Costco took in $984 million in new membership fee in its fiscal third quarter, helping the bulk retailer top Street forecasts for topline revenues.
Costco Wholesale Corp. (COST) – Get Costco Wholesale Corporation Report posted third quarter earnings that were largely in-line with Wall Street forecasts, with modestly higher sales, as the bulk retailer used its cheaper members-only gasoline sales to bring in customers in a challenging retail environment.
Costco said diluted earnings for the three months ending on May 8, the company’s fiscal third quarter, came in a $3.04 per share, up 10.5% from the same period last year and bang in-line with the Street consensus forecast.
Group revenues, Costco said, rose 16.3% to $51.61 billion, just ahead of analysts’ forecasts of a $51.52 billion tally. Membership revenues rose 9.2% to $984 million.
Adjusted same-store sales were up 10.8% from last year, Costco said, around 200 basis points south of the Street forecast, while e-commerce sales were up 7.9%
Costco shares, which rose 5.65% during the Thursday session, were marked 1.8% lower in after-hours trading following the earnings release to indicate a Friday opening bell price o $456.33 each.
Inflation, input cost pressures and supply chain snarls have taken their toll on the U.S. retail sector this quarter, culminating in disappointing first quarter earnings and outlooks from giants Walmart WMT, Target TGT and Amazon AMZN this month.
The S&P 500 Retailing Group is down around 23.67% so far this quarter, its worst performance since 1990, as investors expect more pain to come from both the Fed’s rate-based inflation fight and the highest nominal domestic gas prices on record, which continue to pinch household budgets and discretionary spending.
U.S. retail sales growth steadied in April, data from the Commerce Department indicated earlier this week, as record high gas prices and surging inflation failed to deter spending in the world’s biggest economy.
