Costco Wholesale (COST) Q1 2026 earnings summary

Executive summary

• Net sales rose 8.2% year-over-year to $65.98 billion in Q1 FY26, driven by comparable sales growth and new warehouse openings, with the global warehouse count reaching 923.

• Membership base grew to 81.4 million paid members (+5.2% YoY), with membership fee income up 14% to $1.329 billion and renewal rates at 92.2% in the U.S./Canada and 89.7% worldwide.

• Digitally enabled comparable sales surged 20.5% YoY, with top categories including pharmacy, jewelry, tires, small electrics, and apparel.

• Eight new warehouses opened in Q1, with plans for 20–28 net new openings in FY26 due to Spain delays, and a long-term goal of 30+ annual openings.

• Strong focus on digital transformation, AI integration, and enhanced member experience, including new value initiatives and improved site features.

Financial highlights

• Net income for Q1 was $2.001 billion ($4.50 per diluted share), up from $1.798 billion ($4.04 per share) YoY; adjusted net income and EPS grew 13.6% excluding discrete tax items.

• Net sales reached $65.98 billion, up 8.2% YoY; total revenue including membership fees was $67.31 billion.

• Gross margin improved by 4 bps to 11.32%; core-on-core margins up 30 bps.

• SG&A rate was 9.6%, up 1 bp YoY, impacted by higher healthcare costs and a tax assessment charge.

• Cash and cash equivalents at quarter-end were $16.22 billion, up from $10.91 billion a year ago.

Outlook and guidance

• FY26 net new warehouse openings revised to 20–28 due to Spain delays; long-term plan remains 30+ annual openings.

• Capital expenditures for fiscal 2026 expected at $6.5 billion, focused on new warehouses, remodels, depot expansion, and digital investments.

• Management expects cash flow and liquidity to be sufficient for foreseeable needs.

• Expect digital sales and engagement to outpace overall sales growth.

• Forward-looking statements highlight risks from economic conditions, competition, regulation, and other uncertainties.