What it does
The company states that it operates membership warehouses and e-commerce sites. Its model combines low prices with a limited assortment of nationally branded and private-label products across food, non-food, fresh-food, ancillary, and other-business categories. It buys most merchandise directly from suppliers, moving goods through depots or directly to warehouses; e-commerce orders may use depots, logistics operations, supplier drop-ship, and other delivery arrangements. The filing lists gasoline, pharmacy, food court, optical, hearing aids, and tire installation among warehouse ancillary offerings.
Source: Costco Wholesale Corporation Form 10-K for fiscal 2026, Item 1 — sec.gov
How it makes money
The company reports revenue from merchandise categories, warehouse ancillary and other businesses, and membership fees. In fiscal 2026, Food and Sundries revenue was $116.8 billion, or 38.5% of revenue, while Non-Foods revenue was $77.4 billion, or 25.5%. Warehouse ancillary and other businesses produced $61.4 billion, and Fresh Foods produced $41.7 billion. Membership fees revenue was $5.9 billion. The filing says members pay an annual membership fee and that members may use their memberships at all warehouses and e-commerce sites.
| Product or service | Revenue, FY2026 | Share | Change on the year |
|---|---|---|---|
| Food and Sundries | $116.8 billion | 38.5% | 6.59% |
| Non-Foods | $77.4 billion | 25.5% | 8.69% |
| Warehouse ancillary and other businesses | $61.4 billion | 20.2% | 19.9% |
| Fresh Foods | $41.7 billion | 13.8% | 9.81% |
| Membership fees | $5.9 billion | 1.95% | 11.0% |
Source: Costco Wholesale Corporation Form 10-K for fiscal 2026, Item 1 — sec.gov
Customers and geography
The company’s customers are members, who may use their memberships at all of its warehouses and e-commerce sites. The filing says its membership fee is $65 annually in the U.S., varies in other countries, and includes a free household card. Costco operated 939 warehouses worldwide at August 30, 2026. It operates warehouses in the U.S. and Puerto Rico, Canada, Mexico, Japan, the U.K., Korea, Australia, Taiwan, China, Spain, France, Sweden, Iceland, and New Zealand. It also operates e-commerce sites in nine listed markets.
| Segment | Revenue, FY2026 | Share | Change on the year |
|---|---|---|---|
| United States | $219.8 billion | 72.5% | 9.89% |
| Other International | $42.8 billion | 14.1% | 11.8% |
| Canada | $40.6 billion | 13.4% | 9.85% |
Source: Costco Wholesale Corporation Form 10-K for fiscal 2026, Item 1 — sec.gov
Competition
The filing characterizes the industry as highly competitive, citing price, merchandise quality and selection, location, convenience, distribution strategy, and customer service. It states that Costco competes worldwide with wholesalers and retailers including supermarkets, supercenters, online retailers, gasoline stations, hard discounters, department and specialty stores, and single-category operators. The filing specifically names Walmart, Target, Kroger, and Amazon as significant general-merchandise retail competitors in the U.S. It also identifies Walmart’s Sam’s Club and BJ’s Wholesale Club as competing warehouse clubs in the U.S.
Source: Costco Wholesale Corporation Form 10-K for fiscal 2026, Item 1 — sec.gov
Key risks
- The company states it is highly dependent on the financial performance of its U.S. and Canadian operations.
- It may be unsuccessful implementing its growth strategy, including expanding in existing and new markets and integrating acquisitions.
- Its failure to maintain membership growth, loyalty, brand recognition, and culture could adversely affect results.
- Disruptions in merchandise distribution or processing, packaging, manufacturing, and other facilities could adversely affect sales and member satisfaction.
- IT-system availability and performance are vital; failure to execute IT projects or keep systems available could adversely affect operations.
- The company is required to maintain privacy and security of personal and business information amid multiplying threats and increasing global regulations.
Source: Costco Wholesale Corporation Form 10-K for fiscal 2026, Item 1A — sec.gov
People and operations
At the end of 2026, the company employed 355,000 people worldwide; approximately 95% worked in membership warehouses and distribution channels, and around 5% were represented by unions. The company also uses seasonal employees. Its average warehouse occupies approximately 148,000 square feet. The filing says the company operates on a 52/53-week fiscal year ending on the Sunday nearest the end of August. It identifies increased net sales and earnings during the winter holiday season as the material seasonal impact on operations.
Source: Costco Wholesale Corporation Form 10-K for fiscal 2026, Item 1 — sec.gov