Costco Beats Expectations, Momentum Slows in the Face of Stiff Competition
ISSAQUAH, WA - Costco Wholesale Corporation has announced the results of its fourth quarter fiscal 2018. The retailer beat estimates for the 16-week period ending September 2, 2018, but despite solid increases in sales and revenue, stocks slumped as investors reportedly eyed surging competition from Amazon and Walmart.
Highlights from Costco’s Q4 financial report included the following:
- Net sales totaled $43.4 billion, an increase of 5.0 percent from $41.4 billion ;in the 17-week fourth quarter last year
- Net income of $1,043 million, or $2.36 per diluted share, compared to $919 million, or $2.08 per diluted share during fourth quarter last year
- Comparable sales for the 16-week fourth quarter were up 9.5% worldwide—and 10.8% in the U.S., with e-commerce sales up nearly 26.3%
Despite those positive numbers, though, Reuters reported that shares of Costco stock dropped roughly 3% in extended trading by 1:31 pm PST, October 4, 2018. The news source reported that, even though big investments were made in online and delivery operations, the 26.3% rise in online sales was the company’s slowest growth in that space in the year.
Despite the day’s setback, Reuters noted, Costco is experiencing a boom year—with shares of the company’s stock having risen 25% throughout 2018.
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