On Thursday, Costco Wholesale reported solid fourth-quarter financial data yet failed to meet revenue estimates due to cautious consumer spending.
Its stock price was dragged down by -0.77% to $901.44 apiece on September 26’s Asian afternoon session. Likewise, it is expected to drop by -1.42% to $889.00 per share in after-hours trading.
The membership-only store’s earnings per share (EPS) increased to $5.29, beating the analysts’ forecast of $5.08 and the $3.78 from the past quarter.
Moreover, its revenue jumped to $79.70 billion, slightly below the anticipated $79.93 billion. Still, it surpassed the $58.52 billion from Q3. The results came amid worrisome consumer spending on pricier items in stores and lower gasoline prices.
Meanwhile, the big-box warehouse’s e-commerce sales fell short of the outlook despite climbing by 18.90% year-over-year compared to the 20.00% growth last quarter.
Same-store sales of Costco climbed by 5.30% in the US and 5.50% in Canada. However, the figures hinted at slower progress from the previous period.
Although it worked on garnering higher online sales, e-commerce sales were still down to 18.90%, down from 20.70% in Q3.
The earnings results of Costco reflected the impacts of the membership fee spike. As a result, investors may monitor how the fees could affect the company’s profits going further.
Membership Card Scanners to be Launched by Costco
To improve customer experience and operational efficiency, Costco is integrating membership card scanners at its storefronts.
The strategy is already being tried out in several locations, which require all members to scan their physical or digital cards upon entering the stores.
Moreover, streamlining the verification process aims to eliminate the friction of checking cards at the register, enabling staff to focus on customer service.
According to Costco CEO Ron Vachris, the new system would provide real-time traffic insights for the day to improve inventory management. Early feedback showed positive reviews from both members and employees, which ramped up membership sign-ups.
