Retailer delivers fourth-quarter profit beat as investors pay close attention to pressures on U.S. consumers
Costco reported quarterly results on Thursday.
Costco Wholesale on Thursday reported quarterly results that beat expectations, helped in part by tariff refunds.
The retail giant reported fourth-quarter revenue of $95.72 billion, an 11% year-over year gain and above FactSet forecasts for $94.97 billion. Same-store sales, or those made at established stores, rose 9.4% during the period, topping estimates for a 9% increase.
Costco (COST) earned $6.75 a share, beating expectations for $6.54. Tariff refunds helped, contributing 15 cents a share to the bottom line. The company noted "partial reinvestment of those refunds in increased member values." Costco's fourth quarter ended on Aug. 30.
The retailer reported the results at a time when investors are paying close attention to the pressure on U.S. consumers. Rival Walmart (WMT) last month sparked concerns about deeper consumer stresses, as higher gas prices and other costs constrained spending. Costco in May said demand at its gas stations had reached record levels.
Meanwhile, those two retail powerhouses are competing in other ways. Both are offering Medicare Advantage plans, and both are trying to expand their delivery networks. Costco and Uber Technologies (UBER) this month said they would expand delivery service via Uber Eats to 47 states.
Ahead of the results, RBC analysts also had their eyes on the tariff refunds, which were seen as a way to boost profitability to facilitate reinvestments in the consumer experience.
They were also focused on membership renewal rates. Costco has said that members who sign up online - a growing portion of its members overall - renew at a slightly lower rate than people who sign up in its warehouses.
Oppenheimer analysts last week noted that shares of Costco have fallen after seven out of the past 10 earnings reports. Shares were largely flat in the extended session on Thursday.
-Bill Peters