Costco Q1 FY2022 Earnings Report Recap

COST beat on earnings and on revenue

Key Takeaways

  • Costco's comparable sales growth decelerated slightly from the previous quarter but came in above analysts' expectations.
  • Comparable sales growth is a key metric of Costco's revenue growth from its warehouses and e-commerce sites that have been in operation for at least one year.
  • The company's e-commerce sales rose 14.3% from the year-ago quarter.
Costco Earnings Results
Metric Beat/Miss/Match Reported Value Analysts' Prediction
EPS Beat $2.98 $2.60
Revenue Beat $50.4B $49.3B
Comparable Sales Growth Beat 15.0% 12.0% 

Source: Predictions based on analysts' consensus from Visible Alpha

Costco (COST) Financial Results: Analysis

Costco Wholesale Corp. (COST) reported Q1 FY 2022 earnings that surpassed analysts' expectations. Earnings per share (EPS) beat analyst forecasts, rising 13.7% year over year (YOY). Costco's revenue came in above analyst estimates, up 16.6% compared to the year-ago quarter. Comparable sales growth also exceeded analyst expectations. The company's shares rose slightly in after-hours trading. Over the past year, Costco's shares have provided a total return of 41.1%, above the S&P 500's total return of 27.1%.

COST Comparable Sales Growth

Costco's comparable sales grew a healthy 15.0%, marking a slight deceleration from the previous quarter's pace. Costco, which operates on a membership-based model, defines comparable sales as net sales generated from its membership warehouses (including relocations, remodels, and expansions), as well as e-commerce websites that have been in operation for over one year. Growth in comparable sales is achieved through an increase in the shopping frequency from new and existing members as well as in the amount they spend per visit. When comparable sales are growing, it's a sign that existing sales channels have not yet saturated the local market, nor are those sales being cannibalized by the company's newly opened stores.

Costco's next earnings report (for Q2 FY 2022) is estimated to be released on March 3 2022.

Article Sources
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  1. Costco Wholesale Corp. "Costco Wholesale Corporation Reports First Quarter Fiscal Year 2022 Operating Results."

  2. Visible Alpha. "Financial Data."

  3. TradingView. "Price Chart: COST and S&P 500."

  4. Costco Wholesale Corp. "Form 10-K for the Fiscal Year Ended August 29, 2021," Page 22.

  5. "Costco Wholesale Corp (COST): Financials (Earnings)."

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