Dollar Tree Inc. reported better-than-expected results, but warned investors that its second quarter profit could be down significantly from a year ago.

The company reported revenue of $4.6 billion, and same-store sales growth of 5.4%, both ahead of what analysts anticipated. It also said adjusted earnings per share this quarter might drop as much as 50% from a year earlier, citing the timing of costs without giving specifics.

Shares of Dollar Tree fell 2.8% in premarket trading. The stock had gained 29% this year through Tuesday’s close.

The retailer is going through a major transition. It’s selling its Family Dollar division, which had been struggling, for about $1 billion. That transaction, which is on track to close this quarter, will allow the company to focus on its stronger Dollar Tree chain.

Results are likely being aided by higher-income shoppers shifting purchases to discounters amid weakening consumer confidence. Dollar General Corp. pointed to that benefit on Tuesday when it reported better-than-expected results and raised guidance.

‘Emerge Stronger’

“History has shown that we have the resilience to emerge stronger from periods of economic uncertainty,” Chief Executive Officer Mike Creedon said in the earnings press release. And the retailer sees today’s “rapidly evolving environment” as an opportunity, he said.

Dollar Tree maintained its annual outlook for net sales, saying it reflected tariffs currently in place. It also raised its expectations for earnings per share from continuing operations.

Most of Dollar Tree’s directly imported products come from China, which has been a focus of the Trump administration’s tariffs. On Wednesday, the company said it expects to mitigate most of the “incremental margin pressure” from higher tariffs.