Here's What Costco Just Said About Membership Fee Increases
Shoppers were worried that Costco will hike membership costs after Sam's Club did. Finally, the top warehouse club's earnings call yesterday answered the question.
Most shops are struggling with inflation this year, but wholesale warehouse clubs have profited from buyers fleeing higher prices.
A good deal? Only if membership costs are affordable. Thank goodness Costco's CFO Richard Galanti told shoppers and shareholders that the company has no intentions
However, Galanti warned that prices will inevitably rise. "We still have that arrow in our quiver as we go forth," he told.
Costco "Gold-Tier" memberships cost $120, while ordinary memberships cost $60. Walmart-owned Sam's Club
announced last month that entry-level memberships would cost $50 and "Plus-Level" membershipswould cost $110, up from $100.
Costco's pricing appears to be stable. Most analysts were surprised when the retailer's fourth-quarter revenue rose 15% to $72.10 billion.
These results contrast with Target Corporation's previous report, which showed a drop in quarterly profits due to inflation-conscious shoppers saving more and spending less.
There was bad news for Costco. Company inventories rose 26% year over year in the fourth quarter. Galanti said, "Initial seasonal sales seem
to be going well," on the call. "[I] would expect the 26% year-over-year increase to start to head down as it has in just the past few weeks a little bit."
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