A strong fourth-quarter finish to the fiscal year helped Costco post significant 2026 financial gains helped by a solid contribution from home furnishings and housewares.
Net income was $3 billion, or $6.75 per diluted share, versus $2.61 billion, or $5.87 per diluted share, in the year-previous quarter, the company reported.
Income per diluted share topped a Zacks Investment Research analyst consensus estimate of $6.48 while revenues beat a $94.82 billion revenue forecast.
Costco recorded a non-recurring benefit of 15 cents per diluted share from IEEPA tariff refunds in the fourth quarter, less partial reinvestment of those refunds in enhanced member values.
Comparable sales excluding the effects of foreign exchange and fuel price volatility were up 7.2% in the United States, 4.6% in Canada and 6.2% in other international markets for a total company gain of 6.7% in the quarter year over year. Digitally-enabled comp sales were up 19.8% from the year-before period.
Net sales increased to $93.87 billion from $84.43 billion in the year-earlier quarter, while revenues gained to $95.72 billion from $86.16 billion, the company stated. Operating income was $3.8 billion versus $3.34 billion in the year-prior period.
Full fiscal-year net income was $9.23 billion, or $20.76 per diluted share, versus $8.1 billion, or $18.21 per diluted share, in the prior year.
Comparable sales without foreign exchange and fuel were up 6.6% in the U.S., 6.7% in Canada, 6.5% in other international markets and 6.6% for the total company year over year. Digitally enabled comp sales rose 20.7% from the prior year.
Net sales for the fiscal year increased to $297.25 billion from $269.91 billion in the year earlier, while revenues gained to $303.15 billion from $275.24 billion. Operating income was $11.69 billion versus $10.38 billion the prior year.
In a conference call, Ron Vachris, Costco CEO, addressed the tariff refund, saying, “We received some initial tariff refunds in the fourth quarter, and we reinvested some of these dollars to give value back to our members. This was predominantly through price reductions on a number of items in the second half of the quarter, including everyday items in produce, meat and beverages, and some non-food items such as home furnishings and hardware.”
CFO Gary Millerchip said Costco Non-Foods comps were up in the mid- to high-single digits year over year in the fourth quarter. Top performing merchandising categories were gold and jewelry, home furnishings, housewares, small electrics, and health and beauty. Food & Sundries comp sales gained in the low to mid-single digits while Fresh Food comps increased in the mid-single digits.
Vachris pointed out that Costco has enjoyed success building its membership among consumers under 40, up 60% since the COVID-19 pandemic, suggesting the company continues to attract shoppers generation to generation.
On store expansion, Vachris maintained: “In the fourth quarter, we opened 12 warehouses, including a relocation in Taiwan, 10 new U.S. buildings and our 43rd warehouse in Mexico. For the fiscal year, we opened 28 new warehouses, including three relocations for a total of 25 net new buildings. This brings our warehouse count to 939 worldwide. Our current plan is to open another 33 warehouses in fiscal year 2027, of which five are relocations, as we build towards our goal of opening 30 net new warehouses per year.”
