BJ's Wholesale Club Holdings, Inc. 10-Q

Item 1. Financial Statements. BJ’S WHOLESALE CLUB HOLDINGS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Amounts in thousands, except par value) (Unaudited) May 2, 2026 January 31, 2026 May 3, 2025 ASSETS Current assets: Cash and cash equivalents $ 27,826 $ 46,245 $ 39,484 Accounts receivable, net 319,936 252,789 240,419 Merchandise inventories 1,668,263 1,555,471 1,567,032 Prepaid expenses and other current assets 198,876 135,584 81,833 Total current assets 2,214,901 1,990,089 1,928,768 Operating lease right-of-use assets, net 2,004,451 1,976,013 2,065,890 Property and equipment, net 2,534,420 2,364,552 1,988,290 Goodwill 1,008,816 1,008,816 1,008,816 Intangibles, net 94,239 95,462 99,697 Deferred income taxes 4,593 4,427 7,615 Other assets 67,578 71,116 58,596 Total assets $ 7,928,998 $ 7,510,475 $ 7,157,672 LIABILITIES Current liabilities: Short-term debt $ 375,000 $ 120,000 $ 150,000 Current portion of operating lease liabilities 181,994 209,249 169,568 Accounts payable 1,438,931 1,307,405 1,255,867 Accrued expenses and other current liabilities 1,048,934 1,033,579 934,974 Total current liabilities 3,044,859 2,670,233 2,510,409 Long-term operating lease liabilities 1,905,325 1,880,383 1,977,180 Long-term debt 399,172 399,099 398,880 Deferred income taxes 68,228 64,889 55,386 Other non-current liabilities 385,155 298,212 244,232 Total liabilities 5,802,739 5,312,816 5,186,087 Commitments and contingencies (see Note 5 ) STOCKHOLDERS’ EQUITY Preferred stock; par value $ 0.01 ; 5,000 shares authorized, and no shares issued — — — Common stock, par value $ 0.01 ; 300,000 shares authorized, 127,693 shares issued and outstanding at May 2, 2026; 129,638 shares issued and outstanding at January 31, 2026; and 149,743 shares issued and 132,051 outstanding at May 3, 2025 1,277 1,296 1,497 Additional paid-in capital 780,976 995,083 1,095,105 Retained earnings 1,343,933 1,201,207 1,852,416 Accumulated other comprehensive income 73 73 231 Treasury stock, at cost, no shares at May 2, 2026 and January 31, 2026; and 17,692 shares at May 3, 2025 — — ( 977,664 ) Total stockholders’ equity 2,126,259 2,197,659 1,971,585 Total liabilities and stockholders’ equity $ 7,928,998 $ 7,510,475 $ 7,157,672 The accompanying notes are an integral part of the condensed consolidated financial statements. 4 BJ’S WHOLESALE CLUB HOLDINGS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Amounts in thousands, except per share amounts) (Unaudited) Thirteen Weeks Ended May 2, 2026 May 3, 2025 Net sales $ 5,529,145 $ 5,033,094 Membership fee income 132,355 120,389 Total revenues 5,661,500 5,153,483 Cost of sales 4,633,599 4,183,984 Selling, general and administrative expenses 806,010 760,880 Pre-opening expenses 13,978 4,974 Operating income 207,913 203,645 Interest expense, net 12,367 11,099 Income before income taxes 195,546 192,546 Provision for income taxes 52,820 42,778 Net income $ 142,726 $ 149,768 Income per share attributable to common stockholders—basic: $ 1.11 $ 1.14 Income per share attributable to common stockholders—diluted: $ 1.10 $ 1.13 Weighted-average shares of common stock outstanding: Basic 128,650 131,569 Diluted 129,383 132,749 Other comprehensive income: Total other comprehensive income — — Total comprehensive income $ 142,726 $ 149,768 The accompanying notes are an integral part of the condensed consolidated financial statements. 5 BJ’S WHOLESALE CLUB HOLDINGS, INC. CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Amounts in thousands) (Unaudited) Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income Treasury Stock Total Stockholders’ Equity Shares Amount Shares Amount Balance, January 31, 2026 129,638 $ 1,296 $ 995,083 $ 1,201,207 $ 73 — $ — $ 2,197,659 Net income — — — 142,726 — — — 142,726 Common stock issued under stock incentive plans 390 4 ( 4 ) — — — — — Stock-based compensation expense — — 13,280 — — — — 13,280 Exercise of stock options — — 125 — — — — 125 Acquisition of treasury stock — — — — — ( 2,335 ) ( 227,531 ) ( 227,531 ) Retirement of treasury stock ( 2,335 ) ( 23 ) ( 227,508 ) — — 2,335 227,531 — Balance, May 2, 2026 127,693 $ 1,277 $ 780,976 $ 1,343,933 $ 73 — $ — $ 2,126,259 Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income Treasury Stock Total Stockholders’ Equity Shares Amount Shares Amount Balance, February 1, 2025 148,965 $ 1,489 $ 1,079,445 $ 1,702,648 $ 231 ( 17,327 ) $ ( 936,359 ) $ 1,847,454 Net income — — — 149,768 — — — 149,768 Common stock issued under stock incentive plans 778 8 ( 8 ) — — — — — Stock-based compensation expense — — 10,654 — — — — 10,654 Exercise of stock options — — 5,014 — — — — 5,014 Acquisition of treasury stock — — — — — ( 365 ) ( 41,305 ) ( 41,305 ) Balance, May 3, 2025 149,743 $ 1,497 $ 1,095,105 $ 1,852,416 $ 231 ( 17,692 ) $ ( 977,664 ) $ 1,971,585 The accompanying notes are an integral part of the condensed consolidated financial statements. 