Tractor Supply Posts Weak Q2, Lowers Full-Year Outlook

Tractor Supply Co. reported second-quarter sales that rose just over 2% year-on-year to $4.5 billion, while comparable-store sales fell 1.5%. Gross profit edged up 20 basis points to 37.1%, but net income dropped more than 16% to $360.7 million. The retailer trimmed its 2024 guidance, now projecting net-sales growth of 2.5%–3.5% (down from a prior 6% target), flat-to--1% comparable-store performance, and net income of up to $990 million (versus an earlier $1.17 billion outlook.

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• Net sales: +2% YoY to $4.5 billion

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• Comparable-store sales: –1.5%

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• Gross profit margin: 37.1% (up 20 bps)

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• Net income: $360.7 million (-16% YoY)

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• Revised 2024 outlook: sales growth 2.5%–3.5%; comps flat to –1%; net income <= $990 million

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To offset the slowdown, Tractor Supply plans to close roughly 75 underperforming Petsense locations and reduce the number of new Tractor Supply stores slated for 2027 from 100 to 10–15. Capital saved will be redirected toward last-mile delivery capabilities and store remodels.

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CEO Hal Lawton attributed the quarter’s weakness largely to persistent drought conditions across key southeastern markets, which curbed seasonal lawn-care demand. He noted that customers are still spending on pets and farm essentials but are pulling back on discretionary items and consolidating trips.

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• “Admittedly, this is mostly for commodity products rather than specialist farm and ranch supplies – where Tractor Supply still has an advantage – but it is still an unhelpful trend that takes the edge off growth,” — Neil Saunders, globaldata managing director

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