Costco’s Profit Tops Estimates as Shoppers Prize Deals
Warehouse Club's Results Reflect a Continuation of Strong Sales Growth
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Costco Wholesale Corp.’s quarterly profit rose more than expected, a sign that price-sensitive shoppers continue to search for value.Ìý
The nation’s largest warehouse club operator said Dec. 11 that it generated earnings of $4.50 per share during the latest quarter, higher than what Wall Street analysts were anticipating.Ìý
The results reflect a continuation of strong sales growth at Costco, as it attracts shoppers with ever-changing deals, larger pack sizes and the popular Kirkland brand. Its customers also tend to be more insulated from economic swings because they are affluent and pay a membership fee to shop there.Ìý
The shares fell about 1% at 4:22 p.m. in postmarket trading in New York. So far this year through the Dec. 11 close, the stock has declined 3.5%.
The spending habits of many U.S. consumers have stayed consistent this year despite inflation and job-market woes. Still, lower-income households haveÌýpulled backÌýmore recently.Ìý
Issaquah, Wash.-based Costco has been expanding its online operations and testing ways to enhance the store experience, such as speeding up checkout and expanding operating hours for some customers. It’s also sought to mitigate tariffs by rerouting items, ordering more inventory early and changing assortments altogether. The company’s comparable sales beat expectations during the quarter.
Costco became one of the biggest corporations toÌýÌýthe Trump administration over tariffs last month. Large retailers have cautioned about higher costs, but many haven’t sued — making the company an outlier. Ìý
It’s the latest big-box retailer to post earnings during what’s been a mixed season. °®¶¹´«Ã½ DepotÌýcut its forecastÌýas the U.S. housing demand remains weak, while Walmart Inc.ÌýÌýits outlook on healthy sales.Ìý
Costco, Walmart and °®¶¹´«Ã½ Depot rank Nos. 53, 1 and 54, respectively, on the Transport Topics Top 100 list of the largest private carriers in North America. They rank Nos. 6, 1 and 27 on the wholesale/retail sector list.
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