What is the overall financial performance of Costco in the reported quarter?

Costco reported a strong third quarter of fiscal year 2025 with an 8% increase in net sales to $61.965 billion and a 10% increase in membership fee revenue to $1.240 billion. Net income also grew to $1.903 billion, or $4.28 per diluted share, demonstrating continued operational strength and profitability.

How is the company managing its costs and margins?

Costco saw a positive increase in gross margin percentage by 41 basis points in the third quarter, reaching 11.25%. This improvement was driven by core merchandise categories and warehouse ancillary services, partially offset by a LIFO charge and a one-time expense. Selling, general, and administrative expenses as a percentage of net sales increased slightly by 20 basis points, reflecting investments in employee wages and operational costs.

What are the key drivers of revenue growth?

Revenue growth is primarily driven by a 6% increase in comparable sales across the company, supported by new warehouse openings (29 net new warehouses since Q3 FY24). Membership fees, a significant contributor to profitability, also increased by 10% due to new member acquisition and recent membership fee adjustments.

How is Costco investing in its future growth?

The company is actively investing in expansion, with capital expenditures of $3.532 billion in the first 36 weeks of fiscal year 2025, and plans to spend over $5 billion in fiscal year 2025. These investments are focused on opening new warehouses and updating existing facilities to support future sales growth.

COST 10-Q Quarterly Report Q3 FY2025 — Revenue, Net Income, EPS

Summary

Costco Wholesale Corporation reported robust financial performance for the third quarter and first thirty-six weeks of fiscal year 2025. The company demonstrated strong top-line growth with an 8% increase in net sales to $61.965 billion for the quarter and $185.480 billion year-to-date, driven by comparable sales growth of 6% and the opening of 29 new warehouses. Membership fee revenue also saw a healthy 10% increase to $1.240 billion in the quarter, signaling sustained member loyalty and the positive impact of recent membership fee adjustments. Profitability improved with net income rising to $1.903 billion for the quarter and $5.489 billion year-to-date, resulting in diluted earnings per share of $4.28 and $12.34, respectively. This performance was supported by a 41 basis point increase in gross margin percentage for the quarter, despite some headwinds from LIFO charges and a one-time vacation expense. The company continued to invest in its business, with significant capital expenditures of $3.532 billion year-to-date focused on warehouse expansion, and maintained a strong liquidity position with substantial cash and investments.

Financial Highlights

48 data points

Beta

Revenue

$63.20B

0.1% Gross Margin

Net Income

$1.90B

0.0% Net Margin

EPS (Diluted)

$4.28

Total Assets

$75.48B

Cash & Equivalents

$13.84B

Free Cash Flow

$2.33B

Financial Statements

Beta

Revenue	$63.20B
Cost of Revenue	$55.00B
Gross Profit	$8.21B
SG&A Expenses	$5.68B
Operating Income	$2.53B
Interest Expense	$35.00M
Net Income	$1.90B
EPS (Basic)	$4.29
EPS (Diluted)	$4.28
Shares Outstanding (Basic)	443.96M
Shares Outstanding (Diluted)	444.76M

Key Highlights

1Net sales increased by 8% to $61.965 billion in Q3 FY25, driven by comparable sales growth of 6% and new warehouse openings.
2Membership fee revenue grew by 10% to $1.240 billion in Q3 FY25, benefiting from new members and fee increases.
3Net income rose to $1.903 billion in Q3 FY25 ($4.28 EPS), up from $1.681 billion ($3.78 EPS) in the prior year quarter.
4Gross margin percentage improved by 41 basis points in Q3 FY25, indicating better cost management and product mix.
5Cash flow from operating activities was strong at $9.468 billion for the first 36 weeks of FY25.
6Capital expenditures for the first 36 weeks of FY25 totaled $3.532 billion, with plans to spend over $5 billion in FY25 for expansion.
7The company declared a quarterly cash dividend of $1.30 per share, a 12% increase from the previous year.

COSTCO WHOLESALE CORP /NEW Quarterly Report for Q3 Ended May 11, 2025

Summary

Financial Highlights

Key Highlights

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