What are the top risks for COSTCO WHOLESALE CORP /NEW (COST)?

The top risks identified in the 10-Q filing are: Competitive Pressures and Technological Adoption, Cybersecurity Threats and Data Privacy, Supply Chain Disruptions and Supplier Reliability. The company faces a high-risk profile due to intense competition, significant cybersecurity threats, and supply chain vulnerabilities. Evolving regulations and geopolitical factors add further complexity.

COST - Comprehensive Filing Intelligence

Q4 2026•10-Q•Filed Dec 17, 2025

6.0/10

Filing Health:GOOD

Solid fundamentals with minor concerns to monitor

Executive Summary

Costco reported strong top-line growth driven by comparable sales, new warehouses, and membership growth, with net sales up 8%.. Gross margins slightly improved year-over-year, driven by ancillary businesses, despite a smaller LIFO benefit.. No significant off-balance sheet exposures like cloud commitments, purchase obligations, or VIEs were detailed in the provided sections, indicating a potentially low risk in these areas.. Net sales increased 8% year-over-year.

Top Concerns

!Change in e-commerce comparable sales metric definition
!No significant off-balance sheet exposures like cloud commitments, purchase obligations, or VIEs were detailed in the provided sections, indicating a potentially low risk in these areas.
!Competitive Pressures and Technological Adoption (high)
!Cybersecurity Threats and Data Privacy (high)

Top Positives

+Costco reported strong top-line growth driven by comparable sales, new warehouses, and membership growth, with net sales up 8%.

Analysis Dimensions

Our 5-pass AI analysis examines this filing across multiple dimensions. Each dimension score is derived from direct analysis of SEC filing text.

Narrative Intelligence

7.0/10

Management tone is confidently optimistic with focus on increase in warehouse ancillary and other businesses, primarily pharmacy and hearing aids.

Full analysis includes: tone changes vs prior quarter, margin driver breakdown, forward guidance analysis, strategic priorities.

Accounting Quality

8.0/10

Earnings quality shows moderate accounting practices.

Full analysis includes: reserve and allowance changes, non-recurring item analysis, stock-based compensation impact, disclosure concerns.

Hidden Liabilities

Off-balance sheet risk is low.

Full analysis includes: cloud and purchase commitments, VIE/SPE exposure, covenant compliance status, refinancing risk assessment.

Risk Landscape

3.0/10

Overall risk profile shows competitive pressures and technological adoption as primary concern.

Full analysis includes: 8 risk categories with severity, new vs escalated risks, management response assessment, risk trend analysis.

Segment Performance

7.0/10

Segment health analysis.

Full analysis includes: segment-by-segment revenue breakdown, geographic concentration risk, customer concentration analysis, segment margin trends.