Costco vs Walmart: Revenue, Profitability & Business Model Compared
Side-by-side comparison of Costco (COST) and Walmart (WMT). Compare revenue breakdowns, profitability, financial metrics, and retail business models.
Costco vs Walmart Overview
Two retail giants with contrasting models: Costco focuses on membership-based warehouse clubs with limited SKUs and premium wages, while Walmart dominates through everyday low prices and massive scale.
| Metric | Costco (COST) | Walmart (WMT) |
|---|---|---|
| Sector | Retail | Retail |
| Market Cap | $420B | $685B |
| Revenue | $254.5B | $681.0B |
| Net Income | $7.4B | $15.5B |
How Does Costco Make Money?
Costco (COST) operates in the Retail sector with a market cap of $420B. For a full breakdown of Costco’s revenue sources, see the Costco revenue breakdown.
Costco Revenue Breakdown
| Segment | FY2024 (Aug) | FY2023 (Aug) | YoY Growth |
|---|---|---|---|
| Net Sales | $249.6B | $237.7B | +5.0% |
| Membership Fees | $4.9B | $4.6B | +6.5% |
| Total Revenue | $254.5B | $242.3B | +5.0% |
Costco Sales by Category
| Category | % of Sales |
|---|---|
| Foods & Sundries | 40% |
| Non-Foods | 28% |
| Fresh Foods | 13% |
| Hardlines | 7% |
| Softlines | 6% |
| Ancillary & Other | 6% |
How Does Walmart Make Money?
Walmart (WMT) operates in the Retail sector with a market cap of $685B. For a full breakdown of Walmart’s revenue sources, see the Walmart revenue breakdown.
Walmart Revenue Breakdown
| Segment | FY2025 (Jan) | FY2024 (Jan) | YoY Growth |
|---|---|---|---|
| Walmart U.S. | $462.5B | $441.8B | +4.7% |
| Walmart International | $121.4B | $114.6B | +5.9% |
| Sam’s Club U.S. | $86.2B | $84.3B | +2.3% |
| Other | $10.9B | $10.7B | +1.9% |
| Total Revenue | $681.0B | $648.1B | +5.1% |
Costco vs Walmart Profitability
Costco: Yes, Costco is profitable. The company reported net income of $7.4B on total revenue of $254.5B. With an operating margin of 3.6%, Costco runs intentionally thin margins to deliver value to members.
Walmart: Yes, Walmart is profitable. The company reported net income of $15.5B on total revenue of $681.0B. With an operating margin of 4.2%, Walmart generates strong profits through massive scale.
Key Financial Metrics Comparison
Costco Key Metrics
- Gross Margin: 12.5% — Intentionally low to pass savings to members.
- Operating Margin: 3.6% — Membership fees drive nearly all profit.
- Membership Renewal Rate: 93% — Exceptional loyalty and sticky revenue.
- Revenue per Member: $3,500+ — High-spending affluent customer base.
Walmart Key Metrics
- Gross Margin: 24.5% — Higher margin reflecting broader merchandise mix.
- Operating Margin: 4.2% — Scale-driven profitability.
- U.S. E-commerce Growth: +23% — Digital transformation accelerating.
- Store Count: 10,500+ — Largest retailer globally by locations.
Which Company is a Better Investment?
Costco offers a defensible membership model with loyal customers and consistent execution, though it trades at a premium valuation. Walmart provides unmatched scale, growing e-commerce business, and improving margins. Consider each company’s competitive moat and exposure to consumer spending trends. Review the full Costco revenue breakdown and Walmart revenue breakdown for detailed analysis.
Disclaimer: This comparison is for informational purposes only and does not constitute investment advice.