Dollar Tree gets jolt from higher-income shoppers

Driving the news: Dollar Tree topped earnings expectations and raised its full-year outlook Wednesday, giving its stock a jolt.

• The chain reported that 3 million additional households shopped there in the third quarter, compared with the same period a year earlier.

Zoom in: Of those, about 60% had household income of more than $100,000, CEO Michael Creedon Jr. said on an earnings call.

• "Today, we serve an increasingly broad spectrum of shoppers from core value-focused households to middle- and higher-income shoppers who are making deliberate choices about how and where they spend," Creedon added.

The big picture: The trade-down trend began emerging with discount and value retailers in 2022 as inflation surged — and it's persisted over the past year, boosting rivals like Dollar General and Walmart.

Flashback: Dollar Tree had been mired in a slump tied to myriad operational and financial issues, including quality problems and a soured acquisition of Family Dollar, which the company recently sold at a big loss.

The bottom line: People are looking to save.