Costco (COST 186.59, -0.77) has given up 0.4% in pre-market after missing earnings expectations. The modest decline leaves the stock roughly 14 points below its record high from late January.
The wholesale retailer reported below-consensus second quarter earnings of $1.42 per share on a 10.8% year-over-year increase in revenue to $32.99 billion, which was just ahead of estimates. Membership revenue grew 12.6% to $716 million.
Company-wide comparable sales grew 8.4% year-over-year with International sales jumping 15.7% while Canadian sales grew 8.7% and U.S. comparable sales increased 7.1%.
Looking to prevent Amazon (AMZN 1551.10, +6.10) from cutting into its business, Costco has put continued emphasis on the e-commerce side of its business. Like Amazon, the company offers two-day delivery and one-hour grocery delivery from nearby stores. E-commerce comparable sales grew 28.5% during the second quarter, below the 35.0% growth rate that has been observed over the last six months.
Costco also reported its February sales. Company-wide sales grew 10.5% in February, paced by a 22.2% year-over-year increase in International Sales. U.S. sales grew 9.0% while comparable sales in Canada increased 8.4%. E-commerce sales jumped 38.1% year-over-year, outpacing the growth rate observed during the first six months of the fiscal year.
The company ended the quarter with 749 locations. Costco has 519 warehouses in the U.S. and Puerto Rico, 98 locations in Canada, and 38 locations in Mexico. There are 28 stores in the U.K., 26 in Japan, 14 in South Korea, 13 in Taiwan, nine in Australia, two in Spain, one in Iceland, and one in France.