(Reuters) -Discount store operator Dollar Tree (NASDAQ:DLTR) cut annual forecasts on Wednesday, as it struggled to lure in price-sensitive shoppers for its more profitable higher-margin goods amid sticky inflation, sending shares down about 9% in premarket trading.
Peer Dollar General (NYSE:DG) also cut its annual forecasts after its quarterly sales came below expectations, signaling strained spending from lower-income customers as well as value-seeking behavior from middle and higher-income households.
Dollar stores have struggled to attract shoppers as bigger rivals such as Walmart (NYSE:WMT), Target and PDD Holding’s ecommerce platform Temu compete for customers.
Chesapeake, Virginia-based Dollar Tree expects annual sales between $30.6 billion and $30.9 billion, compared with its prior forecast range of $31 billion to $32 billion.
The company sees annual adjusted earnings per share in the range of $5.20 to $5.60, compared with its prior forecast range of $6.50 to $7 per share.