Costco: Warehouse Growth, Memberships and Cash

Costco's FY2026 total revenue rose 10.1% to $303.154 billion, including $5.907 billion of membership fees. Audited operating cash of $15.817 billion covered $6.435 billion of property investment, leaving a derived $9.382 billion, up 19.7%. Warehouse trading, fee recognition and expansion spending have different cash schedules.

Latest released reporting at October 25, 2026

FY2026 full-year results, released 2026-09-24, is the latest completed reporting release used here. Both annual periods contain 52 weeks. Membership fees are already included in total revenue; adding them again would overstate the sales base. The audited annual cash figure supersedes the preliminary earnings-release amount.

Full-year revenue (reported)

Reported whole-company revenue, before operating expenses and reinvestment; it is not a cash-flow or valuation measure. Source: FY2026 annual report and comparative statements.

Complete annual operating and cash basis

The complete annual comparison uses the FY2026 annual filing, filed 2026-10-07. Periods ended 2025-08-31 and 2026-08-30; amounts are $ millions. Filing date, fiscal-year label and period end are separate dates.

Warehouse trading and memberships contribute on different schedules

Net sales grew 10.1% and membership fee revenue 11.0%. Fees are recognized across the membership term, so cash renewals and reported fee revenue need separate schedules. Fees are already included in total revenue; they are not an additional amount to place on top of $303,154 million.

Use the October 7 audited filing for operating cash of $15,817 million, rather than the preliminary release's $15,825 million. The final subtraction is 15,817 - 6,435 = $9,382 million. Operating cash increased $2,482 million, more than the $937 million capex increase, improving the remainder by $1,545 million. Both years contain 52 weeks; the final quarter contains 16 weeks.

Test the warehouse ramp and membership calendar

Separate sales at mature warehouses from the ramp, staffing and property spending at new locations. For an illustrative sensitivity, a one-percentage-point lower merchandise margin on unchanged FY2026 net sales would reduce gross profit by $2,972.47 million before any operating-cost or tax response. This assumed case shows the scale of the trading denominator; it is not a forecast or a claim about a reported merchandise margin.

What customers pay for and what changes the economics

Costco combines merchandise sales with annual membership fees. The FY2026 filing says membership growth, Executive membership penetration and renewal rates materially affect profitability. Its renewal rate is a trailing calculation covering renewals seven to eighteen months before the reporting date, and excludes Business-member affiliates. The filing also notes that online promotions and some international membership growth can lower the aggregate renewal rate through mix. (FY2026 source.)

Analysis: Treat the renewal rate as a lagging cohort measure, not an immediate reading of this month's customer satisfaction. A lower aggregate rate can reflect new-member mix rather than worsening mature-warehouse loyalty. Conversely, a fee increase can lift recognized revenue while masking weaker new-member acquisition. Test paid membership cohorts and warehouse traffic before extrapolating the fee growth.

Operating signals to carry into the forecast

Watch these signals on a consistent period and definition. Undisclosed measures remain questions to investigate, rather than supplied KPI data.

• Renewal rate on the issuer's exact trailing definition: do not compare it with a current-month retention measure.
• Paid members and Executive penetration: distinguish member growth from tier mix.
• Comparable sales traffic versus ticket: separate more visits from inflation, fuel and currency effects where disclosed.
• New-warehouse productivity and capital spending: require the opening cohort to earn its staffing and property investment.

SWOT and the forecast consequence

SWOT classifications and forecast consequences are analytical judgments; evidence uses the dated sources cited below.

Valuation implication: A strong case combines durable renewal, useful warehouse growth and disciplined merchandise economics. Compare genuine member expansion with a fee-led case in which traffic softens. The large merchandise denominator makes a small margin change economically meaningful, as the existing sensitivity demonstrates.

Model membership collections and fee recognition separately, and connect warehouse growth to occupancy, labor and investment payments. DCF discount rates and terminal growth are analyst assumptions; a strong historical cash result does not supply a live valuation or share-price target. See the Costco DCF Analysis product page for file information.