Costco Adds Members, Increases Profits in Positive Start to 2022

Costco kicks off the 2022 fiscal year with strong first-quarter earnings.

The warehouse retailer published its first-quarter earnings for 2022, reporting more members and higher profits. Despite supply chain disruptions, labor crunches and inflation, the warehouse retailer has managed to keep consumers happy and keep shelves stocked.

Net income from the quarter ended $1.324 billion, up from $1.166 billion in the same period last year. In the U.S. the average ticket or transaction was up 8.5% during the quarter, Richard Galanti, Costco’s executive vice president and CFO, said during the company’s earnings call last week.

Warehouse retailers have been a key player throughout the COVID-19 pandemic as consumers stocked up on groceries and household goods. Many consumers made fewer trips to stores during the pandemic and ended up with bigger baskets, which warehouse retailers could support through their bulk quantities. Costco has been gaining members, reporting total paid households was 62.5 million, up 800,000, from 61.7 million a quarter ago.

The retailer did report slightly lower margins, thanks in part to lower margins for fresh foods. However, Galanti was bullish on the margins, calling them “pretty good” in the face of inflationary pressures and efforts to mitigate price increases. 

Foot traffic at the retailer has been up every month for 2021, according to a recent report on Costco’s foot traffic from data company Visits were up 5.1% in September, 12.4% in October and 3.9% in November, found.

“Costco’s strength has continued to impress with visits up each month in 2021 compared to 2019,” Ethan Chernofsky, vice president of marketing at, said in the report. “The brand has a unique ability to create a ‘sticky’ experience that drives loyalty and repeat visits. This has proven to be a powerful asset in 2021 and should serve as the foundation for further growth in 2022.”

While more people are visiting Costco stores, the retailer is grappling with supply chain issues like many others. Delayed inventory due to port congestion and transportation bottlenecks are causing some stock issues with certain products that are in high demand. The retailer reported about 79% of its import containers are late by an average of 51 days, impacting virtually every department. Costco has ordered its products earlier to work around the delays, but the longer lead times can’t fix everything.

“In some instances, delayed inventory simply extends the season. An example might be lawn and garden and patio,” Galanti said. “As soon as the product arrives, it sells pretty quickly, but it may extend into––beyond the normal seasonal time. Toys and seasonal, in fact, same thing, some inventory, in fact, won't make it before Christmas, but we've mitigated that as best as possible and feel pretty good about it.”

Costco operates 828 warehouses, including 572 in the U.S.