Q2 2025 Costco Wholesale Corp Earnings Call Transcript
Key Points
- Costco Wholesale Corp (COST) reported a net income increase to $1.788 billion, or $4.02 per diluted share, up from $1.743 billion, or $3.92 per diluted share, in the same quarter last year.
- The company plans to open 28 new warehouses during fiscal year 2025, including significant expansions in the U.S. and internationally.
- Membership fee income grew by 7.4% year-over-year, with a U.S. and Canada renewal rate of 93% and a worldwide rate of 90.5%.
- E-commerce comparable sales increased by 20.9%, demonstrating strong growth in digital channels.
- Costco Wholesale Corp (COST) continues to invest in employee wages and benefits, with a new agreement that includes multiple wage increases over the next few years.
- Foreign exchange rate movements negatively impacted international net income translation to U.S. dollars by $57 million.
- The company faces headwinds from tariffs and foreign exchange fluctuations, which could impact costs and pricing strategies.
- Core on core margins were lower by 8 basis points due to higher supply chain costs and mix changes in nonfood categories.
- Gasoline sales were down low single digits due to lower volumes, impacting ancillary business performance.
- Inflationary pressures, particularly in fresh foods like meat and bakery, are affecting overall cost structures.
Ladies and gentlemen, thank you for standing by. My name is Abby, and I'll be your conference operator today. At this time, I would like to welcome everyone to the Costco Wholesale Corporation Fiscal second quarter 2025 earnings conference call. (Operator Instructions)
And I would now like to turn the conference over to Gary Millerchip, Chief Financial Officer. You may begin.
Good afternoon, everyone, and thank you for joining Costco's second quarter 2025 earnings call. In addition to covering our second quarter financial results today, we will also review our February sales results. I'd like to start by reminding you that these discussions will include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.
These statements involve risks and uncertainties that may cause actual events, results and/or performance to differ materially from those indicated by such statements. The risks and uncertainties
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