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Pandemic panic-buying helps profits surge at Burnaby Costcos

Lineups have gotten longer during periods where COVID-19 case numbers have jumped
Costco lineup
MARCH: Customers wait outside a Costco in Burnaby, B.C, on Tuesday, March 17, 2020. Roughly 40 shoppers stand outside a Costco to stock up on supplies.

If you’ve shopped at or passed by either of the Burnaby Costco locations during the COVID-19 pandemic, you’ll have witnessed various stages of panic buying by some customers.

As cases have risen and fallen – and then risen and risen and risen again – people have expressed their fears through their shopping habits.

When people fear breakdowns in supply chains and extended periods of being stuck at home, it’s natural for people to stock up on essential items such as food. And, yes, toilet paper.

That’s meant Costco has seen a surge in business and long lineups outside of the stores on Brighton or Still Creek in Burnaby. It’s also meant that Costco staff have had to post signs of items they had run out of, although that was mostly during the early days of the pandemic.

Costco Wholesale said earlier this week that its fourth-quarter profits rose from a year ago, although its profits were weighed by wage premiums paid to employees during the pandemic.

In a quarter during which Costco saw a surge of online shopping, the company based in Issaquah, Washington, said it earned $951 million, or $2.14 per share. That's compared to a profit of $931 million, or $2.10 per share, in the same period a year earlier.

But the results were below analysts’ expectations, pushing the Costco's stock down about 2% in after-hours trading.

The average estimate of 13 analysts surveyed by Zacks Investment Research was for earnings of $2.42 per share in the latest quarter.

Costco said the premium COVID-19 pay for its employees trimmed its profits by 41 cents per share.

Costco has been one retailer that has mostly benefited from the pandemic, as stay-at-home Americans stocked up on bulk goods. The company also is seeing a jump in online shopping, notable for the chain mostly known for its mammoth warehouse stores.

E-commerce revenues were up 75% from a year earlier in the quarter that ended Feb. 14.

The warehouse club operator posted total revenue of $44.77 billion in the period, exceeding Street forecasts. Six analysts surveyed by Zacks expected $44.5 billion.

  • With files from the Canadian Press