Exterior view of a Costco store on August 18, 2020 in Teterboro, New Jersey.
Kena Betancur | Corbis News | Getty Images
Costco on Tuesday reported quarterly earnings that topped Wall Street’s expectations, as shoppers turned to the membership club for cheaper gas, discounted prices of bulk items and more.
Here’s what the membership-based warehouse club reported for the three-month period that ended Sept. 3 compared with what analyst were expecting, according to consensus estimates from LSEG, formerly known as Refinitiv:
- Earnings per share: $4.86 vs. $4.79 expected
- Revenue: $78.9 billion vs. $77.9 billion expected
Costco’s net income for the fiscal fourth-quarter rose to $2.2 billion, or $4.86 per share, compared with $1.87 billion or $4.20 per share a year earlier.
Comparable sales for the company rose 1.1% year over year, but only 0.2% in the U.S. Excluding changes in gas prices, the metric rose 3.8% overall and 3.1% in the U.S.
E-commerce sales declined 0.8% compared with the year-ago period.
Costco is expected to share more details about the quarter during a conference call at 5 p.m. ET. Investors will listen for updates about inflation, consumer spending patterns and membership signups at the club.
Costco has gained momentum in the past three years, as membership-based warehouse clubs benefitted from dynamics such as more Americans cooking from home and more millennials moving into suburban homes with bigger pantries during the pandemic. Inflation has also driven some shoppers to sign up and renew their memberships to clubs, including Walmart-owned Sam’s Club and BJ’s Wholesale Club.
Yet in recent quarters, even Costco has spoken about consumers pulling back on some big-ticket and discretionary items such as jewelry, as grocery bills and housing costs remain elevated.
In the U.S., Costco’s biggest market, sales trends have slowed. The majority of Costco’s clubs — nearly 600 of the company’s 861 warehouses — are in the U.S. and Puerto Rico.
In the year-ago fiscal fourth quarter, comparable sales rose 15.8% in the U.S. and since then have largely decelerated. In the past two quarters, comparable sales — an industry metric that takes out the effect of store openings and closures — were roughly flat in the U.S. from the prior-year periods.
Shares of Costco have climbed about 21% so far this year, outperforming the 11% gains of the S&P 500. The company’s stock closed on Tuesday at $552.96, down about 1%.
