Shoppers are increasingly turning to dollar stores, including Dollar General Corp. (NYSE:DG), Dollar Tree, Inc. (NASDAQ:DLTR) and Five Below, Inc. (NASDAQ:FIVE), as economic uncertainty and inflation drive even higher-income households to stretch their budgets. 

What To Know: The shift became evident this week when leading discount retailers released better-than-expected earnings reports and sales growth across income levels. 

DLTR: Dollar Tree reported a robust first quarter, with same-store net sales up 5.4%, fueled by a 2.5% increase in traffic and a 2.8% rise in average ticket size. CEO Mike Creedon said Dollar Tree's low prices are resonating with all income levels and the company saw significant growth among customers earning over $100,000 annually. 

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“History has shown that we have the resilience to emerge stronger from periods of economic uncertainty and in today’s rapidly evolving environment, we see a meaningful opportunity to further elevate the value, convenience and discovery that our customers depend on Dollar Tree to provide," Creedon said. 

DG: Dollar General posted record quarterly net sales, which rose 5.3% to $10.4 billion and same-store sales were up 2.4% in the first quarter. 

CEO Todd Vasos said on the company's earnings call that the core customer remains "financially constrained," but the chain is increasingly attracting wealthier households seeking value.

FIVE: Five Below reported total revenue was up 19.5% and comparable sales increased 7.1% year-over-year.

CEO Winnie Park said, "We were pleased to see broad-based strength across the majority of our merchandising worlds, resulting in a transaction-driven 7.1% increase in comparable sales, as well as strong performance from our new stores." 

Five Below also raised its fiscal earnings and revenue outlooks, indicating it sees the positive trends continuing throughout the year. 

Why It Matters: Data from Placer.ai confirms that dollar and discount stores are outperforming other retail sectors in 2025, with foot traffic up 3% year-over-year. Loyalty is also on the rise, as more shoppers visit these stores three or more times per month. 

The trend shows inflation and economic uncertainty are pushing mainstream America to prioritize affordability and maximize their purchasing power to the benefit of dollar stores. 

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