Costco Sells $150K Diamonds and Babe Ruth Memorabilia to Excite Members

You can buy a rotisserie chicken at Costco for under $5. You can also, apparently, buy a $150,000 diamond ring. That contrast is the whole point.

Costco Wholesale (NASDAQ:COST) reported Q2 FY2026 earnings after the bell on March 5, 2026, and the numbers were solid across the board. But one of the more interesting moments came when the CFO highlighted some of the unusual items Costco moved last quarter. As CNBC’s Morgan Brennan reported, the CFO revealed that Costco sold an emerald cut 5.8 carat diamond ring for $150,000 and a baseball autographed by Babe Ruth for $20,000. The takeaway from management was direct: “Costco says unique items continue to play a role in generating excitement for its members.”

That word “excitement” is doing a lot of work in that sentence.

The Treasure Hunt Is the Product

Costco’s retail model is built on something most retailers cannot replicate. Members pay an annual fee just to walk through the door, which means Costco’s job is not just to sell you things. It is to make you feel like the membership is worth it every single time you visit.

The $150K diamond and the Babe Ruth baseball are not serious revenue drivers. They are conversation starters. They are the reason a member tells their neighbor, “You will not believe what I saw at Costco this weekend.” That word-of-mouth is priceless, and it keeps the renewal flywheel spinning.

The numbers back up how well this flywheel is working. Worldwide renewal rates hit 89.7%, with 82.1 million paid memberships on the books. Membership fee income grew 13.6% year-over-year to $1.355 billion, outpacing even the strong 9.1% growth in net sales. When your fee income grows faster than your merchandise sales, members are not just renewing out of habit. They genuinely believe in the value.

The Broader Picture

Revenue came in at $69.6 billion, beating estimates, while net income grew 13.8% to $2.035 billion. E-commerce comparable sales surged 22.6%, and app visits grew 63%. The company is targeting approximately 28 net new warehouses in FY2026 to reach 942 total locations.

The stock trades at roughly 54x trailing earnings, which is a premium valuation by any measure. Analysts carry an average price target of $1,052.94, suggesting modest upside from current levels.

But here is what the valuation really reflects: Costco has figured out that retail is not about products. It is about belonging. When your CFO is talking about Babe Ruth baseballs on an earnings call, that is not a distraction from the business model. That is the business model working exactly as designed.