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When is Costco raising its membership fees? Here’s what you should know

In a recent earnings call, Costco CFO Richard Galanti gave insight into when and how Costco determines the right time to raise membership fees. (Getty Images)

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(NEXSTAR) – The price of a Costco membership isn’t increasing just yet, but it’s going to happen “at some point” in the not-too-distant future, Costco’s chief financial officer suggested in a recent earnings call.

During the meeting, Costco CFO Richard Galanti responded to a UBS analyst who asked about the possibility of a membership price hike in 2022, “especially in light of companies like Amazon and Netflix raising their fees” earlier this year.

Galanti, also the executive vice president and director of Costco, said the company wasn’t looking at what Amazon or Netflix was doing, but did provide a bit of insight into how, and perhaps when, Costco would raise its annual fee.

“[When we] look at ourselves in the mirror, do we feel that we’ve continued to increase the value of the membership?” Galanti said. “Certainly we look at renewal rates. We look less at what others do, frankly. But certainly, it is out there, what others are doing.”

Galanti added that Costco had raised its membership fees three times over the last 15 years, or approximately once every “five years and seven months,” on average.

“And five years from the anniversary of the June of ‘17 will be this June,” Galanti said, referring to the last time Costco raised fees (up from $55 to $60 for Gold Star members) in 2017.

“So I think the question will continue to be asked until we do or don’t do something.”

If the intervals between Costco’s previous increases hold steady, customers may not have to worry about higher membership fees until 2023. Galanti, however, did not reveal any specifics on when or if Costco had plans to raise fees along that same timeline.

“You guys will know when we tell you, and at some point it will happen. But stay tuned,” he said.

The revenue generated from Costco memberships, meanwhile, totaled $967 million in the 12 weeks leading up to Feb. 13, 2022, or approximately $86 million more than what was generated in the 12 weeks leading up to Feb. 14, 2021, per Costco’s latest earnings report.

Galanti also said renewal rates were increasing, a benefit he credited partially to customers who choose to auto-renew. He also said Costco has seen an increasing number of Executive members, who “renew at a higher rate” than Gold Star or Business members.

An annual membership to Costco currently costs $60 per year for Gold Star and Business members, and $120 per year for Executive-level members.

Business

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