Rick Bowmer/APBy Renee Dudley
Costco Wholesale (COST), the largest U.S. warehouse-club chain, posted fiscal second-quarter profit that trailed analyst estimates as discounts meant to attract holiday shoppers cut into sales.
Net income in the quarter ended Feb. 16 fell 15 percent to $463 million, or $1.05 a share, from $547 million, or $1.24, a year earlier, the Issaquah, Wash.-based company said Thursday in a statement. Analysts projected profit of $1.17, the average of estimates compiled by Bloomberg.
Costco has worked to lower its already discounted prices in the past year to attract more shoppers to its annual memberships. Second-quarter sales at stores open more than a year increased 5 percent, excluding changes in gasoline prices and foreign-currency exchange rates.
Revenue by similar measures fell 0.4 percent at Walmart Stores (WMT) in the U.S. and dropped 2.5 percent at Target (TGT) in their most recent quarters.
Costco’s total second-quarter sales rose about 5.8 percent to $26.3 billion. Analysts estimated $26.7 billion, on average. Revenue from membership fees advanced 4.2 percent to $550 million.
Costco fell 0.2 percent to $116.47 at the close Wednesday in New York. The shares have declined 2.1 percent this year, compared with a advance of 1.4 percent for the Standard & Poor’s 500 index (^GPSC).