Costco is due to report fiscal 2026 fourth-quarter results after market close Sept. 24; net sales are already known at $93.9 billion, up 11.3% year over year. The September 2024 U.S. and Canada fee increase is nearly fully phased into results, potentially ending its major boost.
Membership fees generated $5.3 billion in fiscal 2025, about half of Costco’s $10.4 billion operating income. Fee income grew 14% in the year-earlier fourth quarter and nearly 14% through the first half of fiscal 2026, before slowing to 10.7% ($1.37 billion) in Q3. CFO Gary Millerchip said a little more than a quarter of Q3 growth came from the fee increase. Costco recognizes fees over each member’s one-year term, so the increase phased in gradually. Its Sept. 17 nationwide DoorDash launch came after Q4 ended; any membership-fee boost from it would fall in fiscal 2027.
Gross margin was 11.04% in Q3, down from 11.25% a year earlier; management said it invested in lower prices on everyday goods. Gas prices and tariffs could also affect margins. Costco said in court filings it had received about a third of the tariff refunds it was owed and had begun returning that value to members through lower prices. Last year’s Q4 earnings per share were $5.87. Shares traded around $899, or 45 times earnings, and the writer argues that valuation leaves little room for a disappointing report.
