Financial Data and Key Metrics Changes - Net income for Q1 2026 was $2.001 billion, or $4.50 per diluted share, up from $1.798 billion, or $4.04 per diluted share in Q1 2025, reflecting a 13.6% growth excluding discrete tax items [14][15] - Net sales increased by 8.2% to $65.98 billion from $60.99 billion in the previous year, with comparable sales growth of 6.4% [15][16] - Membership fee income rose to $1.329 billion, a 14% increase year over year, driven by membership growth and fee increases [16][17] Business Line Data and Key Metrics Changes - Digital sales saw a significant increase, with digitally enabled comparable sales growing by 20.5% [15][25] - Fresh sales were up mid to high single digits, with double-digit growth in meat categories [22][24] - Non-foods had comparable sales in the mid-single digits, with strong performance in categories like gold jewelry and health and beauty [23][24] Market Data and Key Metrics Changes - Traffic increased by 3.1% worldwide, and average transaction size rose by 3.2% [15] - The U.S. and Canada renewal rate was 92.2%, and the worldwide rate was 89.7%, both slightly down from the previous quarter [17] - Digital engagement metrics showed a 24% increase in website traffic and a 48% increase in app traffic [25][78] Company Strategy and Development Direction - The company plans to open 30-plus new warehouses annually in the future, with a total of 921 warehouses worldwide [5][6] - A focus on technology integration aims to enhance member experience and operational efficiency, including AI applications in inventory management [10][56] - The company is committed to maintaining competitive pricing while investing in technology and member services [34][54] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in consistent sales growth patterns despite some monthly fluctuations due to external factors [39] - The company is optimistic about future expansion opportunities, particularly in international markets [64][84] - Management acknowledged challenges with healthcare costs impacting productivity but remains focused on leveraging SG&A in the future [92][93] Other Important Information - Capital expenditures for Q1 were approximately $1.53 billion, with an estimated $6.5 billion for the full year [20][22] - The company reported record sales in various categories during the holiday season, including a significant increase in food court sales [22][27] - The company continues to adapt its product assortment to mitigate tariff impacts and enhance value for members [28][29] Q&A Session Summary Question: Observations on Costco's willingness to embrace technology and reinvestment strategies - Management confirmed a focus on technology integration and emphasized the importance of maintaining competitive pricing for members [32][34] Question: Concerns about traffic and the need to invest in pricing - Management noted consistent sales growth patterns and emphasized the importance of delivering value and quality to members [39][41] Question: Membership growth strategies with upcoming warehouse openings - Management indicated a balanced approach to new openings, focusing on both established and new markets [46][48] Question: Insights on retail media and digital advertising opportunities - Management acknowledged the potential of retail media and emphasized the importance of enhancing member experience through targeted marketing [50][52] Question: Warehouse openings and remodel philosophy - Management highlighted a strong pipeline for international growth and discussed the significant uplift from warehouse relocations and remodels [84][86] Question: Dynamics of SG&A leverage and productivity outlook - Management discussed headwinds affecting productivity, including healthcare costs, but expressed optimism about future leverage opportunities [92][93]

ISSAQUAH, Wash., Dec. 11, 2025 (GLOBE NEWSWIRE) -- Costco Wholesale Corporation (“Costco” or the “Company”) (Nasdaq: COST) today announced its operating results for the first quarter of fiscal 2026 (twelve weeks), ended November 23, 2025. Net sales for the first quarter increased 8.2 percent, to $65.98 billion from $60.99 billion last year. Comparable sales for the first quarter fiscal 2026 were as follows: 12 Weeks 12 Weeks Adjusted* U.S.5.9% 5.9% Canada6.5% 9.0% Other International8.8% 6.8% Tota ...

Costco Wholesale Corporation (NASDAQ:COST) will release earnings results for the first quarter after the closing bell on Thursday, Dec. 11.Analysts expect the Issaquah, Washington-based company to report quarterly earnings at $4.28 per share. The consensus estimate for Costco's quarterly revenue is $67.17 billion, compared to $62.15 billion a year earlier, according to data from Benzinga Pro.The company has beaten analyst estimates for revenue in three straight quarters and in six of the last 10 quarters ov ...

Core Insights - Costco Wholesale exceeded fourth-quarter revenue and profit expectations as consumers sought lower-priced essentials amid inflation and a weakening labor market [1][5] - The company's strategy of limited product categories and local sourcing has helped mitigate the impact of tariffs from the Trump administration's trade policies [2] - Strong sales of private-label brands and maintaining lower prices on key items contributed positively to Costco's performance [3] Financial Performance - Costco reported revenue of $86.16 billion, surpassing analysts' average estimate of $86.06 billion [5] - Same-store sales, excluding gas, increased by 6.4%, slightly below the estimated 6.44% [5] - Earnings per share, excluding items, were $5.87, exceeding the analysts' average estimate of $5.80 [5] Membership and Pricing Strategy - The company is reinvesting part of the increased membership fees into sharper pricing for members, benefiting both members and shareholders [4] - Earnings from membership fees rose by 14% to $1.72 billion for the quarter ended August 31 [4]

