The retailer's total sales and revenue reached new highs in its fiscal Q4 and year, with ecommerce growing at a faster rate than total comparable sales.

Costco Wholesale Corp. announced ecommerce sales growth for its fiscal Q4 and year that ended Sept. 1.

In both Costco’s Q4 and full fiscal year 2024, its ecommerce sales grew at more than triple the pace of total comparable sales. Total company comparable sales grew 5.4% in Q4 and 5.3% for the full fiscal year.



GreyBar_Articles

Non-food items had the highest comparable sales growth in the quarter, according to Gary Millerchip, executive vice president and chief financial officer.

“Our buyers have done a fantastic job finding new and exciting items at great values,” he told investors on the retailer’s Q4 earnings call.

Gold jewelry, gift cards, toys and seasonal items, home furnishings, tires and housewares all grew comparable sales in the double digits during the quarter, Millerchip said.

Costco opened 30 new warehouses in its fiscal 2024. That includes one relocation and 29 entirely new Costco locations — including its first in Maine. Of the 30, 14 were in Q4. The retailer now has physical locations in 47 states and marked its 600th U.S. building in Wisconsin. CEO Ron Vachris told investors on the earnings call that Costco plans to open 12 of its 29 new locations in fiscal 2025 outside the U.S.

Costco net sales in Q4 grew to $78.2 billion. That’s a 1% increase from $77.4 billion in the prior-year’s fourth quarter. It’s also the highest quarterly sales amount Costco has recorded to date.

Additionally, its full-fiscal-year sales grew to $249.6 billion. That’s up 5% from $237.7 billion for Costco’s fiscal 2023.

Costco is No. 7 in the Top 1000 Database. The database is Digital Commerce 360’s ranking of the largest online retailers in North America. It’s also the fourth-largest Mass Merchant in the database.

Costco ecommerce sales climb in Q4

In Q4, Costco ecommerce sales grew 18.9% year over year. That outpaces not just Costco’s total company comparable sales growth but also full-year ecommerce growth of 16.1%. And in Q3, Costco ecommerce sales had grown 20.7% year over year, meaning growth was stronger in the back half of the year than the front.

Vachris said Costco improved its item assortment, delivery times and scheduling functionality.

In fiscal 2024, Costco Logistics delivered more than 4.5 million items, which is up 29% from the prior year. Appliances and furniture led Costco ecommerce growth in fiscal 2024, Vachris told investors.

“We have great momentum with this business and expect big and bulky items will be a key part of our continued progress with ecommerce in the coming year,” Vachris said.

He added that the benefits of Costco’s digital transformation have begun to come to fruition in the fiscal year. The retailer’s members “are very excited” about being able to check warehouse inventory via the Costco app, he said. Additionally, membership card scanners at the front doors have helped Costco speed up its in-store checkout process.

Health and beauty products sold well online and in store, Millerchip said.

Fresh-food products saw high-single-digit growth, he added. Costco lowered the price of its Kirkland-brand boneless chicken tenderloins 13%, and it saw a 21% lift in pounds sold, according to Millerchip.

Shopping trends at Costco

Millerchip said traffic (shopping frequency) increased in Q4. Traffic grew 5.6% in the U.S. and 6.4% worldwide, he said. Meanwhile, average order value decreased 0.3% in the U.S. and 0.9% worldwide. Adjusting for gas deflation and foreign exchange (FX) of currency, he said, the average Costco transaction grew 0.6% in the U.S. and 0.5% globally.

Costco ecommerce benefited from “strong sales growth, item mix and fulfillment productivity,” Millerchip stated. Costco ecommerce traffic, conversion rates and average order value all grew year over year, he said. The retailer also finished its rollout of buy online, pick up in warehouse for televisions in the United States.

“This allows same-day pickup of a new TV for members who prefer not to wait for delivery,” Millerchip said. “While buy online, pick up in warehouse isn’t cost effective for us on lower-priced items, for high-value items with high shipping costs like TVs, the freight savings more than offset the added labor required in warehouses to fulfill those orders. We’re now testing a similar program on laptops.”

Consumers downloaded the Costco mobile app 3.5 million times in the quarter, bringing total downloads to 39 million. Costco also upgraded the native search function on its U.S. mobile app. That doubled the click-through rate on search results, Millerchip said.

Costco Next, the retailer’s marketplace, added 11 new vendors, bringing its total to 86. Additionally, Costco Next grew sales nearly 40% year over year, Millerchip said.

How many members does Costco have?

Excluding the impacts from an extra week in its fiscal 2024, Costco income from membership fees grew 7.4%, Millerchip noted. Membership renewal rates decreased 0.1% quarter over quarter in Q4, to 92.9%, as Costco offered an online membership promotion in fiscal 2023 that resulted in more than 200,000 new signups, he added. There were no meaningful changes in the U.S. renewal rate aside from that, he said, and the worldwide rate was 90.5% in Q4 — the same as in Q3.

Costco ended Q4 with 76.2 million paid household members, up 7.3% year over year. It also ended the quarter with 136.8 million cardholders, a 7% year over year. And about half of new member signups in fiscal 2024 were under 40 years old, he said.

The percentage of younger shoppers has been growing since the outbreak of the COVID-19 pandemic, he explained, and has lowered the average age of Costco members over the last few years.

Also at the end of Q4, Costco had 35.4 million paid executive memberships, which is up 9.6% year over year. Executive members represent 46.5% of paid members and about three-quarters (73.5%) of worldwide sales, Millerchip said.

How many countries have a Costco?

As of the end of its fiscal Q4 2024, Costco operates 891 warehouses. Of those, 614 are in the United States and Puerto Rico. Listed by amount, the rest are in:

  • Canada (108)
  • Mexico (40)
  • Japan (35)
  • The United Kingdom (29)
  • South Korea (19)
  • Australia (15)
  • Taiwan (14)
  • China (7)
  • Spain (5)
  • France (2)
  • Iceland (1)
  • New Zealand (1)
  • Sweden (1)

In Q4, Costco opened 10 locations in the United States, two in Japan, and one each in South Korea and China.

Costco operates ecommerce sites in:

  • Australia
  • Canada
  • Japan
  • Mexico
  • South Korea
  • Taiwan
  • The United States
  • The United Kingdom

Costco earnings

For its fiscal Q4 ended Sept. 1, 2024, Costco reported:

  • Net sales in Q4 grew to $78.2 billion. That’s up 1% from $77.4 billion the prior year.
  • Costco’s net income increased to $2.35 billion. That’s up 9% year over year from $2.16 billion.
  • Costco ecommerce sales increased 18.9% year over year.

For its fiscal 2024 ended Sept. 1, 2024, Costco reported:

  • Costco net sales for the full fiscal year grew to $249.6 billion. That’s up 5% from $237.7 billion the year before.
  • Net income grew to $7.37 billion. That’s up from $6.29 billion the prior year.
  • Costco ecommerce sales increased 16.1% year over year.

Percentage changes may not align exactly with dollar figures due to rounding. Check back for more earnings reports. Here’s last quarter’s update on Costco ecommerce sales.

Do you rank in our databases? 

Submit your data and we’ll see where you fit in our next ranking update.

Sign up

Stay on top of the latest developments in the online retail industry. Sign up for a complimentary subscription to Digital Commerce 360 Retail News. Follow us on LinkedIn, X (formerly Twitter), Facebook and YouTube. Be the first to know when Digital Commerce 360 publishes news content.