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Costco (COST) delivered another strong quarter in 4Q25, extending its streak of earnings beats (11 of the past 12 quarters) as its efficient model continues to shine in a difficult retail landscape. However, comp sales of +5.7% fell just shy of expectations, though on an adjusted basis (ex-gasoline and FX) comps were strong at +6.4%.

• EPS of $5.87 (+14% yr/yr) topped consensus, reflecting disciplined cost control and operating leverage.
• Total revenue grew 8% yr/yr to $84.4 bln, supported by 13.6% e-commerce growth.
• Headline comparable sales rose +5.7% but were +6.4% when excluding gas and FX headwinds. U.S. traffic was +3.7%, with ticket up 1.9%.
• Membership fee income jumped 14% to $1.72 bln, aided by last year’s fee increase and strong upgrades to Executive membership.
• Newly introduced Executive-only shopping hours added roughly 1% to weekly U.S. sales.
• Category performance was broad-based: fresh foods posted high-single-digit growth (meat leading with double-digit increases), non-food categories saw high-single-digit comps with standout strength in gold & jewelry, consumer electronics, toys, gift cards, and men’s apparel. Food and sundries delivered mid- to high-single-digit gains, led by cola and candy.
• COST continued to mitigate tariff pressures through flexible sourcing and shifting its assortment. The company leaned more heavily on categories like health & beauty, tires, and mattresses, while its Kirkland Signature brand further strengthened penetration and margins.
• Management acknowledged growing competitive pressure, particularly from Amazon’s (AMZN) launch of a same-day grocery delivery service during the quarter. Still, Instacart (CART) and Uber Eats (UBER) partnerships remain accretive, with digital traffic up 27% and big-ticket logistics deliveries up 13%.

Briefing.com Analyst Insight:

COST’s Q4 results underscore the company’s unique ability to blend value, traffic-driving categories, and membership economics into consistent earnings beats. The slight miss on headline comps is largely a function of gas price deflation and FX noise, not an underlying demand issue. More concerning is the competitive encroachment from AMZN’s new same-day service, which could pressure COST’s digital grocery share over time. However, COST’s tariff agility, category depth, and membership fee momentum create significant cushion. With 38.7 mln Executive members now representing nearly three-quarters of sales, COST’s model remains as resilient as ever.