BJ’s Wholesale Club delivered steady results in Q3, meeting Wall Street’s revenue expectations and surpassing consensus non-GAAP profit estimates. Management attributed performance to continued traffic gains, with CEO Robert W. Eddy highlighting “the twelfth consecutive quarter of market share growth and the fifteenth consecutive quarter of traffic growth.” The company cited strong performance in perishables—particularly fresh meat, dairy, and produce—supported by its Fresh 2.0 initiative. Value-seeking behavior among members, such as increased purchases of private label items, remained a consistent theme as consumers navigated a challenging economic environment marked by low confidence and cautious spending.
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BJ's (BJ) Q3 CY2025 Highlights:
- Revenue: $5.35 billion vs analyst estimates of $5.35 billion (4.9% year-on-year growth, in line)
- Adjusted EPS: $1.16 vs analyst estimates of $1.09 (6.3% beat)
- Adjusted EBITDA: $292.2 million vs analyst estimates of $294.5 million (5.5% margin, 0.8% miss)
- Management raised its full-year Adjusted EPS guidance to $4.35 at the midpoint, a 1.8% increase
- Operating Margin: 4.1%, in line with the same quarter last year
- Locations: 256 at quarter end, up from 247 in the same quarter last year
- Same-Store Sales rose 1.1% year on year, in line with the same quarter last year
- Market Capitalization: $11.88 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From BJ's’s Q3 Earnings Call
- Peter Sloan Benedict (Baird) asked about membership trends among lower-income cohorts and SNAP program exposure. CEO Robert W. Eddy said performance was “resilient,” with purchasing habits stable and SNAP participants returning after temporary disruption.
- Katharine Amanda McShane (Goldman Sachs) questioned long-term same-store sales growth targets. Eddy emphasized ongoing transformation through membership, merchandising, digital, and real estate, noting that external factors and competition remain challenges.
- Robby Ohmes (Bank of America) inquired about inventory positioning and the evolution of Fresh 2.0 benefits. Eddy highlighted proactive inventory management to support member value, while CFO Laura L. Felice discussed further improvements in fresh categories like meat and seafood.
- Steven Emanuel Zaccone (Citi) pressed for details on holiday season assumptions and general merchandise inventory planning for the next year. Management cited cautious optimism and noted tighter buys and selective assortments to support seasonal demand.
- Pedro Gill (Morgan Stanley) sought updates on digital business and AI adoption. Eddy described growth in digital sales and retail media, as well as expanded use of AI for store operations and customer experience enhancements.
Catalysts in Upcoming Quarters
In the coming quarters, we will monitor (1) the pace of new club openings and their performance relative to membership targets, (2) the impact of digital and AI investments on member engagement and operational efficiency, and (3) the evolution of value-seeking behavior among members, especially in light of external cost pressures and fluctuating consumer confidence. Progress on general merchandise revitalization and success in new markets will also be key signposts.
BJ's currently trades at $90.50, in line with $90.59 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free for active Edge members).
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