Costco was seen at the time as taking a big risk by being the most prominent U.S. company to publicly oppose President Trump, on his signature issue at that, at a time many CEOs seemed (as they still do) to live in terror of landing in the president’s crosshairs. Still, this was not an ideological move, but rather a classic Costco business move.
In its filing last December with the U.S. Court of International Trade, Costco said its lawsuit was intended to ensure it was eligible for a full refund if the Supreme Court rejected the administration’s rationale for tariffs collected under the International Emergency Economic Powers Act. The suit made headlines that have only strengthened Costco’s reputation for looking out for its customers.
Trump later in the day responded to the decision by announcing new 10% global tariffs under a different statutory authorization.
Costco, which posted revenue of $275 billion in its most recent fiscal year, has said a number of times that it has managed to cope with the tariffs, changing up its assortment when a new tariff made an item too pricey. “Our buyers continue to do an excellent job finding new and exciting items at great values while also adjusting our assortment to minimize the impact of tariffs,” Costco CFO Gary Millership told Wall Street analysts on an earnings call in December. Costco did not immediately respond to a request comment on the Supreme Court decision.
“As our membership diversifies, we believe that serving it with a diverse group of employees enhances satisfaction … And we believe (and member feedback shows) that many of our members like to see themselves reflected in the people in our warehouses with whom they interact,” the company said in a statement last year in response to an activist shareholder’s anti-DEI proposal. The takeaway with Costco always amounts to: “Let us run our business as we see fit.”
Costco has endured “Go woke, go broke” boycott threats, but the retailer’s business has continued to thrive in recent years. It turns out that many Trump supporters are members too, and as such they’re like most Costco aficionados: too addicted to Costco’s knack for surprising merchandise and staples at attractive prices to give it up.
That brings us right back to why Costco took the lead among major retailers to fight the tariffs in the first place: maintaining its options for which merchandise it sells and protecting its ability to keep prices low.
