Pricesmart 2025 Q3 Earnings Strong Performance as Net Income Grows 8.2%

Pricesmart (PSMT) reported its fiscal 2025 Q3 earnings on Jul 10th, 2025. The company achieved a notable 8.2% increase in net income, reaching $35.16 million compared to $32.49 million in the same quarter last year. Pricesmart's earnings per share (EPS) also rose to $1.14, surpassing analyst expectations of $1.09. Looking forward, the company raised its guidance, projecting total revenues to exceed $5.25 billion for the fiscal year, and EPS of approximately $4.80, signaling a positive outlook on consumer spending and operational efficiencies.

Revenue

PriceSmart reported a 7.1% increase in total revenue for 2025 Q3, reaching $1.32 billion, up from $1.23 billion in the previous year. This growth was driven by net merchandise sales, which totaled $1.29 billion, reflecting robust consumer demand and strategic pricing initiatives. Export sales contributed $990,000, membership income reached $21.86 million, and other revenue and income added $4.45 million, collectively supporting the overall revenue growth.

Earnings/Net Income

Pricesmart's EPS rose 5.6% to $1.14 in 2025 Q3 from $1.08 in 2024 Q3, marking continued earnings growth. Meanwhile, the company's profitability strengthened with net income of $35.16 million in 2025 Q3, marking 8.2% growth from $32.49 million in 2024 Q3. PriceSmart's EPS performance reflects solid growth and operational strength.

Price Action

The stock price of PriceSmart has edged up 0.74% during the latest trading day, has dropped 3.61% during the most recent full trading week, and has dropped 5.07% month-to-date.

Post-Earnings Price Action Review

The strategy of purchasing PriceSmart shares following a quarter-over-quarter revenue increase at the financial report release date and holding for 30 days yielded moderate returns but fell short of the market performance. The strategy's compound annual growth rate (CAGR) was 11.04%, lagging behind the benchmark by 17.57%. With a maximum drawdown of -41.74% and a Sharpe ratio of 0.39, this approach highlighted a challenging risk-return profile. These results underscore the necessity of robust risk management in volatile investment scenarios.

CEO Commentary

PriceSmart, Inc. CEO highlighted the company’s robust performance in the third quarter of fiscal year 2025, noting a 7.1% increase in total revenues to $1.32 billion. He emphasized that net merchandise sales grew by 8.0%, driven by strong consumer demand and strategic pricing initiatives. The CEO acknowledged challenges related to foreign currency fluctuations, which negatively impacted sales, but expressed optimism about the company's operational resilience. He also shared insights on the strategic expansion into new markets, including the planned opening of additional warehouse clubs in Guatemala and the Dominican Republic, reinforcing PriceSmart's commitment to growth and member value.

Guidance

Looking ahead, PriceSmart anticipates continued revenue growth, projecting total revenues to exceed $5.25 billion for the fiscal year. The company expects earnings per share (EPS) to reach approximately $4.80, reflecting a positive outlook on consumer spending and operational efficiencies. PriceSmart is committed to investing in new warehouse locations, with capital expenditures (CAPEX) estimated at $30 million for the upcoming fiscal year, as it aims to enhance its market presence and drive long-term growth.

Additional News

In recent weeks, PriceSmart announced significant C-Level changes, including the appointment of Gualberto Hernandez as CFO following Michael McCleary's retirement. Additionally, PriceSmart declared an 8.6% increase to its annual dividend, reflecting confidence in its cash-generating activities. The company also revealed plans to open a sixth warehouse club in the Dominican Republic, strategically expanding its footprint in the Caribbean. These developments indicate PriceSmart's commitment to enhancing shareholder value and expanding its market presence.