Costco quarterly results miss as demand weakens, costs jump


(Reuters) -Costco Wholesale Corp reported first-quarter results on Thursday that missed analysts' estimates, with surging inflation pushing consumers to cut back spending and as operating expenses increased for the company.

Retailers Target Corp and Dollar Tree Inc also said in November that stubbornly high inflation and changes in consumer spending were driving down demand for discretionary goods such as toys and electronics.

Costco's total revenue for the first quarter was $54.44 billion, compared with estimates of $54.64 billion, according to Refinitiv IBES data.

The warehouse club operator's merchandise costs rose about 9% to $47.77 billion as it grapples with higher freight and labor costs.

On an adjusted basis, the company earned $3.10 per share, missing estimates of $3.11.

The company's quarterly revenue from memberships, priced between $60 and $120 per year and which accounts for most of Costco's gross margin, rose to $1 billion from $946 million.

The big-box retailer's shares fell marginally to $480.35 in extended trading.

(Reporting by Granth Vanaik in Bengaluru; Editing by Shounak Dasgupta)


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