Key Highlights

● Costco reported fiscal fourth-quarter Revenue of $95.72 billion, ahead of the $94.88 billion analysts expected, with Earnings Per Share of $6.75 beating estimates of about $6.53.

● Costco's CFO said members are very resilient and willing to spend on discretionary items, even as broader consumer sentiment surveys hit a four-month low the same day.

● Membership fee revenue growth slowed, a metric investors watch closely since fees are central to Costco's low-markup Business model.

● About $0.15 of the quarter's earnings per share came from Tariff refunds, a one-off boost that analysts will likely separate from underlying operating performance.

Costco Wholesale delivered what investors wanted to see. For its fiscal fourth quarter, the Warehouse club (NASDAQ:COST) reported revenue of $95.72 billion, ahead of the $94.88 billion analysts had expected. Earnings per share came in at $6.75, topping the estimate of about $6.53. Comparable sales, which strip out the effect of new stores, were strong.

A Beat on Both Lines

Shares slipped in premarket trading as investors picked through the details, but they turned higher during the regular session and closed with a solid gain.

The CFO's Message on Shoppers

The line that resonated most came from Costco's chief financial officer, who said members are "very resilient" and willing to spend on discretionary items. That is a notable comment in the current climate. On the same day, the University of Michigan's final September consumer sentiment reading fell to 48.1 from 51.7 in August, a four-month low, and Personal Finance expectations weakened.

The survey pointed to elevated fuel prices and trade disputes as risks to household spending. With US gasoline near $4.50 a gallon and Mortgage rates jumping this week, households are under pressure. Costco's comments suggest that, at least among its members, spending is holding up, possibly because shoppers seek value in bulk buying when budgets are tight.

The Fine Print Investors Noticed

Not every number was glowing. Membership fee revenue growth slowed. Membership fees are central to Costco's model: the company keeps product markups low and earns a large share of its profit from the annual fees members pay. Any slowdown there draws attention, which may explain some of the early hesitation.

Investors also noted that about $0.15 of the quarter's earnings per share came from tariff refunds. That is a one-off boost rather than something generated by day-to-day operations, so analysts will likely separate it when judging underlying performance. Even so, the headline beat and strong comparable sales carried the day.

Costco runs large warehouse stores where members pay an annual fee to buy groceries, household goods, electronics and more in bulk at low prices. It also sells fuel at many locations, which draws traffic when pump prices rise.

A Supportive Market Backdrop

Costco's gain came on a positive day for the Nasdaq-100 and the broader market. The Nasdaq Composite rose 129.34 points to 27,068.72, the S&P 500 added 39.28 points to 7,743.41, and the Dow Jones Industrial Average jumped 478.64 points to 51,828.62, snapping a three-week losing streak. The VIX eased to 14.87.

Trade was also in focus. Chinese leader Xi Jinping's state visit ended with limited policy outcomes but no immediate tariff escalation, and the US Trade Representative said details of agreements on agricultural products and medical devices would be released on Monday. Tariff policy matters for retailers, as Costco's tariff-refund benefit this quarter shows.

Whether Membership Growth Can Stabilise

Next week's PCE price index, the Federal Reserve's preferred Inflation gauge, will show how prices are affecting consumers. ISM manufacturing, JOLTS and nonfarm payrolls will round out the picture of the economy. Investors will also watch Costco's monthly sales updates and its next quarterly report, when scheduled, for signs of whether membership fee growth stabilises and whether member spending stays as resilient as the CFO described.