Costco Wholesale Corporation Reports Third Quarter and Year-To-Date Operating Results for Fiscal 2025

Rhea-AI Summary

Costco Wholesale reported strong Q3 fiscal 2025 results with net sales increasing 8.0% to $61.96 billion. The company's net income rose to $1.90 billion ($4.28 per diluted share), up from $1.68 billion ($3.78 per diluted share) year-over-year. Total company comparable sales grew 5.7% (8.0% adjusted), while e-commerce sales surged 14.8%. Membership fees revenue increased to $1.24 billion from $1.123 billion. For the first 36 weeks, net sales grew 8.2% to $185.48 billion, with net income reaching $5.49 billion ($12.34 per diluted share). Costco continues its global expansion, now operating 905 warehouses worldwide, with strong presence across 13 countries and e-commerce operations in 8 markets.

Positive

• Net sales increased 8.0% to $61.96 billion in Q3
• Net income grew 13.2% to $1.90 billion
• E-commerce sales showed strong growth of 14.8%
• Membership fee revenue increased 10.4% to $1.24 billion
• Global expansion continues with 905 warehouses across 13 countries

Negative

• Slight decline in merchandise inventories from $18,647M to $18,606M
• Operating lease liabilities increased to $2,463M from $2,375M

Insights

Financial Analyst

Costco reports robust Q3 2025 results with 8.0% sales growth, 13.2% EPS growth, and strong e-commerce performance.

Costco has delivered another impressive quarter with net sales increasing 8.0% to $61.96 billion in Q3 fiscal 2025. This represents solid execution in a competitive retail environment. Their adjusted comparable sales grew 8.0% company-wide when excluding impacts from gasoline prices and foreign exchange.

What's particularly noteworthy is their e-commerce growth of 15.7% on an adjusted basis, showing Costco's successful digital transformation while maintaining their warehouse-based business model. This digital channel expansion continues to complement their brick-and-mortar operations effectively.

Profitability metrics show substantial improvements. Net income reached $1.90 billion, translating to diluted EPS of $4.28 - a 13.2% year-over-year increase from $3.78. This earnings growth outpacing revenue growth demonstrates effective cost management and operating leverage.

Membership fee income increased 10.4% to $1.24 billion, highlighting the strength of Costco's membership model. The growth in this high-margin revenue stream is particularly important as these fees flow directly to the bottom line. Deferred membership fees on the balance sheet grew to $2.93 billion from $2.50 billion in September 2024, indicating strong member retention and new sign-ups.

The balance sheet remains exceptionally strong with $13.84 billion in cash and cash equivalents, up significantly from $9.91 billion in September 2024. This financial flexibility provides ample resources for continued warehouse expansion, with the company now operating 905 locations globally.

Looking at operating metrics, the company maintained gross margins despite inflationary pressures, with merchandise costs as a percentage of net sales at 88.8% compared to 89.2% in the same period last year. SG&A expenses rose slightly as a percentage of revenue, but the overall operating income margin still improved to 4.0% from 3.8% last year.

The 8.2% year-to-date sales increase and 9.5% EPS growth reflect Costco's consistent execution of its business model that continues to resonate with consumers globally, even in varying economic conditions across its markets.

ISSAQUAH, Wash., May 29, 2025 (GLOBE NEWSWIRE) -- Costco Wholesale Corporation (“Costco” or the “Company”) (Nasdaq: COST) today announced its operating results for the third quarter (twelve weeks) and the first 36 weeks of fiscal 2025, ended May 11, 2025.

Net sales for the quarter increased 8.0 percent, to $61.96 billion, from $57.39 billion last year. Net sales for the first 36 weeks increased 8.2 percent, to $185.48 billion, from $171.44 billion last year.

Comparable sales for the third quarter and first 36 weeks of fiscal 2025 were as follows:

	12 Weeks		12 Weeks		36 Weeks		36 Weeks
			Adjusted*				Adjusted*
U.S.	6.6%		7.9%		6.7%		7.9%
Canada	2.9%		7.8%		4.4%		8.3%
Other International	3.2%		8.5%		3.2%		8.7%
Total Company	5.7%		8.0%		5.9%		8.1%
E-commerce	14.8%		15.7%		16.4%		17.2%

*Excluding the impacts from changes in gasoline prices and foreign exchange.