6 BJ’S WHOLESALE CLUB HOLDINGS, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Amounts in thousands) (Unaudited) Thirteen Weeks Ended May 2, 2026 May 3, 2025 CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 142,726 $ 149,768 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 76,452 69,665 Amortization of debt issuance costs and accretion of original issue discount 273 273 Stock-based compensation expense 13,280 10,654 Deferred income tax provision (benefit) 3,173 ( 4,913 ) Changes in operating leases and other non-cash items ( 30,631 ) ( 24,397 ) Increase (decrease) in cash due to changes in: Accounts receivable, net ( 51,300 ) 39,735 Merchandise inventories ( 112,792 ) ( 58,044 ) Prepaid expenses and other current assets ( 61,537 ) ( 15,283 ) Other assets ( 5 ) ( 1,476 ) Accounts payable 131,526 2,355 Accrued expenses and other current liabilities 24,446 24,783 Other non-current liabilities 4,347 14,973 Net cash provided by operating activities 139,958 208,093 CASH FLOWS FROM INVESTING ACTIVITIES Additions to property and equipment, net of disposals ( 182,004 ) ( 140,497 ) Other investing activities ( 2,630 ) ( 1,794 ) Net cash used in investing activities ( 184,634 ) ( 142,291 ) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from revolving lines of credit 320,000 66,000 Payments on revolving lines of credit ( 65,000 ) ( 91,000 ) Net cash received from stock option exercises 125 5,014 Acquisition of treasury stock ( 225,717 ) ( 41,305 ) Net (payments on) proceeds from financing obligations ( 73 ) 8,721 Other financing activities ( 3,078 ) ( 2,020 ) Net cash provided by (used in) financing activities 26,257 ( 54,590 ) Net (decrease) increase in cash and cash equivalents ( 18,419 ) 11,212 Cash and cash equivalents at beginning of period 46,245 28,272 Cash and cash equivalents at end of period $ 27,826 $ 39,484 Supplemental cash flow information: Interest paid $ 4,207 $ 8,966 Income taxes paid 103,250 12,738 Operating lease liabilities arising from obtaining right-of-use assets and other non-cash lease-related operating items 80,020 14,583 Non-cash financing and investing activities: Finance lease liabilities arising from obtaining right-of-use assets 67,969 525 Receivables arising from failed sale-leaseback financing obligations 15,847 — Property additions included in accrued expenses 50,164 40,404 Treasury stock acquisitions included in accrued expenses 3,886 1,561 The accompanying notes are an integral part of the condensed consolidated financial statements. 7 NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 1. Description of Business BJ’s Wholesale Club Holdings, Inc. and its wholly-owned subsidiaries (the “Company” or “BJ’s”) is a leading operator of membership warehouse clubs concentrated primarily in the eastern half of the United States. The Company provides a curated assortment focused on groceries, fresh foods, general merchandise, gasoline, and other ancillary services to deliver a differentiated shopping experience that is further enhanced by the Company's digital capabilities. As of May 2, 2026, BJ's operated 264 warehouse clubs and 205 gas stations in 22 states. 2. Summary of Significant Accounting Policies (a) Basis of Presentation The accompanying interim financial statements of BJ’s Wholesale Club Holdings, Inc. are unaudited and, in the opinion of management, reflect all normal recurring adjustments considered necessary for a fair statement of the Company’s financial statements in accordance with GAAP. The condensed consolidated balance sheet as of January 31, 2026 is derived from the audited consolidated balance sheet as of that date. The Company’s business, as is common with the business of retailers generally, is subject to some seasonality. The Company’s net sales and cash flows have typically been highest in the fourth quarter holiday season and lowest in the first quarter of each fiscal year. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and footnotes thereto included in our Annual Report on Form 10-K for fiscal year 2025, as filed with the Securities and Exchange Commission on March 12, 2026. (b) Fiscal Year The Company follows the National Retail Federation’s fiscal calendar and reports financial information on a 52- or 53-week year ending on the Saturday closest to January 31. The thirteen-week periods ended May 2, 2026 and May 3, 2025 are referred to herein as the “first quarter of fiscal year 2026” and the “first quarter of fiscal year 2025,” respectively. Operating results for the thirteen week period ended May 2, 2026 are not necessarily indicative of the results that may be expected for the 52-week fiscal year ending January 30, 2027. (c) Recently Issued Accounting Pronouncements and Policies The Company’s accounting policies are set forth in the audited financial statements included in the Company’s Annual Report on Form 10-K for fiscal year 2025. There have been no material changes to these accounting policies and no accounting pronouncements adopted that had a material impact on the Company’s financial statements aside from those identified herein. In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ ASU”) 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses . ASU 2024-03 requires disclosure of certain costs and expenses on an interim and annual basis in the notes to the financial statements. