# COST earnings call intelligence LOPJLB CallCard / temporal rollup · freemium · [stock page](https://www.lopjlb.com/stock/COST) · [Earnings tab](https://www.lopjlb.com/stock/COST?tab=earnings) Updated: 2026-09-07T07:08:18 Quarters analyzed: 8 ## Cross-quarter narrative Across the series of Costco earnings CallCards, the company moved from a baseline of solid comparable sales growth and expanding warehouse footprint to a more nuanced picture where cost pressures, membership dynamics, and external macro factors gained prominence. Early calls (FY24 Q4, FY25 Q1) highlighted strong traffic‑driven sales, accelerating e‑commerce, and the rollout of new warehouses, while noting wage‑related SG&A headwinds and isolated supply‑chain hiccups such as Red Sea delays. By FY25 Q3 and FY25 Q4, renewal‑rate volatility from a higher share of digital sign‑ups surfaced as a recurring concern, alongside tariff‑risk and commodity price volatility. In FY26, the narrative sharpened on margin compression from gas‑price deflation, persistent wage inflation, and broader macro‑economic uncertainty, even as digital and AI initiatives (checkout upgrades, AI pharmacy, same‑day delivery) accelerated. Warehouse expansion remained on track throughout, with new locations announced globally. Overall, the evolution reflects a shift from pure growth momentum to managing cost structures, membership renewal health, and external volatility while leveraging technology to sustain demand. ## Latest CallCard · Q3 Costco Q3 2026 delivered 11.6% sales growth, record gas volumes and modest membership gains while flagging macro uncertainty, margin pressure from mix shifts and ongoing tariff refund timing. **Guidance:** vague — No explicit forward guidance; only capex estimate and warehouse pipeline mentioned. **Tone:** mgmt 0.6 · Q&A pressure 0.5 · divergence 0.4 Prepared remarks emphasize record gas volumes, new warehouse openings, digital enhancements and AI opportunities, conveying optimism. ### Demand visibility Strong demand for gasoline and core merchandise, with record gas volumes and rising digital traffic. All three 4‑week periods set all‑time gas volume records; high price sensitivity drove new members to gas stations; site and app traffic up 37% and same‑day delivery expanding in Europe. ### Margins / costs Margin pressure from gas inflation and mix shift, but gross margin stable ex‑gas. Reported gross margin down 21 bps to 11.04%; core margins down 46 bps; excluding gas inflation margin improved 1 bp; transportation costs and mix to gas/e‑commerce weighed on core‑on‑core. ### Capital allocation CapEx $1.41 B in Q3, $6.5 B full‑year for warehouses, remodels, depot network and digital upgrades. Investments include 4 new warehouses (3 US, 1 Canada), relocations, digital checkout tools, same‑day delivery rollout, AI product page work and retail‑media partnership. ### Milestones - **New warehouses opened** [on_track]: 4 net new warehouses opened (3 US, 1 Canada), total count 928. - **Warehouse relocations** [on_track]: 2 relocations completed, 1 more planned in Q4. - **Digital checkout enhancements** [on_track]: Mobile wallet, digital membership card, shopping cart prescan tool and pay‑station pilot deployed. - **Same‑day delivery in Europe** [on_track]: Launched same‑day delivery in Spain and France, U.S. avg <45 min. - **Retail media partnership** [on_track]: New collaboration with Google Commerce Media and YouTube. - **AI product page enhancements** [on_track]: Leveraging AI to improve product page relevance; traffic from AI search grew triple‑digit. - **Executive Membership in China** [delivered]: Program launched ahead of expectations with strong early adoption. - **CapEx program** [on_track]: Full‑year capex target $6.5 B to fund warehouses, depot network and digital. ### Fears / risks - **Macro uncertainty**: Ongoing geopolitical and economic factors could affect demand and supply chains. - **Gas price volatility**: Higher gas prices drive volume but compress margins and create pricing pressure. - **Tariff refund