In This Story
The $1.50 Costco hot dog — a still point in a turning world, immune to tariffs, inflation, or even Jay Powell — remains the most reliable deal in America. In a time of relentless volatility, the Costco hot dog stands firm.
That’s the lesson of Costco earnings, released after Thursday’s bell, which show that the company’s value-first model — source of cult-like customer loyalty — is still delivering, even “in this economy.”
Solid growth across every key metric
The bargain-retail giant posted an 8% year-over-year jump in net sales, reaching $62 billion for the quarter, while net income rose 13% to $1.9 billion, or $4.28 per diluted share. Revenue from membership fees — almost every dollar of which falls right to the bottom line — grew 10% to $1.24 billion, as customer loyalty stayed rock solid.
Costco now counts almost 80 million paid members and 143 million total cardholders, both up more than 6% from last year. Eye-watering renewal rates continue to dazzle: 90.2% globally and a stunning 92.7% in the US and Canada. Executive memberships — which give members 2% cash back on purchases — now make up 47% of all paid memberships and drive over 73% of total sales. That level of loyalty is virtually unheard of in retail, providing Costco with a pricing edge and recurring revenue stream most retailers can only dream of.
Same-store sales showed the same trends. Adjusted for fuel and currency, comparable sales rose 8% company-wide, with U.S. stores up nearly 8% and e-commerce climbing an impressive 15.7%. The company credited standout categories like gold and jewelry, small electronics, and home furnishings, along with a 20% spike in site traffic and a 31% increase in Costco Logistics deliveries.
Operating income climbed to $2.5 billion, and the company’s cash hoard rose to nearly $14 billion.
The takeaway
Clearly, Costco’s model — combining bulk bargains, paid memberships, and a diehard loyal customer base — is shielding it from broader retail volatility.
Still, investors are cautious. On Friday, Costco shares edged down premarket alongside the S&P 500 (which includes Costco) and Dow futures. Wall Street is waiting for April’s core PCE index (the Fed’s inflation gauge of choice) to arrive later in the day, bringing clues on pricing trends. In the meantime, one number remains comfortingly static: $1.50 for a hot dog and soda.