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. The disclosures required under the guidance can be applied either prospectively to financial statements issued for reporting periods after the effective date or retrospectively to any or all periods presented in the financial statements. The Company is currently evaluating the impact of this guidance on the notes to its financial statements, and does not expect ASU 2024-03 to affect its condensed consolidated financial statements. In September 2025, the FASB issued ASU 2025-06, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. ASU 2025-06 modernizes the accounting for internal-use software costs by increasing the operability of the recognition guidance considering different methods of software development, and removing the previous “development stage” model to determine when costs are able to be capitalized. ASU 2025-06 is effective for fiscal years beginning after December 15, 2027 and interim periods within those annual reporting periods. Early adoption is permitted. The Company may apply the guidance prospectively, retrospectively, or via a modified 8 prospective transition method. The Company is currently evaluating the impact that this guidance will have on its condensed consolidated financial statements and disclosures. (d) Recently Adopted Accounting Pronouncements and Policies In December 2025, the FASB issued ASU No. 2025-12, Codification Improvements which serves to clarify, correct errors, or make minor improvements to various topics within the Codification. Generally, the amendments in this ASU are not intended to result in significant changes to current accounting principles. ASU 2025-12 is effective for fiscal years beginning after December 15, 2026 and interim periods within those annual reporting periods. Early adoption is permitted, and entities may elect to adopt the amendments on an issue-by-issue basis. The Company adopted ASU 2025-12 during the first quarter of fiscal year 2026, which changes the accounting for treasury share retirements. Under the new guidance, the Company elected to recognize the excess of the repurchase price over par value entirely as a reduction from additional paid-in-capital (“APIC”), provided that APIC remains positive. This policy change is reflected within the condensed consolidated balance sheets, statements of stockholders’ equity, and “ Note 7 . Treasury Shares and Share Repurchase Program.” The adoption did not impact the condensed consolidated statements of operations and comprehensive income or the statements of cash flows. 3. Revenue Recognition Net sales The Company recognizes net sales at clubs and gas stations when the customer takes possession of the goods and tenders payment. Revenue is recorded at the point-of-sale based on the transaction price, net of any applicable discounts, sales tax, and expected refunds. For digitally-enabled sales, including buy-online-pickup-in-club (“BOPIC”), curbside delivery, and same-day delivery, the Company generally recognizes revenue when the customer takes possession of the merchandise. For ship-to-home sales, the Company recognizes revenue when control of the merchandise is transferred to the customer, which is typically at the time of shipment. In the ordinary course of business, sales tax is collected at the time of purchase on items that are taxable in the respective jurisdiction. Sales tax is not included within net sales in the consolidated statements of operations and comprehensive income. Sales tax is recorded as a liability at the point-of-sale and subsequently remitted to the appropriate taxing authority. Rewards programs The Company’s Club+ program allows participating members to earn 2 % cash back, up to a maximum of $ 500 per year, on qualified purchases made in BJ’s clubs, on bjs.com, or in the BJ’s mobile app, a 5 -cent per gallon discount at BJ’s gas locations, and two free same-day deliveries. Cash back is in the form of electronic rewards issued to each member once $ 10 in rewards have been earned. The Company’s co-branded credit card program, known as the BJ’s One and BJ’s One+ program, allows cardholders the opportunity to earn up to 5 % cash back on purchases made in BJ’s clubs, on bjs.com, or in the BJ’s mobile app, and up to a 15 -cent per gallon discount on gasoline when paying with a BJ’s One or BJ’s One+ Mastercard at BJ’s gas locations. BJ’s One+ Mastercard cardholders also receive two free same-day deliveries if such benefit has not already been received under the Club+ program. Cash back is in the form of electronic rewards issued to each member monthly on the credit card statement date. Earned rewards on each of the Club+ and co-branded credit card programs do not expire. The Company accounts for these transactions as multiple-element arrangements and allocates the transaction price to separate performance obligations using their relative fair values. The Company includes the fair value of rewards in deferred revenue at the time the rewards are earned. Earned rewards may be redeemed on future purchases made at BJ’s. The