Abstract
Costco Wholesale will announce fiscal Q1 2026 results on December 11, 2025 Post Market; consensus points to solid revenue growth and sustained membership strength while analysts expect resilient margins and cautious commentary on non-food comparisons.
Market Forecast
For the current quarter, forecasts indicate total revenue of USD 66,955,886,300.00, year-over-year growth of 7.85%, EBIT at USD 2,435,558,910.00 with forecast year-over-year growth of 14.26%, and EPS of USD 4.27 with forecast year-over-year growth of 12.72%. Forecast highlights indicate steady traffic and ticket, with membership resilience supporting margin visibility; gross profit margin and net profit margin are not formally guided for the quarter. The main business is expected to perform consistently on core retail sales and membership fees, with membership fee revenue continuing to be a key bottom-line driver; the most promising segment remains membership income, supported by renewal rates and ongoing price increase carry-through.
Last Quarter Review
Last quarter, Costco reported revenue of USD 86,156,000,000.00, a gross profit margin of 12.91%, GAAP net profit attributable to the parent company of USD 2.61 hundred million, a net profit margin of 3.03%, and adjusted EPS of USD 5.87 with year-over-year growth of 10.96%. A key highlight was healthy operating performance with EBIT of USD 3,341,000,000.00, closely matching estimates while EPS edged past consensus. Main business highlights: core sales (“net sales”) were USD 84,432,000,000.00 and membership fees were USD 1,724,000,000.00; year-over-year growth was positive across both categories, with comparable sales strength and membership expansion underpinning results.
Current Quarter Outlook
Core Warehouse Sales
Core warehouse sales remain the principal revenue engine this quarter. Monthly and quarterly trends suggest continued gains in traffic and ticket, supported by stable food categories and selective strength in discretionary items where value perception is high. Seasonal mix typically increases non-food volatility; analysts have cautioned about difficult comparisons in certain non-food categories, which may temper gross margin expansion even if sales growth is healthy. Given Costco’s practice of maintaining price discipline to protect value perception, gross margin may reflect limited upside in the quarter, while operating efficiency and membership carry may support overall profitability.
Membership Fees
Membership revenue continues to provide the largest sustained growth potential for profitability due to its high margin and durability. The prior membership fee increase is still flowing through the base and, together with high renewal rates, it supports predictable EPS leverage. Executive membership initiatives, including operational changes to reduce warehouse congestion and enhance member experience, are likely to strengthen engagement, even if near-term implementation costs slightly weigh on SG&A. In aggregate, membership fees offer a defensive earnings buffer and underpin forecast EPS growth of 12.72% this quarter.
Key Stock Price Drivers
Three factors appear most impactful for Costco’s shares around this print. First, comparative performance in non-food categories will shape gross margin commentary; investors are attentive to any signals of margin pressure from restrained pricing or mix shifts. Second, traffic and ticket trends versus consensus will inform revenue quality, particularly in the U.S. and e-commerce, where momentum has been notable. Third, membership metrics remain central to valuation debates; sustained renewal strength and fee uplift are likely to validate the EPS trajectory, while any unexpected operational expense tied to executive access initiatives could influence near-term sentiment.
Analyst Opinions
Analyst and institutional previews skew bullish by a clear margin. Over the last six months, multiple buy-rated views were reiterated: J.P. Morgan (Christopher Horvers) maintained Buy citing strong performance and growth potential; Morgan Stanley (Simeon Gutman) held Buy with a USD 1,130.00 target, emphasizing strategic advantages; Bank of America (Robert Ohmes) reaffirmed Buy on financial strength and initiatives; William Blair (Phillip Blee) kept Buy, underscoring resilience and expansions; Jefferies (Corey Tarlowe) reiterated Buy with a USD 1,180.00 target; and TD Cowen (Oliver Chen) highlighted strategic growth and digital enhancements supporting a constructive stance. Hold/Neutral commentary from Wells Fargo, D.A. Davidson, Mizuho, Truist, and Roth Capital mainly centers on valuation concerns and potential near-term comparison challenges, but remains outnumbered by buy-rated calls. Barron’s summarized a split view on near-term EPS risk in non-food comparisons, with Oppenheimer noting limited near-term upside and Evercore ISI constructive on maintaining a premium valuation given strong same-store sales and membership tailwinds. Overall, the majority view expects solid revenue growth, resilient membership-driven profitability, and valuation support if earnings and membership metrics align with forecasts.Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
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