Costco (COST) , the biggest warehouse membership within the U.S., is seeing its membership numbers skyrocket as its merchandise and offers proceed to achieve traction on social media.
Throughout the first quarter of 2025, Costco noticed its paid family membership numbers enhance to 78.4 million, up 6.8% in comparison with the identical quarter final yr.
Costco’s comparable gross sales within the U.S. additionally spiked by 8.3% year-over-year throughout the quarter. It even outperformed its opponents by drawing in greater foot visitors in its shops.
In keeping with latest information from Placer.ai, Costco’s foot visitors spiked by 6% year-over-year, whereas Sam’s Membership’s solely elevated by 2.7% and BJ’s climbed 4%.
Regardless of elevated gross sales and foot visitors, Costco Chief Monetary Officer Gary Millerchip warned throughout an earnings name in Could that members “remain very choiceful in their spending on discretionary items” amid greater prices of dwelling and the rising risk of tariffs.
Costco cuts a serious line of merchandise amid regarding buyer conduct.
Picture supply: VIEWpress/Getty Pictures
Costco seems to chop ties with a well-liked product line
As customers turn into extra cautious about what they spend their cash on, Costco has quietly eliminated Xbox consoles from its web site. It now solely sells Sony and Nintendo gaming units, such because the PS5 and Nintendo Swap.
Over the previous few weeks, some Costco members have taken to social media to flag that Xbox merchandise have slowly disappeared from the warehouse membership’s web site and shops.
“Typically my wife and I buy Game Pass gift cards at Costco when it’s time to renew. We need to reup and to our dismay, the Costco app is showing ZERO Xbox items not consoles, not games, and no cards,” wrote one Costco member in a Reddit submit.
“I just went to our store yesterday and nothing Xbox in sight,” wrote one other.
Whereas Costco hasn’t supplied a motive for the latest disappearance of Xbox merchandise, it could be on account of low shopper demand.
Associated: Costco quietly limits buyer purchases of a beloved product
Millerchip warned traders throughout an earnings name in December final yr that Costco might reduce stocking up on low-performing merchandise in shops to assist mitigate the excessive prices related to President Donald Trump’s tariffs.
“When it rains, it rains on everybody,” said Millerchip during the call.
Microsoft revealed in its latest earnings report that Xbox sales have been struggling. It flagged that while Xbox content and service revenue increased by 18% year-over-year, Xbox hardware revenue dropped by a whopping 22%.
During an earnings call on July 30, Microsoft Chief Financial Officer Amy Hood said that the company expects Xbox demand to shrink over the next few months.
“We expect Xbox content and services revenue to decline in the mid single digits,” said Hood.
Xbox recently announced major price changes, threatening future sales
The low demand for Xbox products comes after Microsoft hiked the prices of multiple Xbox gaming consoles in the U.S. earlier this year, shortly after Trump announced massive tariff rates on China and several other countries where Xbox devices are manufactured.
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Xbox prices went up globally for the first time this year in May, with some devices increasing by $100.
On Sept. 19, Microsoft again announced on its website that Xbox Series S and Series X consoles will increase in price in the U.S., starting Oct. 3, “due to changes in the macroeconomic environment.”
The new prices are listed below.
- Xbox Series S 512: $399.99 (up from $379.99)
- Xbox Series S 1TB: $449.99 (up from $429.99)
- Xbox Series X Digital: $599.99 (up from $549.99)
- Xbox Series X: $649.99 (up from $599.99)
- Xbox Series X 2TB Galaxy Black Special Edition: $799.99 (up from $729.99)
“We understand that these changes are challenging, and they were made with careful consideration,” said Microsoft on its website.
Many consumers have been pulling back their spending as they grow concerned about tariffs raising prices for everyday goods.
According to a recent report from market research company Wunderkind, 58% of consumers “feel cautious, pessimistic, or panicked about the economy.”
These worries have caused 35% of consumers to seek more deals while shopping, 31% to purchase fewer nonessential items and 31% to shop less overall.
Consumer sentiment is also declining nationwide. According to recent data from the University of Michigan, consumer sentiment decreased by 4.8% this month, compared to August, its lowest point since May.
“Consumers continue to note multiple vulnerabilities in the economy, with rising risks to business conditions, labor markets, and inflation,” said University of Michigan Surveys of Consumers Director Joanne Hsu in a statement. “Likewise, consumers perceive risks to their pocketbooks as well.”
Associated: BJ’s suffers a regarding loss as clients swap gears
