Costco’s quarterly earnings and revenue surpassed expectations, with sales climbing 8% year-over-year. The warehouse club retailer attributed its strong performance to tariff volatility, which benefits its bulk discounts and competitive prices.
CEO Ron Vachris said Costco rushed shipments ahead of tariffs and rerouted goods from countries with higher tariffs to non-US markets. This strategy has helped the company keep prices low while reducing costs associated with imported goods.
While some retailers have warned that higher tariffs will lead to price increases, Costco’s approach appears to be working. The company has lowered prices on items like eggs, butter, and olive oil, and is trying to attract customers by extending its gas station hours.
Costco’s CEO also highlighted the benefits of having a limited product range, which allows for closer relationships with suppliers and more efficient pricing negotiations. This approach has enabled the retailer to absorb some tariff-related cost differences and maintain competitive prices on staple items like pineapples and bananas.
As tariffs continue to impact the economy, Costco is well-positioned to benefit from its bulk discounts and competitive prices. The company’s shares have risen about 10% so far this year, outpacing the S&P 500’s less than 1% gains during the same period.
Source: https://www.cnbc.com/2025/05/29/costco-cost-q3-2025-earnings.html