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Costco’s third-quarter sales grew 11.6%, exceeding Wall Street forecasts, driven by higher membership numbers, digital growth, and record gas volumes. The company also expects tariff refunds to benefit future pricing.
Costco Wholesale reported its fiscal third-quarter revenue of $70.53 billion, an 11.6% increase from last year, beating Wall Street expectations. The company’s strong performance was driven by higher membership growth, record gas sales, and increased digital engagement, highlighting its resilience amid macroeconomic uncertainty.
In its latest quarter, Costco posted net income of $2.19 billion, or $4.93 per share, compared to $1.9 billion, or $4.28 per share, a year earlier. The company’s net sales exceeded expectations, with analysts forecasting $69.81 billion, while actual sales reached $70.53 billion. Adjusted comparable sales rose 6.6%, with digital sales increasing nearly 21%, reflecting a shift toward online shopping.
Membership numbers grew by 4.1%, and website and app traffic surged 37%. The retailer highlighted record volumes for fuel sales, especially in the final five weeks of the quarter, driven by customers seeking cheaper gas amid rising fuel prices and geopolitical tensions. Top-performing categories included pharmacy, home furnishings, and jewelry. Costco also noted ongoing efforts to recover tariffs through refund claims following a Supreme Court ruling, with plans to pass some savings to members.
Why It Matters
This earnings report underscores Costco’s ability to outperform expectations amid economic headwinds, with strong growth in sales, memberships, and digital channels. The record fuel sales and increased customer loyalty suggest continued resilience and potential for further expansion, making it a key indicator of retail sector health and consumer confidence.
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Background
Costco’s recent performance follows a period of macroeconomic uncertainty, including inflation and geopolitical tensions. The company has previously emphasized value offerings and low prices as key to attracting cost-conscious consumers. The ongoing tariff dispute with the U.S. government and efforts to recover refunds are also part of its strategic outlook. Analysts had anticipated increased demand due to rising fuel prices and a shift toward value shopping, which appears to be materializing in the latest results.
“Against the backdrop of ongoing macro uncertainty, our focus is providing quality goods and services at the lowest possible price.”
— Ron Vachris, CEO of Costco
“Our goal is to be the first to lower prices and the last to raise them.”
— Ron Vachris, CEO of Costco
What Remains Unclear
It remains unclear how much of the tariff refunds Costco will ultimately receive and pass to members, as well as how sustained the growth in digital sales and memberships will be in the coming quarters. The impact of geopolitical tensions on fuel sales and consumer spending is also still developing.
What’s Next
Costco is expected to continue submitting tariff refund claims, with refunds anticipated over the next few months. The company will likely monitor consumer spending patterns and fuel sales closely, providing future guidance on profitability and growth prospects in upcoming earnings reports.
Key Questions
What contributed to Costco’s higher sales in Q3 2026?
Key factors included increased memberships, record fuel volumes, a surge in digital sales, and strong performance in categories like pharmacy and jewelry.
How did Costco perform financially compared to analyst expectations?
Costco exceeded revenue expectations with $70.53 billion versus the expected $69.81 billion, and earnings per share matched forecasts at $4.93.
What is the significance of the tariff refunds mentioned?
Costco is recovering tariffs through refund claims, which could lead to lower costs and potential savings passed to members, supporting its pricing strategy.
What are the company’s main growth drivers currently?
Growth drivers include memberships, digital sales, fuel sales, and key categories like pharmacy and home furnishings.
Source: Google Trends
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