Costco Sales Continue to Rise -- Update
December 12 2019 - 7:04PM
Dow Jones News
By Sarah Nassauer
Costco Wholesale Corp. said Thursday sales rose leading into the
holiday shopping season, a sign that the warehouse retail chain
continues to grab market share and benefit from a strong
economy.
Comparable sales, those from stores or digital operations open
for at least 12 months, rose 5% during the quarter ended Nov. 24
excluding the impact of gasoline prices and currency fluctuations.
Thanksgiving and Black Friday, the busiest shopping period of the
year, fell a week later this year, outside of the quarter. The
shift reduced sales by about half a percentage point, the company
said.
Profit rose, with net income of $844 million during the quarter,
up from $767 million during the same period last year. Costco
earned $1.90 a share, compared with $1.73 a share during the like
quarter last year.
The retailer's e-commerce growth slowed considerably due to the
later Thanksgiving, rising 5.7%. Without the holiday shift,
e-commerce sales would have grown around 18% during the quarter,
Chief Financial Officer Richard Galanti said on a conference call
Thursday. In the previous quarter, Costco's e-commerce sales rose
21.9%.
On Thanksgiving, Costco's website slowed as shoppers rushed to
grab deals and some customers couldn't check out. "It was
unfortunate. Despite all the efforts to have plenty of capacity,"
said Mr. Galanti. Online sales from Thanksgiving through the
following Monday rose "in the very high teens," he said, but "we
did leave something on the table."
The company has long resisted encouraging shoppers to buy online
for in-store pickup, saying stores' sales growth is healthy without
offering the service and Costco would rather have shoppers come to
stores to buy. On Thursday, executives said they remain skeptical
of the service embraced by other retailers including Walmart Inc.
and Target Corp.
"As it relates to buy online and pickup in-store, we continue to
look at what others do and continue to scratch our head," said Mr.
Galanti. "We're not at a point that we're planning to do anything
with that."
Costco reported total revenue of $37.04 billion during the
quarter, up from $35.07 during the same period last year.
The company's shares fell nearly 1% to $294.63 in after-hours
trading. The stock is up 46% so far this year.
Write to Sarah Nassauer at sarah.nassauer@wsj.com
(END) Dow Jones Newswires
December 12, 2019 18:49 ET (23:49 GMT)
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