Shares of Dollar Tree fell more than 22% on Wednesday after the discounter cut its full-year outlook, citing increasing pressures on middle-income and higher-income customers.

The retailer said it now expects its full-year consolidated net sales outlook to range between $30.6 billion and $30.9 billion. It expects adjusted earnings per share to range from $5.20 to $5.60. That compares with previous guidance of $31 billion to $32 billion in net sales and $6.50 to $7 for adjusted earnings per share.

In a news release, Chief Financial Officer Jeff Davis said the company cut the forecast to reflect softer sales and costs associated with converting 99 Cents Only stores. The company also said it has had higher expenses to reimburse, settle and litigate claims related to customer accidents and other incidents at stores.

Here’s how Dollar Tree did in its fiscal second quarter ended Aug. 3 compared with Wall Street expectations, according to analysts surveyed by LSEG:

• Earnings per share: 97 cents adjusted vs. $1.04 expected
• Revenue: $7.38 billion vs. $7.49 billion expected

The 97 cents per share earnings figure excludes a 30 cents per share charge for general liability claims.

Dollar Tree’s report comes about a week after major rival Dollar General slashed its full-year sales and profit outlook, sending its shares tumbling. Dollar General CEO Todd Vasos chalked up weak sales to “a core customer who feels financially constrained.”

Dollar stores, in particular, have felt pinched as their core customer — shoppers with lower incomes and little leftover money to spend on discretionary items — makes trade-offs after a prolonged period of pricier food and everyday costs. Walmart has won more business from value-conscious shoppers across incomes and newer online players, such as Temu, have also attracted customers with cheap merchandise.

Dollar Tree includes two store chains, its namesake, which sells a wide variety of lower-priced items like party supplies, and Family Dollar, which carries more food.

Same-store sales for the company rose by 0.7% in the quarter. At Dollar Tree, same-store sales increased by 1.3% and at Family Dollar, same-store sales fell by 0.1%. The industry metric takes out the impact of store openings and closures.

On an earnings call, Davis said the company saw weaker sales, particularly on the discretionary side of the business. He said it “reflected the increasing effect of macro pressures on the purchasing behavior of the Dollar Tree’s middle- and higher-income customers.”

“Our original second-quarter outlook did not anticipate those pressures migrating to Dollar Tree’s customer base to the degree that they did,” he said.

Along with contending with inflation-stretched shoppers, Dollar Tree has faced company-specific challenges. The retailer announced in March that it would close about 1,000 Family Dollar stores, citing market conditions and store performance. Then, in June, the company said it is considering selling the Family Dollar brand.

Dollar Tree bought Family Dollar for nearly $9 billion in 2015 and since then, it’s struggled to strengthen the grocery-focused chain and better compete with Dollar General.

The liability claims also added to the company’s challenges. On the company’s earnings call, Davis said the outcome of claims, particularly older ones, “has become increasingly challenging to predict given the higher settlement and litigation costs that have resulted from a more volatile insurance environment.” 

“The claims have continued to develop unfavorably due to the rising cost to reimburse, settle, and litigate these claims, which impacted our actuarially determined liabilities,” he said.

As of Tuesday’s close, Dollar Tree’s shares are down nearly 43% so far this year. The company’s stock hit a 52-week low on Tuesday and closed the day at $81.65.

— CNBC’s Robert Hum contributed to this report