Costco Q4 Sales Surge: What Shoppers Should Know

Comparable Sales Growth Defies Market Trends

The company announced comparable-store sales growth of 6.7% in the fourth quarter when excluding gas and foreign exchange impacts. Within the United States alone, the figure reached 7.2%, substantially outperforming the sluggish results reported by conventional supermarket operators. This performance reflects Costco’s unique ability to attract two distinct consumer segments simultaneously: budget-minded shoppers searching for everyday value and affluent members willing to spend on premium or indulgent products.

Gary Millerchip, the company’s executive vice president and chief financial officer, highlighted this dual appeal during an earnings presentation, stating that Costco successfully delivers on both value and premium expectations. The bakery and meat departments emerged as standout performers within fresh foods, with in-house pastries experiencing a remarkable 100% sales increase during the quarter thanks to new premium offerings.

Consumer Preferences Shift Toward Healthier Options

Beyond traditional grocery staples, the earnings data reveals meaningful changes in how shoppers are filling their carts. Food and sundries comparable sales rose in the low to mid-single digit range, driven primarily by packaged foods, frozen goods, and sundries. More notably, members increasingly gravitated toward nutritious options including meat snacks, sardines, canned tuna, chicken, and high-fiber items such as edamame and granola snacks.

These purchasing patterns suggest that members are not simply trading down to cheaper alternatives but rather making deliberate choices about protein sources and dietary fiber content. This trend opens opportunities for shoppers to find value through bulk purchasing of items aligned with their health and wellness goals.

Pharmacy and Health Beauty Categories Surge

Pharmacy and health and beauty emerged as standout categories in the fourth quarter, driven in part by aggressive pricing on GLP-1 medications. The company’s pharmaceutical division benefitted from both member demand and strategic pricing decisions that positioned Costco competitively within the evolving healthcare landscape.

The company also received $184 million in tariff refunds during the quarter, most of which was reinvested into maintaining aggressive pricing across product lines. Management expects a similar level of refunds in the first quarter of the upcoming fiscal year, suggesting continued pricing stability for shoppers in the months ahead.

Digital Growth Accelerates While Costco Next Closes

Digital commerce continues to expand, with comparable online sales climbing 19.8% for the quarter and 20.7% for the full year. Website and app traffic surged 30% in the fourth quarter, demonstrating sustained member engagement with Costco’s digital channels. Pharmacy, home furnishings, small appliances, hardware, housewares, domestics, and health and beauty products all drove strong digital performance.

However, the company announced the discontinuation of Costco Next, its third-party digital marketplace, folding the operation into its traditional ecommerce platform. Management determined that integrating popular items and brands from Costco Next directly into the main Costco app and website would provide a superior member experience and drive higher sales velocity. For shoppers, this consolidation means a simpler browsing experience and potentially faster checkout processes across digital sales channels.

What This Means for Your Shopping Strategy

The financial results underscore several meaningful takeaways for consumers. First, Costco’s strong performance suggests the membership model continues delivering tangible value, justifying the annual fee investment for regular shoppers. Second, the company’s emphasis on both budget items and premium offerings means there is something for every membership tier and spending preference.

Third, the visible rotation toward healthier packaged proteins and high-fiber options indicates that inventory decisions are responding to what members actually want. This consumer-driven approach to merchandising typically means better selection in these categories. Finally, the closure of Costco Next and streamlined digital operations should make online shopping smoother, with better product visibility across the company’s app and website.

Looking Ahead

For the fiscal year 2027, Costco intends to open 33 new locations, including five relocations, across its 939-warehouse footprint. Currently operating 647 warehouses in the United States, the company remains focused on geographic expansion while maintaining the member experience that has driven consistent outperformance against industry peers.

The fourth quarter net income rose 14.8% year-over-year to nearly $3 billion, and full-year net income increased 13.9% to approximately $8.1 billion. Total revenues including membership fees reached $95.72 billion in the quarter and $303.15 billion for the full year, both significantly higher than the prior year. These metrics demonstrate financial health that should provide shoppers confidence in the company’s ability to maintain competitive pricing and service levels going forward.