Core Insights - Costco Wholesale Corporation is set to release its fourth-quarter fiscal 2025 earnings results on September 25, prompting investors to consider whether to buy or hold the stock [1] - The company has demonstrated resilience through strategic investments, a customer-centric approach, and a focus on membership growth, leading to solid sales and earnings growth [2] Earnings Expectations - Analysts project fourth-quarter revenues of $86.23 billion, an 8.2% increase from the previous year, with earnings estimated at $5.82 per share, reflecting a 13% year-over-year increase [3] - Costco has a trailing four-quarter earnings surprise of 0.4%, with a recent quarter beating the Zacks Consensus Estimate by 0.7% [4] Sales Performance - In the fourth quarter, Costco reported net sales of $84.4 billion, an 8% increase from $78.2 billion last year, driven by strong comparable sales growth across regions and e-commerce [9] - Comparable sales rose 5.7%, with a 5.1% gain in the U.S., a 6.3% increase in Canada, and an 8.6% rise in other international markets [9] Membership and Customer Loyalty - Membership renewal rates exceed 90%, indicating strong customer loyalty and providing a reliable revenue stream, with membership fees expected to increase by 10.5% during the quarter [10] - Costco's business model emphasizes value-oriented offerings, which positions the company well for continued success in the retail landscape [11] Valuation Metrics - Costco's forward 12-month price-to-earnings (P/E) ratio is 47.13, higher than the industry average of 30.13 and the S&P 500's 23.52, indicating a premium valuation relative to peers [14][16] - Despite trading below its historical peak P/E level of 50.61, the stock remains at a premium compared to competitors like Target, Ross Stores, and Dollar General [16] Stock Performance - Over the past year, Costco shares have increased by 4.6%, outperforming the industry average of 3.9% and competitors such as Ross Stores and Target [13] - The cautious approach is suggested for new investors, as the Zacks model does not predict a definitive earnings beat, making it prudent to hold existing positions until after the earnings release [17]

Core Viewpoint - Costco Wholesale Corporation is preparing to release its third-quarter fiscal 2025 earnings results, with investors weighing the decision to buy or hold the stock based on earnings expectations and market conditions [1] Financial Performance Expectations - Analysts project third-quarter revenues to reach $63.1 billion, reflecting a 7.9% increase year-over-year, while earnings per share are estimated at $4.25, indicating a 12.4% year-over-year growth [3] - The company has a trailing four-quarter earnings surprise average of 0.8%, although it missed the Zacks Consensus Estimate by 1.7% in the last quarter [4] Growth Strategies and Market Position - Costco's strategic investments, customer-centric approach, and focus on membership growth have contributed to its resilience as a consumer defensive stock [2] - The company’s competitive pricing and bulk purchasing power enable it to maintain low prices, which is expected to drive comparable sales growth of 4.7% in the third quarter [8] - High membership renewal rates, exceeding 90%, provide a stable revenue source, with membership fees anticipated to increase by 9.6% during the quarter [9] E-commerce and Expansion - Costco's adaptability in product offerings and continuous expansion into new markets, including e-commerce growth projected at 21%, positions it well for future success [10] Valuation and Market Comparison - Costco's forward 12-month price-to-earnings (P/E) ratio is 52.28, significantly higher than the industry average of 33.09 and the S&P 500's 21.36, indicating a premium valuation [13] - The stock has outperformed competitors, with a 24% increase in price over the past year, compared to declines in competitors like Dollar General and Target [12] Investment Considerations - Despite its premium valuation, Costco's strong financial health and strategic initiatives suggest potential for further upside, making it a compelling choice for growth-oriented investors [18]

