Costco Wholesale Stock Earnings Reports

Costco delivered a strong Q1 FY2026 with net sales of $65.98B (up 8.2% YoY) and net income of $2.001B ($4.50 diluted EPS). Comparable sales grew 6.4% (7.1% ex-gas & FX) with digitally-enabled comps up 20.5%. Membership income rose 14% to $1.329B; total paid members reached 81.4M (up 5.2%) and paid Executive members were 39.7M (up 9.1%). Costco opened eight warehouses in Q1 (total 921 worldwide) and continues to target a long-term runway of 30+ net new warehouses annually, while planning ~28 net openings in FY2026 due to some Spain delays. Capital expenditures were ~$1.53B in Q1 and are expected to be ~ $6.5B for the year to support expansion, remodels, depot and digital investments. Gross margin was essentially flat year-over-year with a 30 bps improvement in core-on-core margins driven by supply chain gains and increased Kirkland Signature penetration; reported SG&A was flat to slightly higher due to healthcare costs and a tax assessment charge. Costco highlighted meaningful digital progress — membership scanning at entry, digital wallet, prescan tech (up to 20% faster checkout in early adopters), personalization (positive sales lift), and AI use cases (pharmacy inventory optimization raising in-stocks to >98% and deployment planned for gas). Key merchandise trends: fresh and food mid–high single-digit growth (meat particularly strong), nonfoods mid-single-digit comps with strength in categories like jewelry, majors, tires, and small appliances; Kirkland Signature continues to outpace overall growth. Management reiterated focus on member value (first to lower prices) and sees continued market-share opportunities, a balanced mix of infill and new-market openings, and a continued runway for digital and AI investments aimed at improving member experience and operational efficiency. Risks called out include the usual forward-looking uncertainties (tariffs, FX, supply chain events) and potential near-term pressure on renewal rates as digitally acquired members renew at slightly lower rates — management is taking targeted communications actions to improve renewals.