Costco’s quarterly results again put
the membership club well ahead of most other retailers, with revenue rising 7.5% to $60.99 billion. And while those sales gains were a bit below expectations, net income jumped 12.5% to $1.8 billion
in the first quarter of its fiscal year, compared to $1.6 billion in the comparable period of last year, better than forecasts.
In an earnings call webcast for investors, the company also
rewarded analysts with a collection of quirky facts from the quarter, all of which underscore the giant retailer’s steadily diversifying offerings, including such new brands as Peloton,
Wrangler, Springfree Trampolines and Ruggable.
Costco made its largest travel booking ever, with a $293,000 150-day around-the-world cruise. With a booking for two in an owner’s suite
cabin, the adventure starts in Fort Lauderdale, with stops in the Galapagos and Easter Island and includes $13,000 shipboard credit and a Costco $25,000 gift card.
The bakery division sold 4.2
million pies in the three days before Thanksgiving, and food courts served 274,000 whole pizzas on Halloween, both new records.
In-store traffic rose 4.9% in the U.S. And renewal rates held
more or less steady at 92.8% in the U.S. and Canada, with membership fee revenues rising 7.8% to $1.2 billion.
Categories that made increases in the double digits include golden jewelry, gift
cards, home furnishings, sporting goods, health and beauty aids, luggage, hardware and meat.
The Issaquah, Washington-based company also announced plans for 29 new stores this year, which
includes three relocations.
“We continue to think that Costco’s attractive merchandise assortment and vast scale should drive further market share gains and a widening cost
advantage in the long run,” writes Noah Rohr, an analyst who follows Costco for Morningstar.
He notes Costco’s top-line growth is consistent with results from Sam’s Club, its
main warehouse club competitor, and that Costco continued to outpace recent comparable sales growth from Walmart’s, where domestic sales climbed 5.3% in the recent quarter; Kroger, which managed
a 2.3% sales gain in the most recent quarter; and Target, where sales squeaked out an increase of just 0.3%.
“We were pleased to see management cite high-single-digit sales growth in the
fresh foods category and a mid-single-digit gain in food and sundries,” he says, “both comfortably outpacing the 1.3% average annual growth in food-at-home inflation from September to
November 2024.”