Financial Data and Key Metrics Changes - Net income for Q2 2026 was $2.035 billion or $4.58 per diluted share, up nearly 14% from $1.788 billion or $4.02 per diluted share in Q2 2025 [12] - Net sales for Q2 were $68.24 billion, an increase of 9.1% from $62.53 billion in Q2 2025 [12] - Membership fee income was $1.355 billion, an increase of $162 million or 13.6% year-over-year [14] - Gross margin rate was 11.02%, up 17 basis points year-over-year [16] Business Line Data and Key Metrics Changes - Comparable sales were up 7.4%, with digital sales up 22.6% [13] - Fresh comparable sales were up low double digits, led by meat and bakery [20] - Non-food comparable sales were up high single digits, with top-performing departments including gold and jewelry, tires, and health and beauty [21] - Pharmacy and food court experienced double-digit comparable sales growth [24] Market Data and Key Metrics Changes - U.S. comparable sales were up 5.2% or 6% adjusted for gas deflation and FX [26] - Canada comparable sales were up 12.8% or 9.3% adjusted for gas deflation and FX [26] - Other international markets saw a 17.9% increase or 10.9% adjusted for gas deflation and FX [26] - Traffic increased 3.1% worldwide, with average transaction value up 4.2% [13] Company Strategy and Development Direction - The company is focused on increasing its pipeline of new warehouses, with 28 net new openings expected in fiscal year 2026 [9] - Digital enhancements are being implemented to improve member experience and operational efficiency [10] - The company aims to be the first to lower prices and the last to raise them, with recent price reductions on key items [8] - Kirkland Signature products remain a priority, offering significant value compared to national brands [23] Management's Comments on Operating Environment and Future Outlook - Management noted that the impact of tariffs remains fluid, but they are actively managing costs to minimize price impacts on members [5][6] - The company is optimistic about its growth trajectory, citing strong member loyalty and ongoing digital enhancements [41] - Management acknowledged potential challenges from geopolitical events affecting fuel costs and shipping schedules [22] Other Important Information - Capital expenditure in Q2 was $1.29 billion, with an estimated full-year CapEx of approximately $6.5 billion [19] - The company is seeing a slight decline in U.S. and Canada renewal rates, attributed to the growing percentage of new online members [15] Q&A Session Summary Question: Impact of weather on sales in January and February - Management acknowledged some volatility due to weather but did not see a major impact on total sales results [32][33] Question: Innovations to improve member experience and efficiency - Management highlighted the benefits of digital enhancements in improving member experience and handling increased volume [40] Question: Changes to product assortment for spring and summer - Management indicated a return to more traditional assortment strategies as supply chains stabilize [49] Question: Competitive openings and membership impact - Management stated that new competitor openings do not negatively affect membership growth [56][60] Question: Renewal rates and auto-renewal program - Management noted a slight decline in renewal rates but is optimistic about initiatives to improve them, including the auto-renewal program [96]

Group 1 - Dongguan Hechangheng Technology Co., Ltd. has been established with a registered capital of 100,000 RMB [1] - The company's business scope includes technology services, development, consulting, exchange, transfer, and promotion [1] - The company also engages in the sale of various products including packaging materials, paper products, plastic products, leather products, textiles, and hardware [1] Group 2 - The company is authorized to conduct business activities independently based on its business license, except for projects that require approval [1]

Core Viewpoint - Recently, Texas Boson Packaging Co., Ltd. was established with a registered capital of 200,000 RMB, indicating a new player in the packaging industry [1] Company Summary - The legal representative of Texas Boson Packaging Co., Ltd. is Wang Ping [1] - The company has a registered capital of 200,000 RMB [1] - The business scope includes sales of packaging materials and products, clothing accessories, industrial textile products, paper products, specialized packaging equipment, metal packaging containers and materials, textile products and raw materials, metal materials, rubber products, packaging services, daily necessities, daily glass products, specialized chemical products (excluding hazardous chemicals), plastic products, advertising publication, advertising design and agency, wooden container sales, and office supplies [1]

