News Summary
Costco’s shares soared to record highs following the announcement of better-than-expected earnings and revenues. Sales of food items and other goods, including gold bars, contributed to its results. Costco announced a special cash distribution of $15 per share, which will be paid on January 12.
News Details
Costco’s shares (COST) rose more than 4% to a record high in Friday’s trading after the announcement of first-quarter financial results that surpassed analysts’ expectations, as consumers flocked to Costco stores to buy groceries and other products in search of lower prices.
The membership-based company reported net sales of $56.72 billion, a 6.1% increase from the same period last year and above analysts’ expectations. Net earnings reached $2.2 billion or $4.86 per share, compared to $1.87 billion or $4.20 per share the previous year, also exceeding expectations.
This increase came with a rise in membership numbers and increased food sales, with Costco announcing that it sold over 4 million pies during the Thanksgiving holiday alone. The number of paid household members rose by 7.6% from last year, while membership fee revenues increased by 8.2% to $1.08 billion.
Costco’s Chief Financial Officer, Richard Galanti, stated that the company performed better than expected during Black Friday and Cyber Monday. He also commented on the popularity of the company’s gold bars, as $100 million worth of gold was shipped in the last quarter.
Galanti noted that Costco’s CEO, Craig Jelinek, will step down at the end of the year after a decade in leadership. He will be succeeded by Ron Vachris, who started as a forklift operator at the company 40 years ago and is currently the Chief Operating Officer.
Costco also announced a special cash distribution of $15 per share, which will be paid on January 12.
Costco’s shares rose 4.8% on Friday around 12:20 PM EST and have increased over 45% since the beginning of the year.
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Costco. “Costco Wholesale Company’s First Quarter FY 2024 Earnings Report and Announcement of a $15 Per Share Special Cash Distribution.”
Costco. “Q1 2024 Earnings Call.”
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