Less dining out lifts Costco sales, U.S. memberships

Costco has recorded higher traffic and larger baskets at U.S. warehouses and online in recent quarters because U.S. consumers are dining out less and preparing more meals at home. Shoppers increased purchases of groceries, bulk staples and prepared foods, and membership sign-ups and renewals rose.

Sales gains were strongest in refrigerated and frozen items, pantry staples, household essentials and private-label Kirkland Signature products. Fuel station purchases have contributed to repeat visits, while higher-margin discretionary categories showed mixed results.

Company reports and retail data point to rising restaurant prices and persistent grocery inflation before the shift. Many shoppers opted for lower per-unit costs by buying larger packs and cooking at home, reducing the frequency of dining out and increasing demand for meat, dairy, canned goods and frozen items.

Membership revenue grew as new customers joined to access lower prices and existing members renewed at higher rates. Annual fees provide a steady source of income that supports low retail markups and store operations.

Costco is adjusting inventory levels in U.S. warehouses to meet demand for value-priced branded goods, Kirkland Signature items and bulk formats. The increase in grocery sales and memberships has been most visible at U.S. locations.