COST · Forward model · Membership fees · Bear case
What has to happen in Membership fees
Model as of
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Membership fees
Basis quarter$1.37B
Final quarter$1.85B
Implied CAGR+6%
Final revenue mix2%
A recurring annual fee recognised ratably over the twelve-month term, from a paid base that renews at 92.2% in the U.S. and Canada and 89.7% worldwide. Revenue is paid members times the blended annual fee. It is about 2% of revenue and, on the flow-through convention this model uses, roughly 40% of EBITDA - which is why the valuation is far more sensitive to this line than its size suggests.
Last four quarters
2025 Q4
$1.72B
Reported
2026 Q1
$1.33B
Reported
2026 Q2
$1.35B
Reported
2026 Q3
$1.37B
Reported
Gold Star (individual)Business and business affiliatesExecutive upgrade
Subscribers
82.9M
55.8% of a 148.5M addressable base
82.9m paid members at 10 May 2026, from the 10-Q membership table; the CFO gave the same figure, up 4.1%.
Addressable subscribers
148.5M
the S-curve ceiling
148.5m total cardholders, disclosed in the same table. Paid members are 55.8% of them.
Net adds
0/qtr
ramping toward 0/qtr, throttled as the base approaches the TAM
Net-add ceiling
0/qtr
what supply can deliver at full rate
ARPU
$5.98/mo
drifting +0.9% per quarter, floor $0.00
$5.98/month is the derived $71.81 blended annual fee: deseasonalised fees of $1,488m annualised over 82.9m members.
Non-subscriber revenue
$0/qtr
growing 0.0% per quarter
Zero. Membership fees are a single disclosed income-statement line with no other component.
Membership fees
Latest: $1.85B (2031Q3E)
| Period | Value |
|---|---|
| 2022Q1 | $946M |
| 2022Q2 | $967M |
| 2022Q3 | $984M |
| 2022Q4 | $1.33B |
| 2023Q1 | $1.00B |
| 2023Q2 | $1.03B |
| 2023Q3 | $1.04B |
| 2023Q4 | $1.51B |
| 2024Q1 | $1.08B |
| 2024Q2 | $1.11B |
| 2024Q3 | $1.12B |
| 2024Q4 | $1.51B |
| 2025Q1 | $1.17B |
| 2025Q2 | $1.19B |
| 2025Q3 | $1.24B |
| 2025Q4 | $1.72B |
| 2026Q1 | $1.33B |
| 2026Q2 | $1.35B |
| 2026Q3 | $1.37B |
| 2026Q4E | $1.86B |
| 2027Q1E | $1.42B |
| 2027Q2E | $1.43B |
| 2027Q3E | $1.46B |
| 2027Q4E | $1.98B |
| 2028Q1E | $1.50B |
| 2028Q2E | $1.52B |
| 2028Q3E | $1.55B |
| 2028Q4E | $2.10B |
| 2029Q1E | $1.60B |
| 2029Q2E | $1.61B |
| 2029Q3E | $1.64B |
| 2029Q4E | $2.23B |
| 2030Q1E | $1.69B |
| 2030Q2E | $1.71B |
| 2030Q3E | $1.74B |
| 2030Q4E | $2.36B |
| 2031Q1E | $1.79B |
| 2031Q2E | $1.81B |
| 2031Q3E | $1.85B |
Assumptions & reasoning
- The 100% flow-through is a convention, not a disclosure. Fee revenue carries no merchandise cost, and the member-service labour that supports it sits inside warehouse SG&A, which Costco does not allocate. This convention and the 2.949% residual on net sales are two halves of one choice: together they reproduce consolidated EBITDA of $3,412m exactly.
- Capex is zero here by construction. Every dollar of property, plant and equipment is carried on the net-sales vertical, so the two lines do not double-count the warehouse estate the fee base depends on.
- The base case does NOT assume another fee increase. The September 2024 increase to $65 Gold Star and $130 Executive was about 25% of membership-fee growth in the quarter, down from 35% year to date, and the company says it laps out. Stripping it leaves 3.8% a year of fee-per-member growth, which is what the ARPU drift carries. The trailing deseasonalised rate of 2.54% a quarter is not carried forward because a quarter of it is about to disappear.
- Both renewal rates fell year on year - U.S. and Canada from 92.7% to 92.2%, worldwide from 90.2% to 89.7% - which the company attributes to memberships sold online and through digital promotions entering the calculation. That risk is expressed in the bear case, not in the base attach glide.