Big box retailer Costco (COST) has reported quarterly financial results that beat Wall Street expectations on both the top and bottom lines, fueled by strong grocery sales.
The Seattle-based warehouse club said its earnings per share (EPS) came in at $4.86 U.S. versus $4.79 U.S. that was expected among analysts.
Revenue in what was the company’s fiscal fourth quarter totaled $78.9 billion U.S. compared to $77.9 billion U.S. that was expected.
The company said that the strong results were due to robust grocery sales and that its customers bought fewer big-ticket items at its outlets during the quarter.
Traffic at Costco stores worldwide rose 5.2% and gained 5% within the U.S. on a year-over-year basis. However, average transaction amounts at Costco in the quarter declined nearly 4% worldwide and 4.5% in the U.S.
Costco said it ended the quarter with 71 million paid household members, up nearly 8% from a year ago. That growth outpaced its rate of new store openings, which grew by 3%.
Most of Costco’s outlets, nearly 600 of the company’s 861 warehouses, are in the U.S.
The company’s e-commerce sales dipped 0.8% compared with a year ago as consumers spend mainly on food items and less on discretionary products such as furniture and electronics.
Investors and analysts had been anticipating a membership fee hike for Costco. However, the company continues to hold off on any increases to its membership tiers. The last time Costco raised its membership fees was in 2017.
Executives at Costco said on an earnings call with media and analysts that they plan to open 10 new stores in the next three months, including nine in the U.S. and one in Canada.
Costco’s stock has gained 16% over the last 12 months and currently trades at $552.96 U.S. per share.