What You Need To Know Ahead of Costco’s Earnings

Key Metric: Memberships

Costco, like other warehouse retailers including BJ’s Wholesale Club (BJ) and Walmart’s (WMT) Sam’s Club, uses memberships to provide access to its stores, which helps Costco generate revenue before a shopper sets foot in the store. Since 2017, Costco memberships, which come in two price tiers, have cost $60 per year for the “Gold Star” and business memberships, and $120 per year for the executive membership.

However, company leadership has said several times in recent quarters that Costco has passed the average amount of time it usually takes between membership price hikes, and suggested it’s a matter of “when, not if” membership prices go up. Investors will likely be watching closely whether Costco provides more details on its plans for membership pricing when the company reports earnings.

Analysts expect memberships to have climbed slightly in the quarter to 73.55 million, up from 73.4 million last quarter, and 69.1 million a year ago.

Business Spotlight: Uber Eats Partnership, First Report With New CFO

In the weeks ahead of Costco’s earnings announcement, its market potentially grew thanks to a new partnership with Uber Technologies (UBER) that the ridesharing company announced in its annual event May 15.

Costco has experimented with delivery through Uber Eats in test areas like Texas, and has an existing partnership with Instacart that allows members to order products for same-day delivery.

Through the new partnership, Uber Eats users will be able to order Costco products through the app, whether they are Costco members or not, a significant step for Costco as it is protective of its members-only shopping experience, cracking down on membership sharing over the last year.

However, Uber said Costco members will receive special discounts, and can also get 20% off a year-long Uber One membership, Uber’s subscription service that offers discounts on rides and free delivery on Uber Eats orders. Uber said during its event that the service would be available in multiple markets across the U.S. and several other countries where Costco operates, with plans to expand further.

Thursday will also be Costco’s first earnings report under its new CFO, after former Kroger (KR) CFO Gary Millerchip took over the position last month. Galanti, who had served in the role for nearly 40 years, is remaining with Costco in an advisory capacity through January 2025.

Costco shares have gained close to 21% so far this year, at $796.34 as of market close on Thursday, May 23, after hitting a record intraday high of $808.05 earlier in the session.