On Thursday, Costco Wholesale (NASDAQ: COST) has announced fourth quarter earnings during after-hours. The American membership-only warehouse club that provides a wide selection of merchandise had reported EPS of $1.77 on revenues of $35.73 billion, compared to consensus estimates EPS of $1.73 on revenues of $36.81 billion.
Investors were pleased that Costco’s quarterly profits were boosted by lower credit card fees and other terms from its new agreement to admit Visa-brand cards, substituting an enduring alliance with American Express.
Richard Galanti, Executive Vice President and Chief Financial Officer of Costco said about 11.4 million co-branded American Express cards, which symbolized about 7.4 million accounts, had been moved to new Visa Citi cards, and around 85% of those accounts have now been activated with the company. Additional 1.1 million members have applied for the new card since late June.
Costco ended its 2016 fiscal year and currently operates 715 warehouses, including 501 in the United States and Puerto Rico, 91 in Canada, 36 in Mexico, 28 in the United Kingdom, 25 in Japan, 12 in Korea, 12 in Taiwan, eight in Australia and two in Spain. The Company plans to open up to an additional nine new warehouses (including one relocation) before the end of calendar year 2016. Costco also operates e-commerce web sites in the United States, Canada, United Kingdom, Mexico, Korea and Taiwan.