Costco Q2 Revenue Slips Slightly

Here's what Costco reported, compared to Wall Street estimates:

Revenue: $55.27 billion versus $55.58 billion expected

Adjusted earnings per share: $3.30 versus $3.21 expected

Same-store sales: up 6.8% versus up 6.16% expected

United States: up 5.8% versus up 5.56% expected

There is a clear shift in consumer demand away from discretionary spending.

Evidently, the company saw an increase in sales of fresh food, food and sundry categories, but a drop in non-food items such as apparel, jewelry, and electronics.

This change in demand is similar to results from Target and Walmart’s latest earnings.

On another note, there could be a potential hike to its membership fees.

With their membership-fee being virtually 100% margin, this translated directly to earnings growth. This quarter, membership fees brought in $1.03 billion, up 6.2% from a year ago and a tick higher than Wall Street estimates of $1.04 billion.

So, with the hike coming in, this can be great news for Costco’s shareholders!

Let me know what you think about the potential hike of membership fees.

Source: Yahoo Finance