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A Dollar Tree store in California. Photo: Frederic J. Brown/AFP via Getty Images

Dollar Tree said acceleration of the trade war with China would up its costs by $19 million in Q4.

Why it matters: Even as the Trump administration says it’s close to a "phase one" trade deal with China, corporations are bearing down and preparing Wall Street for the worst-case scenario.

  • The administration has been mum on whether or not new tariffs on about $300 billion worth of Chinese imports will take effect on Dec. 15.

What they’re saying: “Obviously, the biggest unknown as we sit here today for us and many other retailers is tariffs and where [that lands] at the end of the day,” Dollar Tree CEO Gary Philbin told analysts after the company, which also owns Family Dollar, reported earnings on Tuesday.

  • Shares dropped by as much as 15% after the company reported earnings that fell short of estimates and it pared back Wall Street’s profit expectations for the following quarter.
  • The company blamed “continued uncertainty regarding trade and the related tariffs,” per a release.
  • The company’s cost of goods sold jumped 4.5% year-over-year.

The bottom line: Dollar Tree, which makes its name on inexpensive products, is taking action to hold the line on prices.

  • “We are moving some product out of China, we’re sourcing to elsewhere, we are redesigning product,” Philbin told CNBC.

Go deeper:

Go deeper

Updated 2 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Annelise Capossela/Axios

  1. Health: CDC director defends agency's response to pandemic — CDC warns highly transmissible coronavirus variant could become dominant in U.S. in March.
  2. Politics: Biden readies massive shifts in policy for his first days in office.
  3. Vaccine: Fauci: 100 million doses in 100 days is "absolutely" doable.
  4. Economy: Unemployment filings explode again.
  5. Tech: Kids' screen time sees a big increase.
  6. World: WHO team arrives in China to investigate pandemic origins.
Dave Lawler, author of World
3 hours ago - World

Alexey Navalny detained after landing back in Moscow

Navalny and his wife shortly before he was detained. Photo: Kirill Kudryavtsev/AFP via Getty

Russian opposition leader Alexey Navalny was detained upon his return to Moscow on Sunday, which came five months after he was poisoned with the nerve agent Novichok. He returned despite being warned that he would be arrested.

The latest: Navalny was stopped at a customs checkpoint and led away alone by officers. He appeared to hug his wife goodbye, and his spokesman reports that his lawyer was not allowed to accompany him.

Mike Allen, author of AM
5 hours ago - Politics & Policy

Biden's "overwhelming force" doctrine

President-elect Biden arrives to introduce his science team in Wilmington yesterday. Photo: Kevin Lamarque/Reuters

President-elect Biden has ordered up a shock-and-awe campaign for his first days in office to signal, as dramatically as possible, the radical shift coming to America and global affairs, his advisers tell us. 

The plan, Part 1 ... Biden, as detailed in a "First Ten Days" memo from incoming chief of staff Ron Klain, plans to unleash executive orders, federal powers and speeches to shift to a stark, national plan for "100 million shots" in three months.

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