjustments to our liabilities, which could materially and adversely affect our results of operations.
Read it in 10-K 2025-03-26 at sec.gov ↗
RemovedMD&A
Family Dollar Store Portfolio Optimization and Strategic Alternatives Reviews. During the fourth quarter of fiscal 2023, we announced that we had initiated a comprehensive store portfolio optimization review, which involved identifying stores for closure, relocation or re-bannering based on an evaluation of current market conditions and individual store performance, among other factors. As a result of the portfolio optimization review, we identified approximately 970 underperforming Family Dollar stores, including approximately 600 stores to be closed in the first half of fiscal 2024, and approximately 370 stores to be closed at the end of each store's current lease term. As of February 1, 2025, we had closed approximately 695 stores identified under the portfolio optimization review.
Read it in 10-K 2025-03-26 at sec.gov ↗
RewordedMD&A
Year Ended (in millions, except percentages) (dollars in millions) January 31, 2026 February 1, 2025 February 3, 2024 January 28, 2023 Revenues Net sales $ 19,395.7 $ 17,565.8 $ 16,770.3 $ 15,405.7 Other revenue 16.1 12.7 10.8 5.8 Total revenue 19,411.8 17,578.5 16,781.1 15,411.5 Expenses and other operating items Cost of sales 12,345.0 11,284.1 10,761.4 9,630.2 Selling, general and administrative expenses 5,468.6 4,832.4 4,245.2 3,682.0 Transition services agreement income, net 54.9 — — Operating income 1,653.1 1,462.0 1,774.5 2,099.3 Interest expense, net 85.5 107.5 112.5 127.2 Other (income) expense, net (61.9) (29.1) 0.1 0.4 Income from continuing operations before income taxes 1,629.5 1,383.6 1,661.9 1,971.7 Provision for income taxes 404.2 341.1 396.1 471.6 Income from continuing operations $ 1,225.3 $ 1,042.5 $ 1,265.8 $ 1,500.1 Gross profit margin 36.4 % 35.8 % 35.8 % 37.5 % Selling, general and administrative expense rate 28.2 % 27.5 % 25.3 % 23.9 % Operating income margin 8.5 % 8.3 % 10.6 % 13.6 % Interest expense, net as a percentage of total revenue 0.6 % 0.7 % 0.8 % Income from continuing operations before income taxes as a percentage of total revenue 8.4 % 7.9 % 9.9 % 12.8 % Effective tax rate 24.8 % 24.7 % 23.8 % 23.9 % Income from continuing operations as a percentage of total revenue 6.3 % 5.9 % 7.5 % 9.7 %
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedMD&A
Interest expense, net decreased $5.0 $22.0 million in fiscal 2024 2025 compared to the prior year, primarily due to the repayment of our $1.0 billion principal amount of 4.00% Senior Notes in the second quarter of fiscal 2025, and higher interest income on investments. investments, partially offset by higher borrowings of commercial paper.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedMD&A
Operating income margin decreased increased to 10.6% 8.5% in fiscal 2023 2025 compared to 13.6% 8.3% in fiscal 2022, 2024, resulting from the decrease increase in gross profit margin as described above, and an income from the transition services agreement with Family Dollar, partially offset by the increase in the selling, general and administrative expense rate.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedMD&A
As such, the results of Family Dollar are presented as discontinued operations in the accompanying Consolidated Statements of Operations for all periods presented and the assets and liabilities of Family Dollar have been reflected as assets and liabilities of discontinued operations in the accompanying Consolidated Balance Sheets for all periods presented.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedMD&A
As such, the results of Family Dollar are presented as discontinued operations in the accompanying Consolidated Statements of Operations for all periods presented and the The assets and liabilities of Family Dollar have been reflected as assets and liabilities of discontinued operations in the accompanying Consolidated Balance Sheets for all prior periods presented.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedMD&A
The Fiscal 2024 included higher stock compensation expense resulting from the accelerated vesting of the former Chief Executive Officer’s option award and software impairments and related contract termination costs totaled totaling $58.0 million and were related to enterprise merchandising and store system projects that were not fully implemented and were cancelled in connection with the decision to sell the Family Dollar business.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedMD&A
Our accrual for After physical inventory counts are taken, shrink is based on accruals at period end are estimated using the shrink overall enterprise-wide results of from our most recent physical inventories adjusted, if necessary, for current economic conditions and business trends.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedMD&A
Other commitments include letters of credit for imported merchandise, standby letters of credit that serve as collateral for our large-deductible insurance programs merchandise and surety bonds that serve as collateral for utility payments at our stores and self-insured insurance programs. programs, as well as U.S. customs compliance.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedMD&A
Comparable store net sales increased 1.8% 5.3% in fiscal 2024, 2025, as a result of a 1.6% 4.3% increase in average ticket and a 1.0% increase in customer traffic and a 0.1% increase in average ticket. traffic.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedMD&A
Fiscal 2022 2024 Selling, general and administrative expenses $ 5,468.6 $ 4,832.4 $ 4,245.2 $ 3,682.0 13.8% 15.3% expenses 13.2% Selling, general and administrative expense rate 28.2 % 27.5 % 25.3 % 23.9 % 2.2% 1.4% expense rate 0.7%
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedMD&A
We repurchased 3,283,837, 17,176,514, 3,283,837 and 3,905,599 and 4,613,696 shares of common stock on the open market at a cost of $1.6 billion, $403.6 million, $504.3 million and $647.5 $504.3 million, including applicable excise tax, in fiscal 2024, 2025, fiscal 2023 2024 and fiscal 2022, 2023, respectively.
Read it in 10-K 2026-03-16 at sec.gov ↗
RewordedMD&A
We Additionally, we determined the ultimate disposal will represent disposal, which took place on July 5, 2025, represented a strategic shift that will have had a major effect on our operations and financial results.
Read it in 10-K 2026-03-16 at sec.gov ↗
