Wholesale Corp. posted higher sales in the most recent quarter, the latest indication that the warehouse seller remains a haven for consumers facing persistent inflation.
Sales of the Issaquah, Wash. incumbent company rose 15% to $72.09 billion in the fourth quarter. The average analyst estimate polled by FactSet was $72.04 billion.
Comparable store sales, which match that of stores and digital channels that have been in business for at least 12 months, increased by almost 14% in the quarter compared to the same period last year. E-commerce sales increased by 7.1% in the same period.
Costco, specialized in sell bulk goods at a discount to paying memberslargely benefited during the Covid-19 pandemic as consumers bought in bulk to limit their outdoor travel, and demand was boosted by government incentives.
The company has remained a popular destination as inflation has depressed consumers’ purchasing power. The consumer price index, which measures what consumers pay for goods and services, rose 8.3% in August from the same period a year ago. The food index rose 11.4% in the past year, the largest increase in 12 months since May 1979, according to the U.S. Bureau of Labor Statistics said earlier this month.
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Costco posted net income of $1.87 billion, or $4.20 per share, for the quarter ended Aug. 28, up from net income of $1.67 billion, or $3.76 per share, a years earlier. Analysts polled by FactSet were expecting $4.19 per share.
Chief Financial Officer Richard Galanti said the company has no specific plans for an increase in membership fees at this time, but noted that one will take place at some point. “We’ll still have that arrow in our quiver as we go,” Mr. Galanti said.
The decision contrasts with:
moving in August to increase membership prices at the Sam’s Club chain from $50 from $45 for the basic offering and to $110 from $100 for the premium offering. The price increase is the chain’s first in nine years for its basic membership and the first for its premium offering since it debuted in 1999.
“We are aware of the financial strain on wallets right now,” said Sam’s Club Chief Executive Kathryn McLay at the time.
Costco shares fell 2.6% in after-hours trading. The stock closed at $487.17 on Thursday, down 1.2%.
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