Company recognizes revenue related to earned rewards when customers redeem such rewards as part of a purchase at one of the Company’s clubs, on bjs.com, or in the BJ’s mobile app. While the Company continues to honor all rewards presented for redemption, the likelihood of redemption is deemed to be remote for certain rewards due to historical experience, including after long periods of inactivity, and rewards being linked to expired or canceled memberships. In these circumstances, the Company recognizes revenue, or breakage, from unredeemed rewards. The Company earns monthly royalties under the BJ’s One and BJ’s One+ credit card programs related to the use of the BJ’s trade name and the issuance of rewards and gasoline discounts to cardholders. Royalty revenue is recognized based upon actual customer activities, such as reward redemptions, in the period in which the underlying activity occurs. 9 Membership The Company charges a membership fee to its customers, which allows customers to shop in the Company’s clubs, on bjs.com, or in the BJ’s mobile app, and purchase gasoline at the Company’s gas stations for the duration of the membership, which is generally twelve months . In addition, members have access to other ancillary services, coupons, and promotions. As the Company has the obligation to provide access to its clubs, website, mobile app, and gas stations for the duration of the membership term, the Company recognizes membership fees on a straight-line basis over the life of the membership. All membership fees and related membership revenues are recorded as membership fee income in the condensed consolidated statements of operations and comprehensive income. Gift Card Program The Company sells BJ’s gift cards that allow customers to redeem the cards for future purchases equal to the loaded value of the gift card. Revenue from gift card sales is recognized upon redemption of the gift cards and control of the purchased goods or services is transferred to the customer. Contract Balances Current and long-term deferred revenue balances are included within accrued expenses and other current liabilities and other non-current liabilities, respectively, in the condensed consolidated balance sheets. The following table summarizes the Company’s deferred revenue balance related to outstanding performance obligations for contracts with customers, excluding earned rewards which are noted below (in thousands): May 2, 2026 January 31, 2026 May 3, 2025 Current: Rewards programs: Royalty revenue $ 6,679 $ 10,572 $ 6,913 Co-brand initiatives 2,580 2,910 3,945 Total rewards programs 9,259 13,482 10,858 Membership 285,237 240,643 260,578 Gift card program 17,083 18,252 15,875 E-commerce sales 7,928 9,059 6,866 Long-term: Rewards programs: Co-brand initiatives 2,221 2,324 2,317 Total deferred revenue $ 321,728 $ 283,760 $ 296,494 The following table presents deferred revenue activity related to earned rewards (in thousands): Thirteen Weeks Ended May 2, 2026 May 3, 2025 Earned rewards balance, beginning of period $ 71,427 $ 57,474 Rewards earned 97,116 88,197 Revenue recognized on rewards ( 95,924 ) ( 84,383 ) Earned rewards balance, end of period $ 72,619 $ 61,288 Earned rewards are combined in one homogeneous pool and are not separately identifiable. Revenue recognized on rewards consists of rewards that were included in the deferred revenue balance at the beginning of the period as well as rewards that were earned during the period. 10 The following table summarizes the Company’s revenue recognized during the period that was included in the opening deferred balance, excluding earned rewards, as of January 31, 2026 and February 1, 2025 (in thousands) : Thirteen Weeks Ended May 2, 2026 May 3, 2025 Rewards programs: Royalty revenue $ 10,572 $ 9,972 Co-brand initiatives 1,111 960 Total rewards programs 11,683 10,932 Membership 107,743 106,337 Gift card program 2,787 2,707 E-commerce sales 9,059 7,839 Total revenue $ 131,272 $ 127,815 Performance obligations related to royalty revenue, membership fees, and e-commerce sales are typically satisfied over a period of twelve months or less. Funds received related to marketing and other integration costs in connection with our co-brand credit card program are recognized as performance obligations are satisfied. The timing and recognition of earned rewards and gift card redemptions varies depending on consumer behavior and spending patterns. Disaggregation of Revenue The following table summarizes the Company’s percentage of net sales disaggregated by category: Thirteen Weeks Ended May 2, 2026 May 3, 2025 Perishables, Grocery, and Sundries 69 % 73 % General Merchandise and Services 10 % 9 % Gasoline and Other 21 % 18 % 4. Debt and Credit Arrangements The following table summarizes the Company’s debt (in thousands): May 2, 2026 January 31, 2026 May 3, 2025 ABL Revolving Facility $ 375,000 $ 120,000 $ 150,000 First Lien Term Loan 400,000 400,000 400,000 Unamortized original issue discount and debt issuance costs ( 828 ) ( 901 ) ( 1,120 ) Less: Short-term debt ( 375,000 ) ( 120,000 ) ( 150,000 ) Long-term debt $ 399,172 $ 399,099 $ 398,880 ABL Revolving Facility On July 28, 2022, the Company entered into the ABL Revolving Facility with an ABL Revolving Commitment of $ 1.20 billion pursuant to that certain credit agreement (the “Credit Agreement”) with Bank of America, N.A., as administrative agent and collateral agent, and the other lenders party thereto. The maturity date of the ABL Revolving Facility is July 28, 2027. 