Costco Wholesale

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said it expects second-quarter earnings to be "substantially below" analyst forecasts of 70 cents a share as sales have been hurt by the weaker economy.

"General economic conditions have negatively affected our sales, primarily in non-foods, and merchandise margins," said Richard Galanti, chief financial officer. Costco said its margins also have been impacted by "aggressive merchandise pricing" in its core merchandise business in an effort to drive sales and increase market share.

Costco also has seen lower profits in its gasoline business and international profits have slumped because of the stronger dollar.

The warehouse retailer said it won't provide guidance for the remainder of the year because of "uncertainties surrounding the economy, including consumer behavior."

Costco said same-store sales for the four weeks ended Feb. 1 fell 2%, while total sales in January declined slightly to $5.10 billion from $5.11 billion a year earlier.