Costco Wholesale Corp, a warehouse club operator, posted its quarterly profit that is higher than expected as increased promotions helped the company in dealing with increasingly fierce competition in the market.
The company caters to higher-income customers compared to Wal-Mart Stores Inc and Target Corp. It has reported a 7% increase in its same-store sales, however, the figures are excluding fuel.
Analysts from Consensus Metrix had expected the same-store sales on average to rise 5.8%. Net income, on the other hand, jumped to 496 million Us dollars or 1.12 dollars per share during the first quarter that ended November 23. This is compared to the 425 million US dollars or 96 cents a share during the previous year.
The company net sales increased 7% to 26.28 billion US dollars, while the overall revenue, including membership fees rose 7% to 26.87 billion dollars.
The average profit estimate of analysts was at 1.09 dollars per share, with 26.92 billion dollars in revenue, based on Thomson Reuters.
Shares of Costco jumped by one dollar at 144.04 dollars during the early market trading, and up until Tuesday’s close, shares of the Washington-based Issaquah rose 20% this year. Overall, the NASDAQ Composite Index jumped 12.6%.