Core Insights - The article discusses Costco's strategy to expand into third and fourth-tier cities in response to market saturation in first-tier cities, focusing on the potential impact on consumer behavior and local retail dynamics [1] Group 1: Adaptability of Costco's Membership Model - Costco's membership model has seen global success, and its applicability in lower-tier cities is under scrutiny. The price sensitivity of consumers in these areas may favor Costco's bulk purchasing and low-margin strategy, attracting a loyal customer base [3] - Consumer acceptance of membership fees in third and fourth-tier cities may be low, necessitating effective market education and promotion strategies [3] Group 2: Product Structure and Consumer Demand - Costco's product offerings, characterized by high quality and large packaging, align with the rising quality expectations of consumers in lower-tier cities. The family-oriented structure in these areas may favor bulk purchases [4] - However, large packaging could lead to inventory challenges, requiring Costco to adjust its product structure to better fit local consumption habits [4] Group 3: Logistics and Supply Chain Challenges - The logistics infrastructure in third and fourth-tier cities is relatively weak, posing a significant challenge for Costco. Substantial investment in logistics network development is essential for success [5] - Establishing strong partnerships with local suppliers is crucial for ensuring supply chain stability, which directly affects product availability and pricing [5] Group 4: Brand Influence and Consumer Recognition - Costco's brand recognition is higher in first-tier cities, but it may be lower in smaller cities. Enhancing brand awareness through advertising and word-of-mouth marketing is necessary [6] - Building consumer trust through quality service and products is vital, as local consumers tend to exhibit high brand loyalty [6] Group 5: Competitive Environment Analysis - The retail market in third and fourth-tier cities is competitive, with local supermarkets and convenience stores dominating. Costco must differentiate itself to attract consumers [7] - The increasing penetration of e-commerce in these areas requires Costco to compete effectively with online platforms, potentially exploring an integrated online-offline model [7] Group 6: Potential Impact on Local Consumption - Costco's entry into lower-tier cities is expected to elevate local consumption levels and upgrade the retail market. The introduction of high-quality products and services will enhance consumer shopping experiences [8] - The membership model may inspire local retailers to innovate, fostering overall industry development, although it could also disrupt small local businesses [8] Group 7: Future Development Trends - The ongoing economic growth in third and fourth-tier cities presents significant market potential for Costco. Continuous optimization of product offerings and service models will enhance competitiveness [9] - Collaborating with local businesses to develop market-specific products and services could further accelerate Costco's growth in these regions [9] Group 8: Successful Case Studies and Lessons Learned - Global success stories of Costco, particularly in North America and Asia, provide valuable insights for its expansion into lower-tier cities. These experiences highlight the resilience of the membership model and effective logistics management [10] - Learning from these successful cases will enable Costco to better navigate the challenges of entering third and fourth-tier markets [10] Group 9: Social and Economic Benefits - Costco's expansion into lower-tier cities is anticipated to create numerous job opportunities and stimulate local economic growth. The introduction of high-quality products will improve consumer living standards [11] - The membership model may also drive innovation among local retailers, contributing to the overall development of the retail sector [11]

Core Viewpoint - Costco's stock has experienced a significant decline after reaching a 52-week high, primarily due to disappointing fiscal Q2 earnings and high valuation expectations, raising questions about whether it presents a buying opportunity at a discount [1][2]. Financial Performance - Costco's net sales for fiscal Q2 2025 increased by 9.1% year over year to $62.53 billion, with comparable sales rising by 6.8% [2]. - Paid household memberships grew to 78.4 million, a 6.8% increase from the previous year, while executive memberships rose by 9.1% to 36.9 million [3]. - Earnings per share (EPS) reached $4.02, up from $3.92 a year ago, reflecting an 8.4% growth when excluding a prior year's tax benefit [5]. E-commerce and Growth - E-commerce comparable sales surged by 22.2% year over year, driven by strong demand in various categories, including home furnishings and small electrics [4]. - Membership renewal rates remain high, at 93% in the U.S. and Canada, and 90.5% globally, indicating strong customer loyalty [3]. Valuation Concerns - Costco's price-to-earnings ratio stands at 54, suggesting that investors expect high single-digit sales growth and double-digit EPS growth for the foreseeable future, which may be overly optimistic [6]. - Despite the recent stock price decline, Costco still trades at a significant premium, leaving little room for error in future performance [8][9]. Long-term Outlook - The long-term outlook for Costco remains strong, with continued growth in sales, earnings, and memberships, alongside effective cost management and e-commerce expansion [8]. - However, the current stock valuation may lead to modest returns if growth only meets expectations, prompting investors to consider waiting for a more favorable entry point [9].

Core Insights - Costco Wholesale Corporation reported second-quarter fiscal 2025 results with total revenues exceeding estimates while adjusted earnings fell short, both metrics showing year-over-year growth [1][2][3] Financial Performance - Adjusted earnings per share were $4.02, missing the Zacks Consensus Estimate of $4.09, but up 8.4% from $3.71 in the prior year [2] - Total revenues reached $63,723 million, a 9% increase from the previous year, surpassing the Zacks Consensus Estimate of $63,224 million [3] - Comparable sales rose 6.8% year over year, exceeding the estimated 4.3%, with U.S. comparable sales growing 8.3% [3][6] Membership and Sales Growth - Membership fees increased 7.4% to $1,193 million, with paid household members rising 6.8% to 78.4 million [5] - Total cardholders grew 6.6% to 140.6 million, indicating strong customer loyalty with a membership renewal rate of 90.5% [4][5] Operational Metrics - Global shopping frequency improved by 5.7%, while average transaction size grew by 1% [6] - E-commerce sales saw a significant increase of 20.9% year over year, or 22.2% when excluding gasoline prices and currency fluctuations [7] Margin and Income - Gross margin expanded by 5 basis points to 10.9%, with operating income growing 12.3% to $2,316 million [7] - Operating margin improved by 10 basis points to 3.6%, although it fell short of the anticipated 20 basis-point expansion [7] Expansion Plans - Costco operates 897 warehouses globally, with plans to open 28 new locations in fiscal 2025 [8] Financial Health - The company ended the quarter with cash and cash equivalents of $12,356 million and long-term debt of $5,755 million [10] - Capital expenditures for the quarter were approximately $1.14 billion, with a forecast of about $5 billion for fiscal 2025 [10]