11 Revolving loans under the ABL Revolving Facility are available in an aggregate amount equal to the lesser of the aggregate ABL Revolving Commitment or a borrowing base based on the value of certain inventory and accounts and credit card receivables, subject to specified advance rebates and reserves as set forth in the Credit Agreement. Indebtedness under the ABL Revolving Facility is secured by substantially all of the assets (other than real estate) of the Company and its subsidiaries, subject to customary exceptions. As amended, interest on the ABL Revolving Facility is calculated either at SOFR plus a range of 100 to 125 basis points or a base rate plus 0 to 25 basis points, based on excess availability. The Company will also pay an unused commitment fee of 20 basis points per annum on the unused ABL Revolving Commitment. Each borrowing is for a period of one , three , or six months , as selected by the Company, or for such other period that is twelve months or less requested by the Company and consented to by the lenders and administrative agent. The ABL Revolving Facility places certain restrictions (i.e., covenants) upon the Borrower’s, and its subsidiaries’, ability to, among other things, incur additional indebtedness, pay dividends, and make certain loans, investments, and divestitures. The ABL Revolving Facility contains customary events of default (including payment defaults, cross-defaults to certain of our other indebtedness, breach of representations and covenants and change of control). The occurrence of an event of default under the ABL Revolving Facility would permit the lenders to accelerate the indebtedness and terminate the ABL Revolving Facility. As of May 2, 2026, there was $ 375.0 million outstanding in loans under the ABL Revolving Facility and $ 8.8 million in outstanding letters of credit. The interest rate on the ABL Revolving Facility was 4.75 % and unused capacity was $ 816.2 million. As of January 31, 2026 and May 3, 2025, the interest rate on the ABL Revolving Facility was 4.77 % and 5.42 %, respectively. First Lien Term Loan On November 4, 2024, the Company entered into an amendment (the “Fifth Amendment”) to the First Lien Term Loan Credit Agreement, with Nomura Corporate Funding Americas, LLC, as administrative agent and collateral agent, and the lenders party thereto. The Fifth Amendment, among other things, provided for a new tranche of term loans in an aggregate principal amount of $ 400.0 million, which refinanced and replaced in full the existing Tranche B term loans outstanding under the First Lien Term Loan Credit Agreement immediately prior to the effectiveness of the Fifth Amendment. In addition, the Fifth Amendment reduced applicable margin in respect of the interest rate from SOFR plus 200 basis points per annum to SOFR plus 175 basis points per annum. The maturity date of the First Lien Term Loan is February 3, 2029. Voluntary prepayments are permitted. Principal payments must be made on the First Lien Term Loan pursuant to an annual excess cash flow calculation when the net leverage ratio exceeds 3.50 to 1.00. As of May 2, 2026, the Company's net leverage ratio did not exceed 3.50 to 1.00, and therefore, no incremental principal payments were required. The First Lien Term Loan is subject to certain affirmative and negative covenants but no financial covenants. It is secured on a senior basis by certain “fixed assets” of the Company and on a junior basis by certain “liquid” assets of the Company. There was $ 400.0 million outstanding under the First Lien Term Loan as of each of May 2, 2026, January 31, 2026, and May 3, 2025. The interest rate on the First Lien Term Loan was 5.41 %, 5.43 %, and 6.07 % at May 2, 2026, January 31, 2026, and May 3, 2025, respectively. 5. Commitments and Contingencies The Company is involved in various legal proceedings that are typical of a retail business. In accordance with applicable accounting guidance, an accrual will be established for legal proceedings if and when those matters present loss contingencies that are both probable and estimable. The Company does not believe the resolution of any current proceedings will result in a material impact to the condensed consolidated financial statements. Gain contingencies are recognized when they are realized or realizable. 