Costco’s first quarter results reflected continued momentum across its core business, with management highlighting the effectiveness of new warehouse openings and ongoing digital enhancements as key drivers of performance. CEO Ron Vachris emphasized that price reductions on essentials such as eggs, cheese, and coffee contributed to traffic growth, while the company’s ability to manage tariff-related pressures supported overall sales consistency. The quarter also benefited from strong demand for fresh foods and premium nonfood categories, with management crediting “meaningful improvements in the speed of checkout” and targeted upgrades in the member experience for supporting both sales and productivity.
Is now the time to buy COST? Find out in our full research report (it’s free for active Edge members).
Costco (COST) Q1 CY2026 Highlights:
- Revenue: $69.6 billion vs analyst estimates of $69.06 billion (9.2% year-on-year growth, 0.8% beat)
- Adjusted EPS: $4.58 vs analyst estimates of $4.55 (0.7% beat)
- Adjusted EBITDA: $3.20 billion vs analyst estimates of $3.23 billion (4.6% margin, 0.9% miss)
- Operating Margin: 3.7%, in line with the same quarter last year
- Locations: 924 at quarter end, up from 897 in the same quarter last year
- Same-Store Sales rose 7.4% year on year, in line with the same quarter last year
- Market Capitalization: $440.2 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Costco’s Q1 Earnings Call
- Christopher Horvers (JPMorgan) asked how weather volatility and gold price swings affected recent sales. CFO Gary Millerchip explained that weather closures slightly impacted February traffic, but overall sales trends remained consistent after adjusting for calendar shifts.
- Michael Lasser (UBS) questioned the financial impact of digital and operational enhancements. CEO Ron Vachris responded that these investments improved efficiency and member experience, with benefits reinvested in employees, pricing, and expansion.
- Charles Grom (Gordon Haskett) probed for changes in product assortment and gas price effects. Vachris confirmed a return to traditional seasonal assortments, and Millerchip noted that higher gas prices generally boost warehouse visits due to Costco’s value positioning.
- Simeon Gutman (Morgan Stanley) asked about competitive pressures and digital engagement through AI. Vachris and Millerchip said membership growth is resilient despite competitor openings, and emphasized efforts to ensure Costco’s value is visible across digital channels.
- Rupesh Parikh (Oppenheimer) asked about slowing membership growth and renewal rates. Millerchip attributed lower growth to fewer new market openings and a higher mix of online sign-ups, but expressed confidence in long-term trends and ongoing retention strategies.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will watch for (1) progress on new warehouse openings and the effectiveness of urban real estate strategies, (2) measurable gains in digital sales and personalized member engagement resulting from technology investments, and (3) management’s ability to navigate changing tariffs and supply chain risks. Execution in international markets and membership retention will also be key indicators of sustained success.
Costco currently trades at $989.40, in line with $982.57 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it’s free).
Our Favorite Stocks Right Now
ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.
Find out which 5 stocks it's flagging for this month — FREE. Get Our Top 5 Growth Stocks for Free HERE.
Stocks that have made our list include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.