Net income for the quarter was $1.90 billion, $4.28 per diluted share, compared to $1.68 billion, $3.78 per diluted share, last year. Net income for the first 36 weeks was $5.49 billion, $12.34 per diluted share, compared to $5.01 billion, $11.27 per diluted share, last year.

Costco currently operates 905 warehouses, including 624 in the United States and Puerto Rico, 109 in Canada, 41 in Mexico, 37 in Japan, 29 in the United Kingdom, 19 in Korea, 15 in Australia, 14 in Taiwan, seven in China, five in Spain, two in France, and one each in Iceland, New Zealand and Sweden. Costco also operates e-commerce sites in the U.S., Canada, the U.K., Mexico, Korea, Taiwan, Japan and Australia.

A conference call to discuss these results is scheduled for 2:00 p.m. (PT) today, May 29, 2025, and is available via a webcast on investor.costco.com (click on “Events & Presentations”).

Certain statements contained in this document constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For these purposes, forward-looking statements are statements that address activities, events, conditions or developments that the Company expects or anticipates may occur in the future. In some cases forward-looking statements can be identified because they contain words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “likely,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “target,” “will,” “would,” or similar expressions and the negatives of those terms. Such forward-looking statements involve risks and uncertainties that may cause actual events, results or performance to differ materially from those indicated by such statements. These risks and uncertainties include, but are not limited to, domestic and international economic conditions, including exchange rates, inflation or deflation, the effects of competition and regulation, uncertainties in the financial markets, consumer and small business spending patterns and debt levels, breaches of security or privacy of member or business information, conditions affecting the acquisition, development, ownership or use of real estate, capital spending, actions of vendors, rising costs associated with employees (generally including health-care costs and wages), workforce interruptions, energy and certain commodities, geopolitical conditions (including tariffs), the ability to maintain effective internal control over financial reporting, regulatory and other impacts related to environmental and social matters, public-health related factors, and other risks identified from time to time in the Company’s public statements and reports filed with the Securities and Exchange Commission. Forward-looking statements speak only as of the date they are made, and the Company does not undertake to update these statements, except as required by law. Comparable sales and comparable sales excluding impacts from changes in gasoline prices and foreign exchange are intended as supplemental information and are not a substitute for net sales presented in accordance with U.S. GAAP.

CONTACTS:	Costco Wholesale Corporation
	Josh Dahmen, 425/313-8254
	Andrew Yoon, 425/313-6305

COST-Earn

COSTCO WHOLESALE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(dollars in millions, except per share data) (unaudited)
	12 Weeks Ended								36 Weeks Ended
	May 11, 2025				May 12, 2024				May 11, 2025				May 12, 2024
REVENUE
Net sales	$	61,965			$	57,392			$	185,480			$	171,440
Membership fees		1,240				1,123				3,599				3,316
Total revenue		63,205				58,515				189,079				174,756
OPERATING EXPENSES
Merchandise costs		54,996				51,173				164,849				152,770
Selling, general and administrative		5,679				5,145				17,188				15,743
Operating income		2,530				2,197				7,042				6,243
OTHER INCOME (EXPENSE)
Interest expense		(35	)			(41	)			(108	)			(120	)
Interest income and other, net		85				128				374				504
INCOME BEFORE INCOME TAXES		2,580				2,284				7,308				6,627
Provision for income taxes		677				603				1,819				1,614
NET INCOME	$	1,903			$	1,681			$	5,489			$	5,013
NET INCOME PER COMMON SHARE:
Basic	$	4.29			$	3.79			$	12.36			$	11.29
Diluted	$	4.28			$	3.78			$	12.34			$	11.27
Shares used in calculation (000s):
Basic		443,958				443,892				443,976				443,870
Diluted		444,762				444,828				444,846				444,662

