Key Highlights
- Q4 earnings release scheduled for September 24, with fourth-quarter net sales already disclosed at $93.9 billion, reflecting an 11.3% annual increase
- Renewal rates for memberships have experienced downward pressure, falling to 92.1% in Q2 FY2026, though executives indicate the trend is stabilizing
- The warehouse retailer has significantly broadened its Uber Eats delivery collaboration, expanding from 17 states to 48 and encompassing approximately 600 stores
- RBC Capital kept its Sector Perform stance with a $1,000 target price, forecasting Q4 EPS at $6.54
- Analyst consensus leans toward Moderate Buy, with mean price targets hovering near $1,090, suggesting approximately 21% potential upside
As Costco approaches its fourth-quarter earnings announcement on September 24, significant developments have already emerged. Shares were hovering near $903 on Wednesday, experiencing modest gains following the announcement of its broadened Uber Eats collaboration.
Costco Wholesale Corporation, COST
Fourth-quarter net sales reached $93.9 billion, marking an 11.3% year-over-year increase. Comparable store sales advanced 9.4%, or 6.7% after adjusting for fuel prices and currency fluctuations. Digital sales channels posted impressive growth of 19.5%.
Given that Costco provides monthly sales updates, market participants enter earnings day with revenue figures already established. The critical unknown centers on profit margins and operational efficiency during the quarter.
Analyst expectations indicate earnings per share growth of 11.4% alongside revenue expansion of 10.1% from the prior year. RBC Capital adopts a marginally bullish stance, forecasting adjusted EPS of $6.54 versus the Street consensus of $6.50.
Membership Trends Under the Microscope
The central concern for the upcoming report revolves around membership dynamics. Renewal percentages have experienced consecutive quarterly declines, dropping from 93.0% in Q2 FY2025 down to 92.1% in Q2 FY2026.
Costco previously addressed this issue in late 2024, explaining that members acquired through digital channels have historically demonstrated somewhat lower renewal propensities. Company leadership now indicates this headwind is subsiding.
Chief Financial Officer Gary Millerchip characterized renewal rates as having “leveled out” during the most recent earnings discussion, although he refrained from providing specific forward guidance.
While membership fees represent a relatively modest revenue stream, their profitability impact is substantial. During FY2025, Costco collected $5.32 billion in membership fees, accounting for approximately 51% of its $10.38 billion total operating income.
The sustained decline in renewal rates has created investor uncertainty. COST currently trades roughly 4% beneath its initial post-Q3 closing level and approximately 8% below its pre-report valuation.
Uber Eats Partnership Reaches New Scale
Wednesday brought news that Uber Eats has dramatically scaled its Costco delivery arrangement, jumping from 17 states to 48 and bringing nearly 600 warehouse locations onto the delivery platform.
The partnership includes promotional benefits for qualifying Costco members, offering a 50% discount on first-year Uber One subscriptions, followed by 20% savings in following years.
Costco’s membership base totaled 82.90 million as of June 2026, representing growth that decelerated 4% on an annual basis. The expanded Uber Eats collaboration seems designed to enhance membership value proposition while potentially attracting new sign-ups.
Industry research from Edgewater Research published Tuesday also suggested that DoorDash might pursue its own delivery arrangement with Costco, with the possibility that the retailer could restrict delivery services to members exclusively.
RBC Capital indicated it anticipates minimal sentiment shifts following the September 24 earnings release. The firm’s $1,000 valuation derives from approximately 40 times its FY2028 adjusted earnings forecast of $25.00 per share.
Among 21 analysts tracking the stock, 15 assign Buy ratings, five recommend Hold, and one advises Sell. The consensus price target stands at $1,090.79.
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