Costco Wholesale Corp announced that its profit for the fiscal third quarter had increased as revenue and sales from fees for membership were up.
The bottom line for the company missed expectations on Wall Street, while revenue topped those same estimates.
Costco, which offers consumers savings by selling its groceries and other product in bulk, said sales growth slowed recently, even as shoppers in the U.S. looked for more deals during a sluggish economic recovery.
Same store sales over the just ended quarter were up by 6%, excluding the negative impacts due to deflation in gasoline prices and foreign exchange.
U.S. stores for Costco, which represent the majority of its locations, saw 6%, while international stores posted sale growth of 8%.
Including those particular impacts, overall sales in same stores were up by 4%, with the stores in the U.S. outperforming those locations outside the U.S. with a 5% increase compared with a 3% increase.
Outside the U.S., the company has stores located in Mexico, Canada, Spain, the UK, Australia, South Korea, Taiwan and Japan.
Costco said it was planning to open eight additional warehouse stores before the end of the current fiscal year.
For the three-month period that ended on May 11, earnings at Costco finished at $473 million equal to $1.07 per share compared to $459 equal to $1.04 per share for the same period one year ago.
Total revenue increased to $25.78 billion, which represented an increase of 7%.
Analysts who were surveyed had estimated that Costco’s earnings would be 2 cents per share higher at $1.09 with revenue coming in at $25.75 billion.
Revenue from membership fees was up 5.6% to reach $560 million. At the same time, costs for merchandise were up by 7.2% to reach $22.55 billion.
The operating margin for Costco narrowed from 3% last year during the same reporting period to 2.9% for this most recent quarter.
