Costco Wholesale reported a first-quarter profit that was little-changed and said analysts' earnings estimates for the current period are "high" because the retailer's sales are slowing.

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Costco Wholesale reported a first-quarter profit that was little-changed and said analysts’ earnings estimates for the current period are “high” because the retailer’s sales are slowing.

Wall Street’s 75-cent-a-share profit estimate for the second quarter, which started Nov. 24, is “on the high side,” Costco Chief Financial Officer Richard Galanti said Thursday on a conference call. He declined to affirm the warehouse-club chain’s full-year projection of at least $3 a share, saying it was “very hard” to predict future growth.

The Issaquah company’s higher-income customers are feeling the effects of shrinking values in their homes and stock holdings, increasing job losses and the U.S. recession. Sales rose just 3.7 percent to $16.39 billion in the first quarter, compared with an 11.7 percent gain in the year-earlier period.

“Costco, like everyone from Wal-Mart to Neiman Marcus, is being hurt by the consumer’s pullback on discretionary spending,” said Patricia Edwards, founder of Storehouse Partners.

Net income for the quarter ended Nov. 23 rose less than 1 percent to $262.5 million, or 60 cents a share, from $262 million, or 59 cents a share, a year earlier, Costco said. The results include charges of 5 cents a share related to an accounting adjustment stemming from life-insurance contracts and a write-down on corporate investments.

Analysts polled by Thomson Reuters, on average, predicted a profit of 62 cents a share on revenue of $16.6 billion. Analyst estimates typically exclude one-time items.

Sales growth slowed because of lower fuel prices, the dollar’s gain against other currencies and waning demand for jewelry and other pricier items.

“Food is driving our business as it is others,” Galanti said on a call with analysts and investors.

Costco said consumers pulled back on spending on nearly all items outside of food, especially in the later part of the quarter, despite more aggressive pricing.

“I think people’s habits have changed,” Galanti said.

The only exception in the trend away from nonfood items was an uptick in television sales in November, thanks to a glut of inventory at some vendors, which allowed Costco to lower prices.

But Costco is enjoying less of an advantage as a discount destination this holiday, said David Abella, a portfolio manager at Rochdale Investment Management.

“The price promotion at other retailers has been so aggressive that the relative value at Costco for holiday shopping isn’t as great,” said Abella, whose New York firm oversees $2 billion in assets.

Costco said international results, mainly in Canada, the U.K. and South Korea, were hurt by the stronger dollar. Costco operates 550 warehouses in the U.S. and Puerto Rico, Canada, the U.K, Korea, Taiwan, Japan and Mexico.

Costco’s shares closed down $1.63, or 3 percent, at $52.06 Thursday. The shares have dropped 25 percent this year, compared with a 33 percent retreat by the Standard & Poor’s 500 retailing index.

Information from Bloomberg News and The Associated Press is included in this report.