Costco Powers Past Wall Street Expectations, Boasts Double-Digit E-Commerce Gains

Costco Wholesale Corp COST reaffirmed its retail dominance, reporting an impressive 9.8% growth in December U.S. core sales.

This result exceeded Wall Street’s 5.2% estimate and topped JPMorgan’s optimistic 6.7% forecast.

JPMorgan analyst Christopher Horvers credited Costco's results to "market share gains, a shorter season, and a bit better consumer" working in tandem.

E-commerce surged 35.7% year-over-year, partly thanks to Black Friday sales booked in December due to a holiday calendar shift.

Meanwhile, international operations weren't far behind, with core comps climbing 10.3% in Canada and 9.8% across other regions. "No other major retailer has succeeded in every country it entered," Horvers noted, underscoring Costco's unmatched global consistency.

Read Also: Here’s How Much $1000 Invested In Costco Wholesale 10 Years Ago Would Be Worth Today

High-Income Costco Customers

While the shorter holiday season helped December's numbers, JPMorgan's Horvers pointed to a broader trend: improving consumer spending among higher-income shoppers.

"We believe this indicates improvement in the consumer spending backdrop, particularly the upper-middle class and higher-income consumer," he said, highlighting Costco's ability to attract these coveted segments.

Costco's diverse product offerings also played a major role. Fresh foods like meat and produce were up high single digits, while non-food categories—led by jewelry, toys, and gift cards—jumped to the high teens.

Ancillary services like pharmacy and optical rebounded, benefiting from a holiday lift, and even electronics like TVs saw sequential improvement.

2025 & Beyond: $1,065 In Sight

Looking ahead, Horvers remains optimistic, maintaining an Overweight rating on the stock, though he adjusted the price target slightly to $1,065.

Costco's unique ability to grow "across its box and geographies," coupled with its emerging advertising revenue stream, makes it a standout in retail. "The COST fundamental story challenges all of the best companies," Horvers emphasized.

For investors, Costco's momentum appears unstoppable. In a world where growth is hard to come by, Horvers said it best: "Aside from AMZN, no scaled retailer is growing at this pace."

The retail king is poised to stay on its throne, and for shareholders, the journey to $1,065 looks well within reach.

Read Next:

• Charlie Munger’s Top Pick Costco Reports Strong December Sales: Analysts Expect A 7% Jump In January

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