Costco Wholesale Corporation (Nasdaq: COST), a leading global retailer known for its membership-only warehouse club model, reported its second-quarter results for fiscal year 2025, which ended February 16, 2025. The company demonstrated strong financial performance, indicating an upward trend in key metrics.

For the quarter, Costco generated net sales of $62.53 billion, reflecting a 9.1% increase from $57.33 billion in the same quarter of the previous year. Net income was reported at $1.788 billion, equivalent to $4.02 per diluted share, up from $1.743 billion or $3.92 per diluted share year-over-year. The increase in earnings is notable, particularly when excluding a one-time tax benefit impacting last year’s results.

Operating income rose by 12.3% year-over-year, influenced by operational efficiencies and strong sales performance across various departments. Foreign exchange fluctuations negatively impacted the company’s international results by approximately $57 million, translating to $0.13 per diluted share.

Comparable sales for the quarter increased by 6.8%, with U.S. comparable sales growing by 8.3% and Canada exhibiting a 4.6% rise. Excluding the impacts of gas price devaluation, U.S. comparable sales increased by 8.6%. E-commerce sales were particularly strong, with an increase of 20.9% year-over-year, demonstrating the brand’s growing online presence.

Membership fee income rose to $1.193 billion, an increase of 7.4%, with growth of 9.4% when adjusted for foreign exchange effects. Costco’s renewal rates remained robust, reported at 93% in the U.S. and Canada.

Gross margin for the quarter improved to 10.85%, up by 5 basis points compared to the prior year. Selling, general, and administrative (SG&A) expenses as a percentage of sales decreased to 9.06%, a reduction of 8 basis points year-over-year.

In terms of traffic and sales metrics, worldwide traffic increased by 5.7%, while the average transaction size grew by 1%. Adjusting for gasprice devaluation and foreign currency impacts, the average transaction value would have seen a larger increase.

For the four-week period ending February 28, 2025, Costco’s net sales were $19.81 billion, an 8.8% increase year-over-year. Comparable sales for February grew by 6.5%, with U.S. comparable sales again up by 8.6%.

Costco continues to execute its expansion strategy, with plans to open up to 28 new warehouses in fiscal year 2025, including several openings in California this week. These new locations underscore the company’s commitment to expanding its footprint globally, contributing to its sales growth trajectory.