Costco targets the high-middle-class families, who have the income and space to buy bulk. And by making up in volume and high-end products [1] Costco can afford to "not be evil".

[1] - One not very well-known facts about Costco is that a big part of their profit comes from the high-end "novelty" stuff that they put in between the cheap bulk items. That works for them because people who shop at Costco have high disposable income.