How strong was Costco's sales growth in the second quarter of fiscal 2025?

Net sales rose 9.1% to $62.53 billion. Reported comparable sales grew 6.8%, but excluding changes in gasoline prices and foreign exchange, comparable sales grew 9.1%, indicating that fuel price declines and currency effects held down the headline figure.

Did earnings growth keep pace with sales growth?

Not on a reported basis. Diluted EPS rose only 2.6% to $4.02 because last year's quarter included a $94 million tax benefit tied to the special dividend. Excluding that benefit, net income and diluted EPS both grew about 8.4%, which is closer to the sales trend. Foreign currency translation reduced net income by about $57 million, or $0.13 per share.

Which segments or channels drove the results?

The U.S. was the main driver, with adjusted comparable sales up 8.6%. E-commerce was the standout channel, with adjusted comparable sales up 22.2%. Canada and Other International were weaker on a reported basis, at 4.6% and 1.7%, respectively, largely because of currency effects.

What does the February sales release tell investors about the trend?

February net sales increased 8.8% to $19.81 billion, and adjusted total comparable sales grew 8.3%. Year-to-date sales through 26 weeks rose 8.3% to $133.36 billion, which suggests the quarter's momentum carried into the following month.

Is Costco continuing to expand its warehouse footprint and maintain member loyalty?

Yes. Costco ended the quarter with 897 warehouses and expects 915 by fiscal year-end 2025, with 18 openings planned for the rest of the year. The worldwide membership renewal rate was 90.5%, and the U.S. and Canada rate was 93.0%, which supports the recurring membership fee base.

COST 8-K: Earnings & Results

01—Abstract

Summary

Summary of the 8-K filed March 6, 2025. Cited figures are marked; the original filing is the authoritative source.

Costco reported second-quarter fiscal 2025 results (twelve weeks ended February 16, 2025) showing net sales up 9.1% to $62.53 billion^a and net income of $1,788 million, or $4.02 per diluted share, versus $3.92 a year earlier.

Total revenue rose to $63.72 billion^b, with membership fees up 7.4% to $1.19 billion. Operating income increased about 12% to $2.32 billion, and gross margin on net sales improved 5 basis points year over year. Year-to-date, net sales for the first 24 weeks rose 8.3% and diluted EPS reached $8.06, versus $7.49 last year.

The quarter's reported comparable sales growth was 6.8%^c company-wide, while growth excluding gasoline price and foreign exchange effects was 9.1%. The quarter's headline strength came from the U.S. and e-commerce. U.S. adjusted comparable sales rose 8.6% and e-commerce comparable sales grew 22.2% on an adjusted basis (20.9% reported).

Canada and Other International were weaker on a reported basis, with Other International comparable sales at only 1.7%, reflecting currency translation pressure and a negative translation impact of about $57 million^d on net income. Membership metrics remained healthy, with a 90.5% worldwide renewal rate, a 93.0% U.S. and Canada renewal rate, 78.4 million paid memberships (up 6.8%), and 36.9 million executive members. The filing also disclosed February sales for the four-week period ended March 2, 2025, with net sales of $19.81 billion, up 8.8%, and total comparable sales growth of 6.5% reported (8.3% adjusted).

Year-to-date sales through 26 weeks reached $133.36 billion, up 8.3%. Costco also reiterated its warehouse expansion plan, projecting 915 warehouses by fiscal year-end 2025, with 18 openings in the remainder of the year. Balance sheet strength improved, with cash and equivalents rising to $12.36 billion from $9.91 billion at fiscal year-end 2024, while capital expenditures increased to $2.40 billion for the first 24 weeks.

02—Key points

Key Highlights

Q2 FY2025 net sales rose 9.1% to $62.53 billion; total revenue reached $63.72 billion, up 9.0% year over year.
Q2 diluted EPS of $4.02 grew 2.6% reported, or 8.4% excluding last year's $0.21 special-dividend tax benefit.
Adjusted total company comparable sales grew 9.1% (6.8% reported), led by U.S. adjusted comps of 8.6%.
E-commerce comparable sales increased 22.2% adjusted (20.9% reported), with site traffic up 13% and average order value up 10%.
Membership fee income rose 7.4% to $1.19 billion; paid members reached 78.4 million (up 6.8%) and executive members reached 36.9 million.
February (four weeks ended March 2, 2025) net sales increased 8.8% to $19.81 billion, with adjusted comparable sales of 8.3%.
Gross margin improved 5 basis points to 10.85% of net sales, while cash and equivalents rose to $12.36 billion at quarter end.

03—Questions

Frequently Asked Questions

How strong was Costco's sales growth in the second quarter of fiscal 2025?
Net sales rose 9.1% to $62.53 billion. Reported comparable sales grew 6.8%, but excluding changes in gasoline prices and foreign exchange, comparable sales grew 9.1%, indicating that fuel price declines and currency effects held down the headline figure.
Did earnings growth keep pace with sales growth?
Not on a reported basis. Diluted EPS rose only 2.6% to $4.02 because last year's quarter included a $94 million tax benefit tied to the special dividend. Excluding that benefit, net income and diluted EPS both grew about 8.4%, which is closer to the sales trend. Foreign currency translation reduced net income by about $57 million, or $0.13 per share.
Which segments or channels drove the results?
The U.S. was the main driver, with adjusted comparable sales up 8.6%. E-commerce was the standout channel, with adjusted comparable sales up 22.2%. Canada and Other International were weaker on a reported basis, at 4.6% and 1.7%, respectively, largely because of currency effects.
What does the February sales release tell investors about the trend?
February net sales increased 8.8% to $19.81 billion, and adjusted total comparable sales grew 8.3%. Year-to-date sales through 26 weeks rose 8.3% to $133.36 billion, which suggests the quarter's momentum carried into the following month.
Is Costco continuing to expand its warehouse footprint and maintain member loyalty?
Yes. Costco ended the quarter with 897 warehouses and expects 915 by fiscal year-end 2025, with 18 openings planned for the rest of the year. The worldwide membership renewal rate was 90.5%, and the U.S. and Canada rate was 93.0%, which supports the recurring membership fee base.

04—Continue

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