Despite the softer quarter, Costco continues to be a best in class name and we would buy on any further weakness

Costco $Costco(COST.US)$ faced a challenging third quarter as consumers shifted their spending priorities. Amidst persistent inflation and economic instability, customers slowed down on non-essential purchases, adversely affecting Costco's earnings. While sales of essentials remained strong, demand for higher-margin items like home decor, electronics, and jewelry decreased. Despite its robust value proposition and loyal customer base, Costco's revenues failed to meet analysts' expectations, reporting $53.65 billion against the projected $54.57 billion. However, a silver lining emerged in the form of membership revenue, a critical contributor to the company's gross margin. Annual membership dues, ranging from $60 to $120, increased to $1.04 billion, up from $984 million the previous year.