Oliver Chen

Gary (responding to Gabriella Garr on for Oliver Chen) described resilient members spending on both everyday value and discretionary items, citing over 50% growth in some self-care items.

Gary said retail media runs through the member-experience lens with most value reinvested in members; Ron called the tech spend capital-light with strong returns.

Gary said media revenue is growing double digits with 1,000+ participating suppliers, retail media is still early innings behind personalization builds, and AI focus is squarely on making Costco better for members and employees rather than chasing non-core use cases.

Gary framed retail media as still early innings with media revenue a tailwind in the quarter, and Ron said AI is in a two-phase rollout (member-facing and business basics) with procurement and supply chain as high-value use cases.

Gary said targeted and relevant personal messaging is the highest priority in the digital roadmap, and KS focus remains on filling quality/value gaps with no specific penetration target.

Gary described CE as flat overall but COST gaining share, and pointed to big TVs driving holiday excitement.

Gary noted items per basket turned positive at ~2% adjusted. Retail media seen as incremental opportunity tapping marketing agency budgets, not cannibalizing existing business.

Kecia highlighted SKU rationalization to make room for K-Beauty and wellness. Focused on brand authenticity and efficacy. Marketplace serves as complementary mezzanine assortment. Chris noted gross margin planned flat with merchandise margin opportunity offset by fixed cost deleverage. New smaller store formats (25% of FY2025, 15% of FY2026) help manage fixed costs.

Kecia emphasized curated, invitation-only approach. Members earn points. Returns through stores. Expects margin accretion and low-risk category expansion. Monitoring TikTok opportunities.

Kimbell pointed back to Investor Day four pillars: assortment, experience, availability, and loyalty. Oyibo clarified October softness was not surprising, partly driven by tent-pole event timing shifts.

Guggina explained Sparky usage expanding from GM discovery to everyday essentials like food and consumables via personalized replenishment and meal planning. Units through Sparky grew 4x quarter-over-quarter.

Furner said omni strategy built on channel flexibility meeting new customers and growing with customers not previously transacted with. All pieces working together driving faster delivery and more intuitive experiences. Sparky engagement growing Q4 over Q3 with about half of customers engaging. 27% e-commerce growth in Q4 and 24% globally. Sparky helps understand what customers are trying to accomplish whether birthday party camping trip or meal planning. Express delivery averaging under an hour. Total fast delivery under 3 hours grew 60% year-on-year. Confident in strategy and assets with continued disciplined capital investment.

McMillon said advantages include massive data across product catalog delivery and real-time. Physical supply chain and customer service culture are differentiators that not many can replicate. Ability to know customer intent and fulfill across breadth of assortment. Furner excited about understanding customer intent at one-to-one level with memory to anticipate needs. Sparky capabilities expanding near future. Nicholas said Sam's seeing well over 40% scan-and-go usage at weekends trending younger with new members. McLay added trust is competitive advantage transferring to AI world. On higher income Furner said flexibility of marketplace with over half a billion items and faster delivery speeds resonating. Fashion accelerating. Growth balanced across all income groups with higher income customers transacting more frequently.

Near-term priority is balance sheet deleveraging. Will evaluate M&A opportunities that are complementary to portfolio but capital discipline comes first.

Stéphane highlighted rising middle class, distribution expansion, and consumer connectivity. Akhil outlined margin recovery path: gross margin improvement, doubled restructuring, procurement step-change, and shared services expansion.

Fiddelke highlights two near-term AI applications: guest-facing personalization (app offers, search) and team-facing efficiency (freeing store team minutes from tasks like truck unloading to redirect to guest service). Jim says low to mid-single-digit sales growth over time drives leverage, with productivity as an additional offset.