Rupesh Parikh

Management attributed the upside to broad-based strength led by THERABREATH and cat litter, with ARM & HAMMER laundry flattish and international strong at 9%.

CFO confirmed segment outlook unchanged from January: U.S. ~3%, International ~7% (slightly softer due to Middle East), SPD ~5%. Maintaining 3-4% total organic range.

CEO highlighted value-seeking behavior benefiting ARM & HAMMER: hitting all-time share highs while promoting less. All 3 competitors promoting more. Value segment growing in both laundry and litter.

Management confirmed launching as fast as possible with regulatory challenges for alcohol-based product. Started with Sephora in Canada and Middle East, handful more markets this year.

CFO confirmed M&A remains #1 priority. Took advantage of stock pullback with $600M YTD buybacks. Balance sheet recently upgraded, strong cash flow gives optionality for both.

CEO cited recent Argentina trip with 300+ people, strong excitement for brands. THERABREATH, HERO, TOUCHLAND driving growth even as GDP slows in some markets.

CEO noted Touchland driving half of category growth with 6% household penetration vs 37% category. Body mist off to good start, international expanding.

CEO quantified destocking at ~100bps in Q2 (down from 300bps in Q1), expects slight impacts going forward but not material. Channel mix shift reducing system inventory needs.

CFO provided clear segment breakdown: international organic ~6%, SPD ~3%, domestic negative 3% in Q1 with similar expected in Q2.

CEO provided data showing promotions stable in laundry (34% sold on deal) and litter (17.8%). Expects category growth assumption now 1.5% vs prior 2.5%.

Dierker acknowledged vitamin business likely to decline a little bit for a little longer but expects innovation pipeline (renovated formulas, Power Plus, sugar-free variants) to create an inflection point.

Dierker highlighted unprecedented speed of HERO international rollout. Farrell added that markets entered are already reaching number 1 in patches and in some cases total acne, with consumption exceeding expectations before NPD launches.

Mike said moving from roughly half to about a third of stores in the opportunity bucket is progress, not the finish line; the harder challenge is sustaining elevated gold standards across 9,500 stores, which he tied to a culture of accountability driving traffic and productivity.

Stewart separated the tariff reinvestment ($210M full year, back-half weighted) from the underlying business, guided gross margin flattish in Q3 and down in Q4 on higher freight/fuel and broad-based inflation, and noted less shrink benefit in the back half; SG&A cycles last year red-stickering (~$33M/quarter).

Mike framed it as <5% of assortment to bring back lost brands at $1.50; Stewart detailed rigorous competitor benchmarking showing positive relative value.

Stewart pointed to lapping last year's restickering for absolute back-half leverage, plus improving cost discipline and labor productivity.

Creedon noted higher gas prices drive accelerated trade-in from middle/higher income households while core customers rely on Dollar Tree pack sizes to stretch budgets. Glendinning outlined short-term tariff/diesel offset dynamic and commitment to managing to a margin.

Glendinning attributed Q4 gross margin to lower freight, sourcing improvements from merchant teams, favorable multi-price mix, and strong supply chain productivity. SG&A deleverage from same factors as prior quarters: stickering costs plus higher insurance and general liability.

Creedon characterized elasticity as very manageable, offset by multi-price mix. Compared favorably to break-the-dollar period, noting more strategic approach this time. Deferred on tariff speculation pending Supreme Court.

Creedon indicated core pricing actions are complete with remaining work on restickering as replenishment and packaway flows through. Customer response to pricing has been positive based on traffic and ticket trends.

Glendinning defended maintaining 3-5% full-year range despite strong Q1 beat, noting they wanted to pair Q2 cost disclosure with confidence in underlying business strength.

Creedon highlighted every conversion cohort strengthened Q4 vs Q3 and identified store readiness and operational execution as biggest improvement areas for 2025 conversions.

Jeff reflected on realistic algorithm-based planning, bottom-line levers (pricing, mix, SG&A), centralization benefits and portfolio moves.

Ghingo detailed retail pricing benefit, mix, and manufacturing gains, while flagging continued freight and commodity pressure into H2.

John reiterated segment guide from November: Retail expects modest volume declines from private label nuts exit and pricing elasticities, with net sales in low single digits to flat for the full year.

Jeff cited five drivers: pricing action benefits, continued T&M benefits, ongoing SG&A savings, modest commodity market improvements in H2, and lapping Q4 one-time discrete events from prior year. Pleased Q1 came in $0.02 ahead of initial expectations. Confirmation of guidance amid logistics headwinds seen as prudent yet confident signal.

John described strained consumer with some trading down, but growth coming from solutions and value broadly defined. Cited Applegate premium growth, Mexican portfolio flavor/convenience, and Jennie-O lean protein demand. Jim added Retail holding market share, Foodservice structured to outperform.

