ISSAQUAH, Wash.-The poor economy, higher markdowns and weak performance of non-food categories conspired to push Costco’s net income down 27 percent in the second quarter, although small electrics emerged as a bright spot, said Richard Galanti, chief executive officer, during a conference call.
For the second quarter ended Feb. 15, Costco’s net income fell 27 percent to $239.7 million from the year ago period. Net sales fell one percent, to $16.49 billion. Comp-store sales fell 3 percent.
Although there was “not a whole lot thrilling” about the performance of bigger-ticket goods, such as garden furniture, and softlines, small electrics “was a surprising standout,” Galanti said, singling out coffeemakers, toaster ovens and FoodSaver food storage. He added that those categories were helped by direct mailers.