MW Higher gas prices are driving people to membership retailers - and Costco is the latest to benefit

By Bill Peters

Costco's same-store sales rose 9.8% during its third quarter, well above Wall Street's estimates, as gasoline sales provided a nice bump

Drivers wait in their vehicles to pump gasoline at a Costco gas station in Hawthorne, Calif., on March 18.

Costco Wholesale may have benefited from shoppers looking for a break from higher gas prices, but its third-quarter results overall on Thursday were mixed, leading to muted trading after hours.

As the Iran war drives gas prices higher, some analysts have said more consumers could seek discounts at club chains like Costco $(COST)$, the Walmart-owned $(WMT)$ Sam's Club and BJ's Wholesale Club $(BJ)$, all of which run a lot of gas stations. Costco and Walmart have benefited more broadly from the cost-of-living squeeze over the past several years, as consumers of all income levels seek discounts and membership perks.

Costco's sales were up 11.6% year over year to $70.52 billion during its third quarter, which ended on May 10. The company earned $4.93 a share during the quarter. Factoring out fluctuations in gas prices and foreign exchange, Costco's same-store sales rose 6.6%.

Analysts expected Costco to report earnings of $4.98 for its third quarter on revenue of $69.68 billion, while forecasting a 7.8% same-store sales gain.

Factoring in the impact of gas prices, same-store sales rose 9.8%.

Costco shares inched up 0.3% in after-hours trading Thursday, at last check. The stock has lost 9.1% since it closed at a record high of $1,094.32 on May 19, but it has gained 15.4% in 2026 through Thursday's close.

Walmart last week said people were putting fewer gallons in their gas tanks, with the average fill-up slipping below 10 gallons for the first time since 2022, when Russia's invasion of Ukraine sent energy costs higher. Walmart management said such behavior was an indication of deeper stress among consumers, adding that prices at its stores could rise if fuel prices remain high. National average gas prices stood at around $4.43 per gallon Thursday, according to AAA.

BJ's CEO Bob Eddy also said that his company's customers were putting less in the tank - a byproduct of higher prices and more members topping off tanks more often. The chain said its members spent $143 million more on gasoline than they did a year ago amid the spike in oil prices.

Oppenheimer analysts, in a note this month, noted that Costco's stock has fallen after four out of its last eight quarterly earnings reports. But they said any postearnings drop represented a chance to buy the dip.

UBS analyst Michael Lasser, in a separate note this month, said that higher gas prices appeared to draw more consumers to Costco in April, when it put up an 11.6% monthly same-store sales gain. He also said those sales gains were driven by a 4.2% increase in consumer foot traffic, following weaker trends in March.

"[Costco] can navigate continued uncertainty like it did in April, and if the environment eases, we think it can take advantage," Lasser said.

-Bill Peters

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May 28, 2026 17:06 ET (21:06 GMT)

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