Costco Wholesale (COST) Q1 2025 earnings summary

Executive summary

• Net sales for Q1 FY25 rose 7.5% year-over-year to $60.99 billion, with comparable sales up 5.2% and e-commerce comp sales up 13%.

• Net income reached $1.798 billion ($4.04 per diluted share), up from $1.589 billion ($3.58 per share) last year, including a $100 million tax benefit from stock-based compensation.

• Membership fee income grew 7.8% to $1.166 billion, with paid household members up 7.6% to 77.4 million and Executive Members up 9.2%.

• Opened 6–7 new warehouses in Q1, with plans for 29 openings in FY25 (10 international); total warehouses reached 897.

• Strong performance in bakery, food court, pharmacy (prescription growth >19%), and logistics, with nearly 1 million deliveries in Q1.

Financial highlights

• Gross margin improved 24 bps to 11.28%, with core margin up 31 bps; SG&A rate was 9.59% of sales, up 14 bps year-over-year.

• Excluding discrete tax items, net income and EPS grew 9.9% and 9.8% year-over-year.

• Operating income increased to $2.196 billion from $1.984 billion year-over-year.

• Interest expense was $37 million; interest income $96 million, down due to lower cash balances and rates.

• Cash and cash equivalents at quarter-end were $10.91 billion, up from $9.91 billion at the start of the quarter.

Outlook and guidance

• CapEx for Q1 was $1.26 billion; full-year estimate is ~$5 billion, focused on new warehouses, supply chain, and technology.

• Expect to open 29 warehouses in FY25 (26 net new), with about 10 international.

• Monitoring supply chain risks (port strikes in India, East Coast, Canada) and adapting inventory plans.

• Retail media is in early stages but seen as a significant future growth opportunity.

• Management expects cash and investment position and operating cash flow to be sufficient for foreseeable liquidity and capital needs.