Core Viewpoint - A new company, Dongshuo Trading Co., Ltd., has been established in Tianchang City, with a registered capital of 100,000 RMB, focusing on various office and printing supplies sales and services [1] Company Overview - The legal representative of Dongshuo Trading Co., Ltd. is Cai Youpeng [1] - The registered capital of the company is 100,000 RMB [1] Business Scope - The company engages in the sale of office supplies, stationery, paper products, office equipment, and computer hardware and software [1] - It also offers wholesale and retail services for 3D printing materials, ink (excluding hazardous chemicals), calculators, and office equipment consumables [1] - Additional services include computer and office equipment maintenance, professional design services, and typing and copying services [1]

Group 1 - The establishment of Suqian Yishuo Packaging Co., Ltd. has been registered with a legal representative named Chen Haowei and a registered capital of 500,000 RMB [1] - The company's business scope includes licensed projects such as printing of packaging and decorative printing products, as well as other printing services that require approval from relevant authorities [1] - General business activities include sales of packaging materials and products, wooden containers, plastic products, paper products, rubber products, and various retail and trade services [1]

Core Viewpoint - A new company, Chaozhou Chaoan District Jun Tian Printing Co., Ltd., has been established with a registered capital of 1 million RMB, focusing on various printing and manufacturing activities related to packaging and medical supplies [1] Company Summary - The company is registered with a capital of 1 million RMB [1] - It operates in the printing of packaging and decorative printing products, production of food paper packaging and container products, as well as sanitary and disposable medical supplies [1] - The company is authorized to engage in various general projects including the manufacturing and sales of plastic products, new film materials, paper products, and first-class medical devices [1] Industry Summary - The company is part of the broader packaging and printing industry, which includes sectors such as food packaging, medical supplies, and plastic manufacturing [1] - The operational scope includes both licensed and general projects, indicating a diverse range of activities within the industry [1]

Core Viewpoint - A new individual business named Lai Ze Trading has been established in Qiaoxi District, Zhangjiakou City, with a registered capital of 10,000 RMB, focusing on various retail and sales activities [1] Company Summary - The legal representative of Lai Ze Trading is Wang Chen [1] - The business scope includes general projects such as daily necessities sales, daily goods sales, cosmetics retail, stationery retail, office supplies sales, paper products sales, and internet sales (excluding items requiring permits) [1] - Additional activities include the sale of arts and crafts and ceremonial supplies (excluding ivory and its products) and packaging services [1]

Group 1 - A new company, Kunshan Jusheng Wood Products Co., Ltd., has been established with a registered capital of 200,000 RMB [1] - The legal representative of the company is Jiao Huaqin [1] - The business scope includes sales of wooden containers, daily wooden products, paper products, packaging materials, plastic products, daily necessities, metal packaging containers and materials, food-grade plastic packaging tools, bags, cork products, rubber products, labor services (excluding labor dispatch), furniture sales, and internet sales (excluding items requiring permits) [1]

Core Viewpoint - Yantai Juwei New Materials Technology Co., Ltd. has been established with a registered capital of 1 million RMB, focusing on various new material technologies and products [1] Group 1: Company Overview - The legal representative of Yantai Juwei New Materials Technology Co., Ltd. is Li Aiguo [1] - The company has a registered capital of 1 million RMB [1] Group 2: Business Scope - The business scope includes general projects such as new material technology promotion services, research and development, and various technical services [1] - The company is involved in the manufacturing and sales of new membrane materials, plastic products, paper products, synthetic materials, and chemical products (excluding licensed chemical products) [1] - Additional activities include the production and sales of fireproof sealing materials, automotive parts and accessories, ecological environment materials, bio-based materials, and various construction and packaging materials [1]

Core Insights - A new individual business named Chengdu Qingbai River Carbon Guide Trading Department has been established in Chengdu, with a registered capital of 10,000 RMB [1] Business Overview - The legal representative of the business is Huang Yu [1] - The business scope includes sales of specialized chemical products (excluding hazardous chemicals), new organic active materials, and various carbon-related technologies such as carbon reduction, conversion, capture, and storage [1] - Additional services offered include handling and transportation, packaging services for goods, general warehousing (excluding hazardous materials), and sales of plastic, paper, bamboo products, daily necessities, and pre-packaged food [1] - The business also engages in internet sales (excluding licensed goods), personal internet live streaming services, and daily life services for residents [1]