A top Costco executive sounded the alarm on the potential consequences of President-elect Donald Trump’s proposed tariffs — warning that it will raise prices of goods across the board.
“When it rains, it rains on everybody,” Gary Millerchip, the chief financial officer of the $447 billion big-box retailer, told investors on an earnings call on Thursday.
“Of course, tariffs raise costs. That’s not something that we see as a positive in general.”
The CFO said that it was unclear what impact Trump’s planned tariffs will have on the “timing and scope of changes” at Costco and other retailers.
Millerchip’s comments were reported over the weekend by Fortune.
Trump transition officials dismissed Millerchip’s concerns.
“President Trump has promised tariff policies that protect the American manufacturers and working men and women from the unfair practices of foreign companies and foreign markets,” Brian Hughes, a spokesperson for the Trump transition, told The Post on Monday.
“As he did in his first term, he will implement economic and trade policies to make life affordable and more prosperous for our nation.”
Trump has declared his plans to impose tariffs on imports from several countries upon taking office on Jan. 20 — including plans to slap a 25% levy on all goods entering the US from Mexico and Canada.
Canadian officials have threatened to retaliate by banning imports of US-made liquor as well as cutting off power to millions of American homes.
Trump said he also wants to impose an additional 10% tariff on all products from China — on top of existing tariffs.
The tariffs would be implemented via executive order and do not necessitate approval from Congress.
Trump has demanded that countries do more to crack down on the flow of undocumented migrants into the US as well as the increased incidences of drug trafficking that have been blamed for the rise in fentanyl use among Americans.
Karoline Leavitt, a spokeswoman for the Trump transition team, said that tariffs against China that the then-president implemented in his first term “created jobs, spurred investment, and resulted in no inflation.”
“President Trump will work quickly to fix and restore an economy that puts American workers first by re-shoring American jobs, lowering inflation, raising real wages, lowering taxes, cutting regulations, and unshackling American energy,” Leavitt told The Post.
Costco beat first-quarter revenue and profit expectations on Thursday as its bulk and discounted offerings, appealing to budget-conscious American shoppers, drove early holiday-season sales growth for the membership-only retailer.
The company’s shares, which are up 51% so far this year, rose nearly 2% in trading on Monday.
“Seasonal sell-through appears to be very strong… people are very basic buying this year, but good trends,” Millerchip said.
Costco ran pre-Black Friday sales in early November, trying to dodge a hit to sales in the first quarter ended Nov. 24 this year, from the late Thanksgiving weekend, which extended into December.
It has offered products at heavy discounts, such as an LG UltraGear Gaming Monitor for $179, $70 lower than its original price, and JBL headphones for a 30% discount, at $69.99.
Bigger rival Walmart, which has also been offering higher discounts and promotions, raised its annual sales and profit forecast in November for the third time this year, signaling strong consumer spending.
Costco’s first-quarter revenue rose 7.5% to $62.15 billion, beating analysts’ estimate of $62.08 billion, according to data compiled by LSEG.
With Post wires
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