Costco (NASDAQ: COST), known for its bulk deals on everything from toilet paper to snacks, has taken another step in its growing portfolio of precious metals. Following the soaring success of its gold and silver sales, the retailer announced on Wednesday that it will begin selling 1-ounce platinum bars, with the first bars going for $1,089.99 each.
Additionally, the company is offering a 1-ounce Canada Maple Leaf platinum coin at the same price. These new products will be available exclusively online and cannot be shipped to Louisiana, Nevada, or Puerto Rico, according to Costco’s terms.
The platinum bars and coins are not eligible for returns or refunds — an echo of Costco’s strict policy for all precious metals sold, which the retailer deems non-returnable. As with the company’s other exclusive products, only Costco members, who pay an annual fee ranging from $65 to $130, can make these purchases.
The value of platinum has increased by more than 15% over the last year, closing at $1,006 per ounce on Wednesday, making the entry of this metal into Costco’s product lineup a timely addition for investors looking to diversify their portfolios.
Costco’s venture into precious metals began with gold bars in August 2023, which quickly became a lucrative business. According to Richard Galanti, Costco’s then-Chief Financial Officer, the gold bars would sell out within hours of being listed on the website.
“I’ve gotten a couple of calls that people have seen online that we’ve been selling 1-ounce gold bars,” Galanti noted in a September earnings call. “When we load them on the site, they’re typically gone within a few hours, and we limit two per member.”
Wells Fargo analysts estimated that Costco’s gold sales reached between $100 million to $200 million a month since the offering began. The company priced these gold bars slightly above the spot price, attracting customers with executive membership benefits that include a 2% cashback reward and an additional 2% for those using a Citi card.
As of the recent close, gold has been trading at $2,660.24 an ounce, up nearly 80% over the last five years. The demand for gold has been driven in part by global economic uncertainties, including rising inflation, geopolitical tensions, and mixed economic indicators.
Gold is traditionally seen as a “safe-haven” asset, and its popularity among investors has only increased amidst recent global events, such as heightened conflict in the Middle East.
Before entering the platinum market, Costco tested the waters with another precious metal: silver. In March 2024, the company began selling 2024 Canada Maple Leaf silver coins and 10-ounce Royal Canadian Mint silver bars.
The decision to add silver to its offerings proved successful, boosting the company’s online sales metrics significantly. “In terms of e-commerce, e-commerce sales in Q2 ex-FX increased 18.2%. E-com showed strength in several areas, led by sales of gold and very recently silver,” said Galanti in an earnings call.
However, not all feedback was positive; some customers reported scratched coins due to unsealed packaging, prompting complaints about quality control. As with all precious metal sales at Costco, the no-return policy applied, with purchases limited to five cases per membership.
Information for this briefing was found via New York Post and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