Jim confirmed nothing has changed in FY26 $250M outlook. Focus remains on FY25 execution. Excited about T&M financial benefits and long-term capabilities being built.

Gross margins pressured by turkey and nuts in Q2 but improving sequentially. Jim expressed confidence portfolio can exceed historical margin levels over time.

John highlighted three observations: impressive internal transformation; retail momentum with flagship brands growing consumption; and unique protein-anchored portfolio as competitive advantage.

Jim Snee outlined key growth drivers: retail categories, Foodservice, International, T&M acceleration. Jacinth added higher volume and better mix could drive to high end.

David said opening more stores, 12 major projects this quarter, is a clear strategy in high-growth and existing geographies, with M&A evaluated on disciplined returns.

David quantified the IRA headwind at ~130bps (profit-neutral) and the brand-to-generic shift at ~40bps (profit-positive), and noted core scripts and GLP-1 share gains keep pharmacy healthy.

Ron said total CapEx unchanged, mix is shifting from fulfillment centers to store expansion, improving ROIC. Capital reallocation rather than incremental spend.

David confirmed slight acceleration in retail media this quarter vs last. Attributed to strong closed-loop measurement capability and differentiated offering. Tweaking client engagement approach for continued growth.

David noted first half had easiest YoY comparisons; back half gets tougher. Updated guidance reflects this. But two-year stacks expected to continue improving. Ron credited simpler promotions, lower prices, and better execution.

David confirmed ESI had less than 10bps impact in Q1 and is not built into full-year guidance due to timing uncertainty of large commercial contracts coming back on stream. Said they are on track.

Todd highlighted limited China exposure at single-digit levels. Fresh produce from Mexico/Canada is mid-single-digit. Sourcing teams proactively diversifying suppliers to mitigate any impact.

Rupesh probed the narrowing of OP guidance. Todd explained with one quarter left they wanted less variability in expectations, with sales guidance consistent with full-year thinking.

Rupesh asked about Boost membership traction after Disney perk addition. Rodney said they are very happy but more excited about the potential, citing high renewal rates and NPS scores.

Gave an encouraged headline then handed to Cara for color rather than specific numbers.

Michael framed traffic as the top indicator of sustainable growth and passed to Cara for category detail.

Fiddelke highlighted success of Roller Rabbit, Parke, and Pokemon drops with strong partnership pipeline ahead. Sylvester added K-Pop BTS launch as fourth line-drawing event, emphasizing increasing cadence of partnerships.

Fiddelke noted 10-year growth streak in beauty and ambition to be an incredible beauty destination; said more details to come closer to back-half launch. Did not directly address vendor interest specifics.

Fiddelke acknowledges execution risk, most store change in a decade means bumpier in-stock moments, but believes the upside of aggressive change outweighs the risk. Cara adds that execution is her top 3 priority with extra teams focused on it.

Fiddelke explains the Chicago market test as a way to optimize labor without incremental investment: specializing store roles for fulfillment vs. in-store experience.

Jim notes Q2 reinforces confidence in the range but maintains a cautious approach given continued tariff and consumer uncertainty.

Management emphasizes retail fundamentals: in-stock reliability, newness, value, and great in-store experiences as traffic drivers.

Rick highlighted bright spots in apparel (all in motion, women’s), home (Hearth & Hand up ~40%), and noted 600 bps improvement when weather broke. Brian cautioned they will plan cautiously for 2025 and not get ahead of the consumer. No specific 2025 guidance given.

Gary said AI-search-originated sales are growing triple digits off a low base with the highest conversion rate of any channel, noting Costco does no paid digital advertising.

Gary said the AI-search benefit is broad but early; Ron cited appliances and tires, where all-in pricing (delivery, installation) now surfaces in AI results.

Gary flagged 7.5% underlying fee income growth and 9% upgrade growth from the $10 Instacart credit and extended hours as positives, and attributed the 4.8% total paid member growth to fewer new-market openings, lapping strong sign-ups and normalization back toward a long-term ~5% rate.

Gary said healthcare costs growing faster than sales was new in the quarter, the ~4bp tax assessment was one-time, and SG&A would have levered mid-single digits absent those items with productivity offsetting wage and extended-hour investments.

Gary confirmed extended hours are a net benefit with minimal SG&A headwind, and described alternative revenue as multi-pronged across credit card, Affirm BNPL, travel, and the media build-out with Kimberly-Clark as an early proof point.

Gary flagged the core-on-core drivers as somewhat quarter-specific (dairy, butter, egg deflation) and said tariff rollback impact is difficult to predict.

Gary clarified the net wage headwind is mid-single-digit basis points after lapping, plus a Q3 vacation accrual catch-up.

Gary broke down puts and takes: gas was biggest headwind from Middle East cycling, offset by e-commerce margin improvement, mix benefit, and co-brand credit card program favorability.