Costco said on Thursday it would reduce prices for members if it receives refunds on tariffs previously paid, following a recent US Supreme Court ruling that struck down emergency duties imposed under former president Donald Trump’s trade policy.

The warehouse retailer was among more than 1,000 businesses that challenged the tariffs in court, arguing the administration lacked authority to impose them under the 1977 International Emergency Economic Powers Act. The Supreme Court ruled last month that the law did not permit the president to introduce tariffs, opening the possibility of companies seeking reimbursement for duties already paid.

Speaking on a post-earnings call, chief executive Ron Vachris said the retailer would return any recovered funds to customers through lower prices or stronger value in stores. “Our commitment will be to find the best way to return this value to our members through lower prices and better values,” he said. Vachris added that the situation remains uncertain, noting that “it is not yet clear what the process will be, what refunds, if any, will be received, and when this will happen.”

Costco has already lowered prices on some goods such as textiles, bedding and cookware after tariffs were reduced on imports from countries including China following the court decision. Executives said the company had previously absorbed part of the tariff impact rather than passing the full cost on to customers.

The ruling comes as large retailers compete to attract shoppers who are increasingly focused on value as living costs remain elevated. Warehouse chains and discount retailers have drawn customers from a wide range of income groups by emphasising lower prices and private label goods.

Costco reported second-quarter revenue of $69.6 billion and earnings per share of $4.58, narrowly exceeding analysts’ expectations. Same-store sales excluding fuel rose 6.7 per cent, above the 5.88 per cent increase forecast by analysts surveyed by LSEG.

Net income for the quarter increased nearly 14 per cent to $2.04 billion. The retailer’s shares were largely unchanged in premarket trading following the results.

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