Costco Wholesale said that same-store sales rose 1 percent in the latest quarter, bucking the impact of deflation and the considerable competition that exists for consumer dollars among retail giants and big-box chains.
Stripping out the impact of the dollar and also lower gas prices, the company, the second largest retailer in the United States, saw same-store sales up 2 percent in the quarter, with online sales up 8 percent in the same period, measured year over year. The same-store sales gain was the first seen in three quarters. Total companywide sales were up 3.2 percent for the quarter, with membership fees up 6.2 percent. Excluding items, earnings were $1.17, outpacing the $1.09 last year.
Drilling down into certain sales categories, as the Wall Street Journal noted, sales of TVs were up 17 percent in units but only up 2 percent in dollar terms through the November shopping period, and CEO Richard Galanti said of the earnings period, “we are going to invest in loyalty and growth while it is raining on everybody as it relates to higher levels of deflation.”
Foot traffic was up a bit more than 2 percent in the period. As for eCommerce, Galanti noted that “we think we could and should do a lot more online.”
The WSJ said that the latest Costco results debuted amid a holiday season that has sported a “relatively upbeat outlook” for the holidays, as noted in commentary from firms such as Kohl’s and Walmart.