March 5 (Reuters) - Costco Wholesale beat Wall Street estimates for second-quarter comparable sales on Thursday, helped by resilient holiday-season demand for affordable essentials as well as "nice-to-have" items at its membership-only stores.
With Americans increasingly focusing on value to stretch their budgets stressed by high costs of rent and gas, big box stores such as Walmart and Costco are attracting consumers across income categories.
Costco CEO Ron Vachris said on a post-earnings call it was not yet clear if or when companies would receive refunds from the IEEPA tariffs they paid last year, but added that Costco would look to lower prices and provide better value to customers if it receives any refunds.
The company had lowered prices on items such as textiles, bedding and cookware after tariffs were reduced on countries such as China following the Supreme Court decision.
Costco was among over 1,000 businesses that sued the government saying U.S. President Donald Trump lacked legal authority to impose tariffs under the 1977 International Emergency Economic Powers Act.
While the Supreme Court struck down the emergency duties, Trump's move to enforce temporary levies on imports is adding to macroeconomic strain for consumer companies already grappling with a volatile trade backdrop and higher cost pressures.
Costco, which raised its membership fee in 2024, has also been investing in its in-house brand Kirkland Signature.
"The stock had high expectations heading into the print given it's above-average valuation, but the market will likely continue to view the stock as a safe haven due to geopolitical volatility," said David Wagner, head of equity and portfolio manager at Aptus Capital Advisors.
The company's quarterly same-store sales, excluding gas, rose 6.7%, compared with analysts' estimates of a 5.88% rise, according to data compiled by LSEG.
Net income for the second-quarter rose nearly 14% to $2.04 billion.
The company's shares were largely unchanged in extended trading on Thursday.