Costco Wholesale Corporation stock research
FY2023 Q3
Costco Wholesale (COST) Gross Margin — Quarter Ended May 7, 2023
Revenue declined from both the previous quarter and the prior-year quarter, while gross profit decreased compared to the previous quarter but increased versus the prior-year period. The gross margin weakened from the preceding quarter but improved relative to the same quarter one year earlier, reflecting a mixed sequential and year-over-year performance.
Gross margin takeaway
Quarter ended May 7, 2023 · FY2023 Q3
Revenue declined from both the previous quarter and the prior-year quarter, while gross profit decreased compared to the previous quarter but increased versus the prior-year period. The gross margin weakened from the preceding quarter but improved relative to the same quarter one year earlier, reflecting a mixed sequential and year-over-year performance.
- Cost of revenue decreased from the prior quarter but increased from the same quarter last year, while revenue moved in similar proportions. The resulting gross margin change was driven by cost of revenue changing at a slightly different rate than revenue in both comparisons.
- Compared to the immediately preceding quarter, both revenue and gross profit were lower, and gross margin weakened slightly. Versus the same quarter one year earlier, revenue was higher, gross profit was higher, and gross margin improved moderately.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
12.1%
Gross profit
$6.5B
Revenue
$53.6B
Cost of revenue
$47.2B
Quarter-over-quarter change
-0.3 pts
Year-over-year change
+0.2 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Feb 12, 2023 | $55.3B | $6.8B | $48.4B | 12.4% |
| May 7, 2023 | $53.6B | $6.5B | $47.2B | 12.1% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Feb 12, 2023
-0.3 pts
Year-over-year change
May 8, 2022
+0.2 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
Cost of revenue decreased from the prior quarter but increased from the same quarter last year, while revenue moved in similar proportions. The resulting gross margin change was driven by cost of revenue changing at a slightly different rate than revenue in both comparisons.
Compared to the immediately preceding quarter, both revenue and gross profit were lower, and gross margin weakened slightly. Versus the same quarter one year earlier, revenue was higher, gross profit was higher, and gross margin improved moderately.
Monitor whether cost of revenue continues to change at a rate different from revenue, as that pattern directly influences gross margin direction.