A Costco Wholesale warehouse sign is seen outside a store in Silver Spring, Maryland, on August 5, 2023
Almond Ngan | Afp | Getty Images
Costco‘s longtime CEO Craig Jelinek is stepping down from the company after the warehouse club experienced a wave of growth driven by the pandemic and inflation.
The company announced Wednesday that Ron Vachris, the company’s chief operating officer, will succeed him. The change takes effect on January 1st.
In a news release, Costco said the two executives had worked together for the past two years. It described the move as “the culmination of many years of succession planning.”
Shares remained unchanged in after-hours trading. So far this year, the company’s shares have risen 26%, outpacing the gains of both the S&P 500 and most other publicly traded retailers.
Costco has benefited from sales growth, particularly from customers who have stocked their pantries and cooked more during the pandemic and, more recently, sought relief from inflated grocery and gasoline prices. Warehouse clubs, including rivals WalmartSam’s Club-owned business has also received a boost from millennials moving to the suburbs.
Over the past year, the retailer’s sales have largely held up – although there have been declines in some discrete categories such as jewelry and electronics. In the most recent fiscal quarter, which ended in early September, shoppers visited more but spent less.
Costco’s average transaction volume fell nearly 4.5% in the U.S. during the quarter, even as traffic rose 5% year-over-year.
Vachris, the new CEO, began his career at Costco as a forklift operator. He has been with the company for more than 40 years.
Jelinek has been at the helm of the Warehouse Club since January 2012. He will remain at Costco in an advisory role through April. He also plans to remain on the board, the company said.
Separately, the company said Wednesday that its board had approved a quarterly cash dividend on Costco common stock of $1.02 per share, to be paid in mid-November.