Current:Home > ContactCostco membership growth 'robust,' even amid fee increase: What to know about earnings release -WealthSphere Pro
Costco membership growth 'robust,' even amid fee increase: What to know about earnings release
View
Date:2025-04-19 02:58:14
Costco got off to a good start this holiday shopping season as the retailer racked up increased sales ahead of Black Friday and the official start of consumers' seasonal buying.
The members-only warehouse company also got a boost in revenue from higher membership fees, which it began charging in September – its first hike in membership fees in seven years.
Costco reported net sales of $61 billion, up 7.5% for the first quarter of the company's 2025 fiscal year, compared to $56.7 billion a year ago, the company said Thursday. The three-month period ended Nov. 24, a week before Black Friday.
"Seasonal sell-through appears to be very strong," said Gary Millerchip, Costco's chief financial officer and executive vice president, during a call with investment analysts Thursday. "People are very basic buying this year, but good trends."
Revenue from membership fees rose 7.6%, accounting for $1.17 billion, up from $1.08 billion a year ago, the company said.
Holiday deals:Shop this season’s top products and sales curated by our editors.
The price of an annual Costco membership rose from $60 to $65 for United States and Canada Gold Star memberships and executive memberships increased from $120 to $130, with the maximum annual 2% reward associated with the executive membership increasing from $1,000 to $1,250.
Costco reported revenue of $62.15 billion, up 7.5%, from a year ago. That's higher than the $61.9 billion estimated from Wall Street analysts polled by S&P Global Market Intelligence.
Membership fees brought in $4.8 billion in the previous fiscal year, which ended Sept. 1, 2024, and $1.5 billion for the previous three months, the company reported in September.
The company said it now had 77.4 million paid memberships, an increase of 7.6%. Nearly half (47%) were executive memberships.
More shoppers came to Costco
Costco, which sells products in bulk packages and has discounts on food including eggs for as low as $3, continued to see sales growth as consumers still remain concerned about prices.
With a shortened holiday shopping season, Costco joined other retailers in running pre-Black Friday sales in early November. Store traffic rose 5.1% during the period, while comparable tickets (individual customer sales totals) were up 0.1%, the company said.
"As consumers across income levels continue to prioritize value, Costco is benefiting from robust membership growth and is generating additional revenue from the recent membership fee increase," said Sky Canaves, principal analyst for retail and ecommerce at eMarketer, told USA TODAY.
"Among the major US retailers we track, Costco is one of the few that can boast of meaningful above-average ecommerce growth in 2024," Canaves said. "It's starting from a small base and still has a long runway to expand its online business with additional revenue opportunities coming from the marketplace and retail media network."
Costco exec: Sale of gold bars, precious metals drives traffic
Costco reported a 13% increase in ecommerce sales during the quarter, with top ecommerce sales categories including gift cards, hardware, home furnishing, health and beauty aids, sporting goods, and gold and jewelry. The company has had success selling gold bars, silver coins and, most recently, platinum bars.
Costco members can go to the website to purchase gold bars (currently priced at $2,749.99), platinum bars ($1,049.99), and silver coins ($649.99).
Having precious metals has driven "significant traffic" to the company's website, and "it's driving our ability to grow our digital business overall," Millerchip said.
In the previous quarter, Costco saw sales increase, but not as high as Wall Street had expected, suggesting consumers were spending with trepidation.
The company's shares, which are up 51% so far this year, rose nearly 1% in extended trading.
Contributing: Reuters
Follow Mike Snider on X and Threads: @mikesnider &mikegsnider.
What's everyone talking about?Sign up for our trending newsletter to get the latest news of the day
Disclaimer: The copyright of this article belongs to the original author. Reposting this article is solely for the purpose of information dissemination and does not constitute any investment advice. If there is any infringement, please contact us immediately. We will make corrections or deletions as necessary. Thank you.
veryGood! (93983)
Related
- Realtor group picks top 10 housing hot spots for 2025: Did your city make the list?
- North Korea says first spy satellite crashes into sea after launch, admits failure
- As China raids U.S. businesses and arrests workers, the corporate landscape is getting very risky
- Russia used starvation tactics against Ukraine civilians, investigators claim in new war crime allegation
- Trump suggestion that Egypt, Jordan absorb Palestinians from Gaza draws rejections, confusion
- What Spring 2023 Handbag Trend You Are Based On Your Zodiac Sign
- Many Afghans who fled Taliban takeover two years ago are still waiting for asylum in U.S.
- Phoebe Bridgers Calls Out Fans Who “F--king Bullied” Her at Airport After Her Dad’s Death
- A South Texas lawmaker’s 15
- See Jennifer Aniston’s Relatable Reaction to Learning Friends Co-Star Cole Sprouse Is 30 Years Old
Ranking
- 'Survivor' 47 finale, part one recap: 2 players were sent home. Who's left in the game?
- The History of Jennifer Aniston's Adorable Friendship With Adam Sandler
- Woman wins chaotic UK cheese race despite being knocked unconscious
- Jeremy Renner Shares How 10-Year-Old Daughter Ava Has Healed Him After Accident
- Juan Soto to be introduced by Mets at Citi Field after striking record $765 million, 15
- Drew Barrymore Gets Her First Hot Flash With Jennifer Aniston by Her Side
- What would a Trump or DeSantis 2024 U.S. election win mean for Ukraine as Russia's war grinds on?
- Get a Mess-Free Tan in 1 Hour and Save 63% On Tan-Luxe Self-Tanning Mousse
Recommendation
Nevada attorney general revives 2020 fake electors case
Jeremy Renner Shares How 10-Year-Old Daughter Ava Has Healed Him After Accident
Kourtney Kardashian Responds to Comments About Her “Nasty” Bathroom Dinner
RHONJ's Jennifer Aydin Reveals If She's Ever Considered Divorce Amid Marriage Problems
A South Texas lawmaker’s 15
Denmark and Netherlands to lead F-16 training for Ukrainians
Phoebe Bridgers Calls Out Fans Who “F--king Bullied” Her at Airport After Her Dad’s Death
Transcript: Ukrainian Ambassador Oksana Markarova on Face the Nation, June 4, 2023