economy
Costco issues a lukewarm quarter, but delivers on the metric that matters most
It was not the best quarter, but far from bad.
TL;DR
- Total revenue increased 11.6% year over year to $70.53 billion, exceeding expectations.
- Adjusted EPS rose 15.2% to $4.93, meeting expectations.
- Membership fee income grew 10.7% to $1.37 billion, slightly exceeding estimates.
- U.S./Canada membership renewal rate ticked higher, holding steady globally at 89.7%.
- Executive tier memberships increased to 41.2 million, with strong adoption in China.
- Record gas sales were driven by high prices and consumer demand for discounts.
- Total comparable sales rose 9.8%, with traffic up 2.4% and ticket size up 7.3%.
- Digitally-enabled comparable sales increased 21.5% on an adjusted basis.
- Gross margin contracted 17 basis points year over year but was flat excluding gas prices.
- Costco opened four new warehouses in the quarter and plans for 12 more in the current fiscal quarter, with global openings to exceed 30 per year in the coming years.
- The company has 928 locations worldwide.