Costco Wholesale Corp (COST.O) exceeded Wall Street sales and profit projections on Thursday, supported by robust customer spending on fresh food, home furnishings, and fuel amid rising inflation.
In extended trading, however, shares of the warehouse club operator slid nearly 2% as the company’s gross margins declined by 99 basis points in the third quarter.
The company’s total revenue rose 16% to $52.60 billion in the third quarter ended May 8, compared with analysts’ estimates of $51.71 billion.
Costco (Kohl’s Corp (KSS.N) and Best Buy Co Inc (BBY.N)‘s revenue from memberships, which are priced between $60 and $120 per year, rose to $984 million in the quarter.
An average shopper at Costco earns more than a typical Walmart and Target customer.