COSTCO WHOLESALE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(amounts in millions, except par value and share data) (unaudited)
Subject to Reclassification
	May 11, 2025				September 1, 2024
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	13,836			$	9,906
Short-term investments		1,014				1,238
Receivables, net		2,875				2,721
Merchandise inventories		18,606				18,647
Other current assets		1,820				1,734
Total current assets		38,151				34,246
OTHER ASSETS
Property and equipment, net		30,582				29,032
Operating lease right-of-use assets		2,718				2,617
Other long-term assets		4,031				3,936
TOTAL ASSETS	$	75,482			$	69,831
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Accounts payable	$	19,820			$	19,421
Accrued salaries and benefits		4,813				4,794
Accrued member rewards		2,583				2,435
Deferred membership fees		2,931				2,501
Other current liabilities		7,432				6,313
Total current liabilities		37,579				35,464
OTHER LIABILITIES
Long-term debt, excluding current portion		5,717				5,794
Long-term operating lease liabilities		2,463				2,375
Other long-term liabilities		2,598				2,576
TOTAL LIABILITIES		48,357				46,209
COMMITMENTS AND CONTINGENCIES
EQUITY
Preferred stock $0.005 par value; 100,000,000 shares authorized; no shares issued and outstanding		—				—
Common stock $0.005 par value; 900,000,000 shares authorized; 443,519,000 and 443,126,000 shares issued and outstanding		2				2
Additional paid-in capital		8,148				7,829
Accumulated other comprehensive loss		(1,915	)			(1,828	)
Retained earnings		20,890				17,619
TOTAL EQUITY		27,125				23,622
TOTAL LIABILITIES AND EQUITY	$	75,482			$	69,831

COSTCO WHOLESALE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(amounts in millions) (unaudited)
Subject to Reclassification
	36 Weeks Ended
	May 11, 2025				May 12, 2024
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	5,489			$	5,013
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		1,652				1,531
Non-cash lease expense		208				220
Stock-based compensation		720				686
Other non-cash operating activities, net		(15	)			(35	)
Changes in working capital		1,414				966
Net cash provided by operating activities		9,468				8,381
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of short-term investments		(573	)			(1,007	)
Maturities of short-term investments		786				1,441
Additions to property and equipment		(3,532	)			(3,133	)
Other investing activities, net		(24	)			(7	)
Net cash used in investing activities		(3,343	)			(2,706	)
CASH FLOWS FROM FINANCING ACTIVITIES
Repayments of short-term borrowings		(635	)			(637	)
Proceeds from short-term borrowings		616				628
Proceeds from issuance of long-term debt		—				498
Tax withholdings on stock-based awards		(392	)			(313	)
Repurchases of common stock		(623	)			(484	)
Cash dividend payments		(1,030	)			(8,527	)
Financing lease payments and other financing activities, net		(118	)			(113	)
Net cash used in financing activities		(2,182	)			(8,948	)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS		(13	)			(23	)
Net change in cash and cash equivalents		3,930				(3,296	)
CASH AND CASH EQUIVALENTS BEGINNING OF YEAR		9,906				13,700
CASH AND CASH EQUIVALENTS END OF PERIOD	$	13,836			$	10,404

FAQ

What was Costco's (COST) earnings per share in Q3 2025?

Costco reported earnings of $4.28 per diluted share in Q3 2025, up from $3.78 per diluted share in the same period last year.

How much did Costco's (COST) net sales grow in Q3 2025?

Costco's net sales grew 8.0% to $61.96 billion in Q3 2025, compared to $57.39 billion in the same quarter last year.

What was Costco's (COST) membership fee revenue in Q3 2025?

Costco's membership fee revenue was $1.24 billion in Q3 2025, increasing from $1.123 billion in the same quarter last year.

How many warehouses does Costco operate globally as of Q3 2025?

Costco operates 905 warehouses across 13 countries, including 624 in the United States and Puerto Rico.

What was Costco's (COST) e-commerce sales growth in Q3 2025?

Costco's e-commerce sales grew 14.8% (15.7% adjusted) in Q3 2025.