Costco Wholesale Corporation continues to face challenges related to higher commodity prices, wages, transportation costs and supply chain disruptions. But there’s a “little light at the end of the tunnel,” according to executive vice president/CFO Richard A. Galanti.
Galanti made the comments on a conference call Thursday afternoon following the release of the company’s fourth-quarter financial results, confirming that enthusiasm for the brand is still strong.
The member stock trader reported Q4 EPS of $4.20, beating analyst estimates of $4.17. Net sales for the quarter increased at a 15% annual rate to reach $222.73 billion. Additionally, comparable sales for the quarter were strong across all regions, led by the US, which rose 15.6%. Meanwhile, e-commerce sales, an area dominated by Amazon, rose 7%.
Still, Wall Street was unimpressed by the company’s performance, sending its shares lower in Thursday trading.
Still, Anthony Denier, CEO of Webull, a trading platform, was pleased with the company’s performance.
“Despite rising inflation pushing up prices, higher-income consumers have shown strong demand for fresh food and fuel deals,” he told International Business Time in an email.
Gregory Ng, CEO of consumer advisory firm Brooks Bell, was also impressed by Costco’s continued strong performance and its ability to meet the challenges of the economy by delivering value and “personal” experiences – like showrooms with large items like electronics and tires and Taste testing new food products – to its customer base.
“It’s clear that Costco knows its customers and has benefited from retail engagement and retail experience patterns,” Ng told IBT.
Meanwhile, Costco has capitalized on emerging retail trends like the convergence of online and offline shopping with the launch of Costco Next (CN). It’s a special category that includes a wide range of curated products from some of the company’s most trusted suppliers, allowing it to compete effectively with Amazon.
Ethan Chernofsky, VP of Marketing at Placer.ai, is impressed with the company’s ability to adapt to these critical retail trends and keep enthusiasm for the brand alive, with visits steadily increasing above pre-pandemic levels. That makes him optimistic about the company’s prospects.
“As we look further ahead, the move to the suburbs will continue to add value as new audiences are introduced to the retailer,” he said. “The combination of this trend alignment, the retailer’s strength and the unique ‘stickiness’ of its model should position Costco for even greater success in the future.”
Editor’s note: The author owns shares of Costco
https://www.ibtimes.com.au/costco-keeps-buzz-alive-beats-inflation-1838705?utm_source=Public&utm_medium=Feed&utm_campaign=Distribution Costco keeps the buzz alive and beats inflation