12 6. Stock Incentive Plans On June 13, 2018, the Company’s board of directors adopted, and its stockholders approved, the BJ’s Wholesale Club Holdings, Inc. 2018 Incentive Award Plan (the “2018 Plan”). The 2018 Plan provides for, among other types of awards, the grant of restricted stock, restricted stock units, and performance shares. The 2018 Plan authorizes the issuance of 13,148,058 shares and allows for most shares that are forfeited, expire, or are settled in cash to be reissued for new grants that may be awarded. For further details on the 2018 Plan, refer to “Note 11. Stock Incentive Plans” included in our Annual Report on Form 10-K for fiscal year 2025, as filed with the Securities and Exchange Commission on March 12, 2026. As of May 2, 2026, there were 4,051,667 shares available for future issuance under the 2018 Plan. The following table summarizes the Company’s stock award activity during the thirteen weeks ended May 2, 2026 (shares in thousands): Stock Options Restricted Stock Restricted Stock Units Performance Stock Units Shares Weighted- Average Exercise Price Shares Weighted- Average Grant Date Fair Value Shares Weighted- Average Grant Date Fair Value Shares (a) Weighted- Average Grant Date Fair Value Outstanding, January 31, 2026 522 $ 20.52 93 $ 78.15 480 $ 95.76 507 $ 84.56 Granted (b) — — — — 294 94.61 242 94.61 Forfeited/canceled (c) — — ( 1 ) 76.07 ( 11 ) 95.41 ( 12 ) 76.07 Exercised/vested ( 5 ) 25.07 ( 81 ) 76.07 ( 174 ) 91.29 ( 211 ) 64.58 Outstanding, May 2, 2026 517 $ 20.47 11 $ 92.95 589 $ 96.51 526 $ 93.78 (a) Shares outstanding reflect a 100 % payout. However, the actual payout for the remaining performance stock unit awards granted in fiscal year 2021 is expected to be 200 %, and the actual payout for performance stock unit awards granted in fiscal year 2023, which vested in the first quarter of fiscal year 2026, was 92 %. Actual payout for the performance stock unit awards granted in each of fiscal years 2024, 2025, and 2026, which vest in fiscal years 2027, 2028, and 2029, respectively, could be below 100 % or up to 300 %. (b) Includes 38 incremental performance stock units granted in fiscal year 2021 with a weighted-average grant date fair value of $ 44.04 , that vested in fiscal year 2026 at greater than 100 % of target payout based on performance. (c) Includes 12 performance stock units granted in fiscal year 2023 with a weighted-average grant date fair value of $ 76.07 , that vested in fiscal year 2026 at less than 100 % of target payout based on performance. Stock-based compensation expense was $ 13.3 million and $ 10.7 million for the thirteen weeks ended May 2, 2026 and May 3, 2025, respectively. On June 14, 2018, the Company’s board of directors adopted, and its stockholders approved, the ESPP, which became effective July 1, 2018. The aggregate number of shares of common stock reserved for issuance under the ESPP is equal to the sum of (i) 973,014 shares and (ii) an annual increase on the first day of each calendar year beginning in 2019 and ending in 2028 equal to the lesser of (A) 486,507 shares, (B) 0.5 % of the shares outstanding (on an as converted basis) on the last day of the immediately preceding fiscal year and (C) such smaller number of shares as determined by the Company’s board of directors. The amount of expense recognized related to the ESPP was $ 0.6 million and $ 0.5 million for the thirteen weeks ended May 2, 2026 and May 3, 2025, respectively. As of May 2, 2026, there were 3,644,425 shares available for issuance under the ESPP. 13 7. Treasury Shares and Share Repurchase Program Treasury Shares Acquired on Stock-Based Awards The Company acquired 221,072 shares for $ 21.0 million and 310,102 shares for $ 35.1 million in the thirteen weeks ended May 2, 2026 and May 3, 2025, respectively, to satisfy employees’ tax withholding obligations upon the vesting of restricted stock and performance stock awards, which was recorded as treasury stock. Share Repurchase Program On November 18, 2024, the Company’s board of directors approved a share repurchase program (the “2024 Repurchase Program”) that allows the Company to repurchase up to $ 1.00 billion of its outstanding common stock from time to time as market conditions warrant. The 2024 Repurchase Program was effective on February 1, 2025 and expires in January 2029. The timing and actual number of shares repurchased will depend on a variety of factors including price, corporate requirements, market conditions, and other corporate liquidity requirements and priorities. The Company initiated the 2024 Repurchase Program to mitigate potentially dilutive effects of stock awards granted by the Company, in addition to enhancing shareholder value. The Company repurchased 2,114,000 shares for $ 206.6 million and 55,000 shares for $ 6.2 million under the 2024 Repurchase Program during the thirteen weeks ended May 2, 2026 and May 3, 2025, respectively. The Company accounts for treasury stock under the cost method based on the fair market value of the shares on the dates of repurchase plus any direct costs incurred. As of May 2, 2026, $ 545.0 million remained available to purchase under the 2024 Repurchase Program. Retirement of Treasury Shares During the first quarter of fiscal 2026, the Company retired 2,335,072 shares of treasury stock, which represented the cumulative number of shares held in the Company’s treasury due to acquisitions during the current period. The retirement of these shares resulted in decreases in each of treasury stock and APIC of $ 227.5 million. There were no share retirements during the first quarter of fiscal year 2025. 