Costco Wholesale Corporation (NASDAQ: COST) reported operating results for its 16-week fourth quarter and 52-week fiscal year ended August 30, 2026, delivering top- and bottom-line growth that topped Wall Street projections. The Issaquah, Washington-based wholesale club announced its financial performance after the market close on Thursday, September 24, 2026, highlighted by resilient warehouse foot traffic, accelerating e-commerce momentum, and steady renewal rates among its 150 million cardholders.
Here are the key takeaways from the earnings release:
- Top-Line Expansion: Net sales rose 11.2% year-over-year to $93.87 billion in the fourth quarter, bringing full-year fiscal 2026 net sales to $297.25 billion.
- Membership Stickiness: Renewal rates held firm at 92.3% in the United States and Canada (89.8% worldwide), generating $1.85 billion in quarterly fee revenue.
- Digital Acceleration: Digitally-enabled comparable sales surged 19.5% during the quarter, aided by third-party same-day delivery expansions and 30% higher app traffic.
Q4 Financial Performance and Earnings Breakdown
According to the company’s Form 8-K earnings press release (Exhibit 99.1), Costco Wholesale reported net sales of $93.87 billion ($93,873 million) for the 16-week fourth quarter ended August 30, 2026, an 11.2% increase from $84.43 billion ($84,432 million) in the prior-year period. In the filing, Costco confirmed that “Net sales for the quarter increased 11.2 percent, to $93.9 billion, from $84.4 billion last year.”
Total revenue for the fourth quarter reached $95.72 billion ($95,723 million), driven by $1.85 billion ($1,850 million) in membership fees, up 7.3% year-over-year. Operating income expanded 13.8% to $3.801 billion, up from $3.341 billion in the fourth quarter of fiscal 2025.
Profitability saw significant gains on both an operating and per-share basis. Net income for the fourth quarter rose 14.9% to $2.998 billion, or $6.75 per diluted share, compared to $2.610 billion, or $5.87 per diluted share, in the fourth quarter of fiscal 2025. Primary disclosures confirmed: “Net income for the fourth quarter was $2.998 billion, $6.75 per diluted share, compared to $2.610 billion, $5.87 per diluted share, last year.”
A notable non-operational factor bolstered the quarterly result: Fourth-quarter diluted earnings per share included a non-recurring benefit of $0.15 from IEEPA tariff refunds received during the quarter, less partial reinvestment in increased member values. Excluding this one-off tariff refund item, Costco’s net income grew 12.3% and diluted earnings per share grew 12.4% year-over-year.
For the 52-week fiscal year 2026, total net sales grew 10.1% to $297.25 billion ($297,247 million) and net income increased 13.9% to $9.226 billion, or $20.76 per diluted share. This compares to $8.099 billion, or $18.21 per diluted share, earned throughout fiscal 2025.
Comparable Sales and Digital Momentum
Costco’s underlying warehouse traffic and basket size demonstrated healthy consumer spending across all geographies, contrasting with selective belt-tightening seen across other segments of retail noted in recent retail earnings analyses. As detailed in Costco’s Supplemental Information filing (Exhibit 99.2), total company comparable sales for the fourth quarter rose 9.4% on a reported basis and 6.7% after excluding the impacts of gasoline price changes and foreign exchange fluctuations.
In the United States, comparable sales grew 10.7% reported (7.2% adjusted), supported by a 3.2% increase in foot traffic and a 3.9% increase in adjusted average transaction ticket. Canadian operations delivered 5.0% reported comps (4.6% adjusted), while Other International segments posted 7.0% reported comps (6.2% adjusted).
E-commerce operations also posted rapid growth. Digitally-enabled comparable sales surged 19.5% reported and 19.8% adjusted for currency movements in the fourth quarter, supported by a 30% increase in e-commerce site and app traffic. Growth was led by double-digit demand in pharmacy, home furnishings, small electrics, hardware, housewares, and domestics. Unlike apparel retailers managing order workflow friction such as that observed in the Stitch Fix Q4 checkout bottleneck, Costco expanded third-party same-day delivery channels and implemented personalized email and online merchandising enhancements.
| Metric (dollars in millions, except EPS) | Q4 FY2026 (16 Wks) | Q4 FY2025 (16 Wks) | Year-over-Year Change |
|---|---|---|---|
| Net Sales | $93,873 | $84,432 | +11.2% |
| Membership Fee Revenue | $1,850 | $1,724 | +7.3% |
| Total Revenue | $95,723 | $86,156 | +11.1% |
| Operating Income | $3,801 | $3,341 | +13.8% |
| Net Income | $2,998 | $2,610 | +14.9% |
| Diluted Earnings Per Share | $6.75 | $5.87 | +15.0% |
| Adjusted Comparable Sales (ex-Gas/FX) | +6.7% | +5.8% | +90 bps |
| Cash and Cash Equivalents | $20,207 | $14,161 | +$6,046 |
Membership Economics, Fleet Expansion, and Balance Sheet
Membership loyalty serves as Costco’s primary economic engine, providing high-margin recurring cash flow. The supplemental disclosure confirmed that Costco maintained a worldwide membership renewal rate of 89.8% and a US and Canada renewal rate of 92.3%, with executive members accounting for 42.3 million cardholders and 75.6% of sales. Total cardholders expanded 3.6% year-over-year to 150.4 million across 84.1 million paid memberships, matching the company’s verified disclosure: “89.8% Worldwide Membership Renewal Rate 150.4MM Total Cardholders +3.6% Growth 42.3MM Executive Memberships.”
Gross margin for the quarter contracted by 11 basis points to 11.02% on a reported basis, but increased by 20 basis points when excluding the dilutive impact of lower gasoline prices. Selling, general, and administrative (SG&A) expenses improved by 27 basis points reported to 8.94% of sales (+2 basis points excluding gasoline), reflecting disciplined overhead leverage across warehouses.
Costco continues to expand its physical footprint alongside digital channels. Costco ended fiscal 2026 with 939 operating warehouses worldwide and $20.21 billion ($20,207 million) in cash and cash equivalents. The fleet includes 647 warehouses across the United States and Puerto Rico, 115 in Canada, 43 in Mexico, 37 in Japan, 29 in the United Kingdom, 20 in Korea, 15 in Australia, 14 in Taiwan, 7 in China, 5 in Spain, 3 in France, 2 in Sweden, and 1 location each in Iceland and New Zealand. Management outlined plans to open 28 net new units in fiscal 2027, projecting an ending footprint of 967 locations.
On the balance sheet, Costco ended fiscal 2026 with $6.16 billion in total debt ($2.25 billion in current portion of long-term debt and $3.91 billion in long-term debt excluding current portion), well exceeded by its $20.21 billion in cash and cash equivalents and $1.09 billion in short-term investments. For broader context on how capital structure and liquidity affect equity performance, explore our market learning guide.
Sources
- Costco Wholesale Corporation Form 8-K (Exhibit 99.1 Press Release), filed with the SEC on September 24, 2026.
- Costco Wholesale Corporation Form 8-K (Exhibit 99.2 Supplemental Information), filed with the SEC on September 24, 2026.
Disclosure: This article is for informational purposes only and is not investment advice.