On Thursday, Coscto Wholesale Corp (NASDAQ:$COST) released their earnings. Notable in the report was the much higher-than-expected revenue. Despite an increase in membership fees across the United States, the wholesale giant reported that sales have actually risen.
Many brick-and-mortar stores have recently been threatened in what some are calling the ‘Amazon Apocalypse’. Amazon Inc’s (NASDAQ:$AMZN) disruptive power continues to affect big box stores across North America. Even a simple announcement can wipe away millions in market value, such as when Amazon announced its acquisition of Whole Foods Markets Inc. (NASDAQ:$WFM), causing stocks across the grocery industry to collectively drop.
However, Costco reported that its U.S. comp sales have actually risen 5.8 in the 4th quarter.
The increased membership fees are largely to thank for the rising profits. The fees accounted for 72% of Costco’s operating in 2016. In 2017, this increase a further 13%, resulting in $943 million in the 17 week span quarter.
Analysts at Consensus Metrix had forecast an increase in total comp sales of 5.1%. Costco exceeded that with a reported 5.7% increase, before calculating the impact of currency fluctuations and fuel cost.
Net income rose from $779 million to $919 million or from $1.77 per share to $2.08 per share. Total revenue rose to $42.30 billion, or an increase of 15.7%. This considerably beat analyst’s estimates of $2.02 per share and total revenue of $41.55 billion.
Featured Image: depositphotos/wolterke