8. Income Taxes The Company projects the estimated annual effective tax rate for fiscal year 2026 to be 27.4 %, excluding the tax effect of discrete events, such as excess tax benefits from stock-based compensation, changes in tax legislation, settlements of tax audits and changes in uncertain tax positions, among others. The Company’s effective income tax rate was 27.0 % and 22.2 % for the thirteen weeks ended May 2, 2026 and May 3, 2025, respectively. The increase in the effective income tax rate was primarily attributable to lower excess tax benefits from stock-based compensation compared to the prior year period. Cash taxes paid as presented in the supplemental cash flow information section of the condensed consolidated statements of cash flows includes $ 91.2 million paid for transferable credits during the thirteen weeks ended May 2, 2026. The Company is subject to taxation in the U.S. federal and various state taxing jurisdictions. The Company’s tax years from 2022 forward remain open and subject to examination by the Internal Revenue Service and various state taxing authorities. On July 4, 2025, new legislation, commonly known as the One Big Beautiful Bill Act (the “Act”), was signed into law. Among other provisions, the Act reestablished and made permanent 100% initial-year bonus depreciation on qualifying property, as well as the immediate deduction for domestic research and development expenses. The Company has quantified the impact of the Act to our financial statements and has reflected the effects within the consolidated financial statements as of and for the thirteen weeks ended May 2, 2026. 14 9. Fair Value Measurements Certain assets and liabilities are required to be carried at fair value in accordance with GAAP. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company uses a three-level hierarchy that prioritizes the inputs used to measure fair value. This hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable inputs other than quoted market prices included in Level 1 such as quoted market prices for markets that are not active or other inputs that are observable or can be corroborated by observable market data. Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities, including certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. Financial Assets and Liabilities The fair value of the Company’s long-term debt is estimated based on current market rates for our specific debt instrument. Judgment is required to develop these estimates. As such, the estimated fair value of long-term debt is classified within Level 2, as defined under GAAP. The gross carrying amount and fair value of the Company’s debt at May 2, 2026 are as follows (in thousands): Carrying Amount Fair Value ABL Revolving Facility $ 375,000 $ 375,000 First Lien Term Loan 400,000 402,500 Total Debt $ 775,000 $ 777,500 The gross carrying amount and fair value of the Company’s debt at January 31, 2026 are as follows (in thousands): Carrying Amount Fair Value ABL Revolving Facility $ 120,000 $ 120,000 First Lien Term Loan 400,000 404,252 Total Debt $ 520,000 $ 524,252 The gross carrying amount and fair value of the Company’s debt at May 3, 2025 are as follows (in thousands): Carrying Amount Fair Value ABL Revolving Facility $ 150,000 $ 150,000 First Lien Term Loan 400,000 400,916 Total Debt $ 550,000 $ 550,916 Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis The Company believes that the carrying amounts of its other financial instruments, including cash, accounts receivable, and accounts payable, approximate their fair values due to the short-term maturities of these instruments. 15 10. Earnings Per Share The table below reconciles basic weighted-average shares of common stock outstanding to diluted weighted-average shares of common stock outstanding for the thirteen weeks ended May 2, 2026 and May 3, 2025 (in thousands): Thirteen Weeks Ended May 2, 2026 May 3, 2025 Weighted-average shares of common stock outstanding, used for basic computation 128,650 131,569 Plus: Incremental shares of potentially dilutive securities 733 1,180 Weighted-average shares of common stock and dilutive potential shares of common stock outstanding 129,383 132,749 The table below summarizes awards that were excluded from the computation of diluted earnings for the thirteen weeks ended May 2, 2026 and May 3, 2025, as their inclusion would have been anti-dilutive (in thousands): Thirteen Weeks Ended May 2, 2026 May 3, 2025 Stock-based awards 246 89 11. Segment Reporting The Company’s operations are primarily retail club and other sales procured from clubs and distribution centers, representing one operating segment. All of the Company’s identifiable assets are located in the United States. The Company does not have significant sales outside the United States, nor does any customer represent more than 10% of total revenues for any period presented. The chief operating decision maker (“CODM”) is the Company’s chairman and chief executive officer. The