Costco (Nasdaq: COST) shares are on watch as the company says it is planning to raise its employees' wages.

According to Bloomberg, citing commentary from Costco's conference call, this will be the first pay hike for the company since 2007. Costco believes that the increase will hit Q3 EPS by about 1 cent.

Shares of Costco are down over 2 percent Thursday following its quarterly results announcement.