timing**: Refunds from IEEPA tariffs expected over 2‑3 months, affecting cost recovery. - **Membership growth slowdown**: Paid membership growth slowed to ~4%, the lowest in recent periods. - **Margin mix shift**: Higher share of gas, e‑commerce and pharmacy sales reduces core merchandising margins. - **Health‑care cost increase**: Rising health‑care expenses offset SG&A productivity gains. - **Legal settlements**: Central SG&A impacted by legal settlements and reserves. - **Non‑food inflation**: Higher resin and memory‑chip costs could raise non‑food item prices. ### Key quotes > “Against the backdrop of ongoing macro uncertainty, our focus is providing quality goods and services at the lowest possible price continues to resonate strongly with our members.” — Ron Vachris > “Net sales for the third quarter were $69.15 billion, an increase of 11.6% from $61.96 billion in Q3 2025.” ## Quarter one-liners - **2026 Q3:** Costco Q3 2026 delivered 11.6% sales growth, record gas volumes and modest membership gains while flagging macro uncertainty, margin pressure from mix shifts and ongoing tariff refund timing. - **2026 Q2:** Costco posted 9% sales growth and 14% net income rise, highlighted new warehouse openings, digital enhancements and pricing authority while noting weather‑related traffic dips and Middle‑East geopolitical uncertainty. - **2026 Q1:** Costco Q1 2026 saw 8 new warehouses, modest margin gains and digital rollouts, but flags renewal-rate pressure and Spain construction delays. - **2025 Q4:** Costco reports 8% sales growth, higher margins and strong membership upgrades while planning 35 new warehouses in FY2026 amid macro uncertainty. - **2025 Q3:** Costco Q3 FY2025 showed 8% sales growth, higher margins, expanding warehouse footprint and new BNPL offering, but renewal rates dip due to digital sign‑ups and tariff uncertainties. - **2025 Q2:** — - **2025 Q1:** Costco Q1 FY25: sales +7.5%, comps +7.1% ex-gas/FX, traffic +5.1%, 7 new warehouses, e-commerce +13%, but wage costs pressure SG&A and renewal rates dip slightly on digital mix shift. - **2024 Q4:** Costco Q4 FY24: comp sales +5.4% (+6.9% ex-gas/FX), membership +7.3%, e-commerce +18.9%, 30 warehouse openings, wage increases pressure SG&A, Red Sea delays persist ## Theme arcs - **Warehouse expansion** (improving): Consistently on‑track with new openings each quarter, supporting sales growth. - **Membership renewal pressure** (deteriorating): Digital sign‑ups renew at lower rates, causing a gradual dip in overall renewal percentages. - **Wage and labor cost pressure** (deteriorating): Repeated wage increases create SG&A headwinds across multiple quarters. - **E‑commerce and digital traffic** (improving): Double‑digit e‑commerce growth early, sustained digital traffic gains and new AI tools. - **Gas price deflation/volatility** (deteriorating): Deflation reduced gasoline ASP and compressed margins in FY25‑FY26. - **Supply chain disruptions** (stable): Red Sea, port‑strike risks, weather closures and Middle‑East instability recur without resolution. - **Tariff uncertainty/refunds** (deteriorating): Ongoing concerns about IEEPA tariff refunds affecting cost recovery. - **Digital/AI initiatives** (improving): Rollout of checkout tech, AI pharmacy, and same‑day delivery pilots progresses. ## Fear persistence - **Membership renewal pressure** [recurring]: Digital sign‑ups consistently renew at lower rates, dragging overall renewal percentages. - **Wage cost inflation** [recurring]: Quarterly wage hikes add SG&A pressure. - **Supply chain disruptions** [recurring]: Red Sea delays, port‑strike risks, weather closures and Middle‑East instability persist. - **Tariff uncertainty** [recurring]: IEEPA tariff refund timing remains uncertain, affecting cost recovery. ## Guidance path 2024 Q4:vague → 2025 Q1:maintained → 2025 Q2:vague → 2025 Q3:maintained → 2025 Q4:maintained → 2026 Q1:maintained → 2026 Q2:maintained → 2026 Q3:vague --- Research context only. Not personalized investment advice. API: `GET /bff/api/bigfive/earnings-intel/COST`