CODM uses net income, as reported in the condensed consolidated statements of operations and comprehensive income, in evaluating performance of the retail operations segment and determining how to allocate resources of the Company as a whole, including investing in clubs, stockholder return programs, and other strategies. The CODM does not review assets when evaluating the results of the segment, and therefore, such information is not presented. The following table provides the operating financial results of our reportable segment (in thousands): Thirteen Weeks Ended May 2, 2026 May 3, 2025 Total revenues $ 5,661,500 $ 5,153,483 Less: significant and other segment expenses Merchandise cost of sales (a) 3,520,203 3,363,785 Selling, general and administrative expenses (b) 819,988 765,854 Other segment expenses (c) 1,178,583 874,076 Net income $ 142,726 $ 149,768 (a) Merchandise cost of sales represents those expenses related to the sales of merchandise including inventory costs and distribution costs, and excludes costs related to gasoline and membership fee income. (b) Selling, general and administrative expenses is inclusive of pre-opening expenses, stock-based compensation, and other corporate expenses. (c) Other segment expenses primarily consists of other costs of revenues, including gas, as well as interest expense and income tax expense. 16 FORWARD-LOOKING STATEMENTS This Quarterly Report on Form 10-Q contains forward-looking statements. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q should be considered forward-looking statements, including, without limitation, statements regarding our future results of operations and financial position, business strategy, transformation, strategic priorities and future progress, including expectations regarding deferred revenue, lease commencement dates, impact of infrastructure investments on our operating model and selling, general and administrative expenses, sales of gasoline and gross profit margin rates, share repurchases, and new club and gas station openings, as well as statements that include terms such as “may,” “might,” “will,” “should,” “expect,” “plan,” “anticipate,” “can,” “could,” “intend,” “confident,” “project,” “believe,” “estimate,” “predict,” “continue,” “forecast,” “would,” or the negative of these terms or other similar expressions. The forward-looking statements in this Quarterly Report on Form 10-Q are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to: • uncertainties in the financial markets including, without limitation, as a result of disruptions and instability in the banking and financial services industries, wars and global political conflicts, and the effect of certain economic conditions or events on consumer and small business spending patterns and debt levels; • risks related to our dependence on having a large and loyal membership; • domestic and international economic conditions, including volatility in inflation or interest rates, supply chain disruptions, construction delays, tariffs, and exchange rates; • our ability to procure the merchandise we sell at the best possible prices; • the effects of competition in, and regulation of, the retail industry; • our dependence on vendors to supply us with quality merchandise at the right time and at the right price; • risks related to our indebtedness; • changes in laws related to, or the government’s administration of, the Supplemental Nutrition Assistance Program (“SNAP”) or its electronic benefit transfer systems; • the risks and uncertainties related to the impact of any pandemic, epidemic or outbreak of any other highly infectious disease on the U.S., regional and global economies and on our business, financial condition and results of operations; • risks related to climate change and natural disasters, including hurricanes; • our ability to identify and respond effectively to consumer trends, including our ability to successfully maintain a relevant digital experience for our members; • risks related to cybersecurity, which may be heightened due to our e-commerce business, including our ability to protect the privacy of member or business information and the security of payment card information; • risks relating to our ability to attract and retain a qualified management team and other team members; • risks relating to our ability to implement our growth strategy by opening new clubs, and gasoline stations; and • the other risk factors identified in our filings with the Securities and Exchange Commission (the “SEC”), including in particular those set forth under “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended January 31, 2026 (the “Annual Report on Form 10-K for fiscal year 2025”) and our other filings with the SEC. Given these uncertainties, you should not place undue reliance on any forward-looking statements. Except as required by applicable law, we assume no obligation to update these forward-looking statements, even if new information becomes available in the future, and you should not rely upon these forward-looking statements after the date of this Quarterly Report on Form 10-Q. 17