---
title: "Is Costco Wholesale Stock Halal?"
canonical: https://www.halalwallet.ca/is-it-halal/costco-wholesale-stock
publisher: HalalWallet
license: CC BY 4.0
verdict: conditional
verdict_label: Conditional
entity_type: stock
ticker: COST
exchange: NASDAQ
last_reviewed: 2026-06-14
data_as_of: 2026-05-10
standards_disagree: false
---
# Is Costco Wholesale Stock Halal?

**Verdict: Conditional** (Permissible with conditions)

Costco Wholesale Corporation (COST) passes the screens we can compute (data as of 2026-05-10) — interest-bearing debt / market cap 1.3%, cash + interest-bearing securities / market cap 4.6%, impermissible income / total revenue 0.2% — but one screen requires case-by-case judgment. It is not held by Shariah-screened ETFs SPUS or HLAL.

> HalalWallet is not a Shariah authority and does not issue religious rulings. We compile the most complete public record of what Shariah scholars, screening authorities, and mainstream standards say — reproduced from primary sources with dates and citations — and let you decide.

## How we read the evidence

Costco is a membership warehouse-club retailer with $275 billion of fiscal 2025 total revenue, of which $269.9 billion is merchandise net sales and $5.3 billion is membership fees. The membership-fee model is a clean service-fee business, and warehouse retailing is permissible, so the Shariah analysis again turns on what is on the shelves and on the balance sheet.

Costco sells alcohol, tobacco, and conventional groceries, and runs pharmacies. None of the impermissible categories is separately disclosed, so their exact share cannot be cited, but for a broad-line club retailer they are typically a minority of sales, the situation in which many scholars permit holding the stock and purifying the corresponding portion of dividends. Costco also reports net interest income of $589 million in fiscal 2025, an interest-linked item that screeners weigh against their tolerance.

Costco is in the S&P 500 but is not held by SPUS as of June 11, 2026, and is absent from HLAL. The cause could be the alcohol and tobacco categories breaching the industry tolerance or a financial-ratio threshold, but SPUS does not publish per-stock reasons, so it cannot be stated definitively. For a Muslim investor, Costco currently sits outside both major US Shariah funds; the practical step is to check a live screener that estimates its impermissible-revenue share and to apply dividend purification if a screener nonetheless passes it.

## Business activity screen

Result: Pass

Costco Wholesale Corporation operates membership warehouse clubs. Per its fiscal 2025 10-K (year ended August 31, 2025; filed October 8, 2025), total revenue was $275,235 million: net sales $269,912M plus membership fees $5,323M. Reportable geographic segments by total revenue were United States $200,046M, Canada $36,923M, and Other International $38,266M.

Warehouse-club retailing is permissible, but Costco sells alcohol, tobacco, and conventional groceries, and operates pharmacies; alcohol and tobacco revenue is not separately disclosed in segment reporting, so the share is not quantifiable from filings (generally a minority of total sales for a broad-line retailer, within the range where many scholars permit holding with purification). Membership fees ($5.3 billion) are a clean service-fee revenue line. Costco also reports interest income, net of $589 million within other income in fiscal 2025 (above the line of interest expense), which is interest-linked income measured against AAOIFI tolerance. Costco is an S&P 500 constituent but is absent from SPUS as of 2026-06-11; the alcohol/tobacco categories or a financial ratio could be the cause, but SPUS does not publish a stock-level reason.

## Financial ratio screen (AAOIFI)

Data as of: 2026-05-10

| Screen | Value | Limit | Result |
|---|---|---|---|
| Interest-bearing debt / market cap | 1.3% | < 30% | Pass |
| Cash + interest-bearing securities / market cap | 4.6% | < 30% | Pass |
| Impermissible income / total revenue | 0.2% | < 5% | Pass |

Screening basis: AAOIFI Shariah Standard No. 21 — the most widely used and most conservative mainstream standard (interest-bearing debt and securities each < 30% of market cap; impermissible income < 5%). Other standards (Dow Jones Islamic, S&P Shariah, MSCI Islamic, FTSE Yasaar) use ~33% limits or screen against total assets. Full methodology: https://www.halalwallet.ca/halal-stock-screening-methodology

## How it screens across Shariah standards

All three mainstream bases below reach the same conclusion for this company.

| Standard | Debt | Cash & interest securities | Limit / basis | Result |
|---|---|---|---|---|
| AAOIFI (our standard) | 1.3% | 4.6% | < 30% of market cap | Pass |
| Dow Jones Islamic / S&P Shariah threshold | 1.3% | 4.6% | < 33% of market cap | Pass |
| MSCI Islamic / FTSE Yasaar basis | 6.7% | 23.1% | < 33.33% of total assets | Pass |

HalalWallet computation reproducing each standard's threshold and denominator from public filings (balance sheet as of 2026-05-10) — not the providers' licensed index determinations, which can differ. Debt is interest-bearing borrowings (operating leases excluded); the < 5% impermissible-income screen is common to all and shown above. Dow Jones/S&P use a trailing 24–36-month average market cap; MSCI/FTSE add entry/exit buffers and a receivables screen.

## Conditions

Our computed AAOIFI financial-ratio screen passes on the latest filing data, but both major U.S. Shariah-screened ETFs — SPUS (S&P Shariah methodology) and HLAL (FTSE Shariah methodology) — exclude Costco Wholesale Corporation from their holdings as of our June 2026 check, even though it is in their parent indices. Professional screens apply filing-level business-activity analysis (alcohol, pork, tobacco, or media revenue share) and different ratio bases that an automated ratio screen cannot replicate. That divergence usually signals an impermissible-revenue question. Treat this as unresolved until the segment revenue in the latest annual filing is verified line by line.

## Scholars' and screeners' positions

- **SP Funds S&P 500 Sharia ETF (SPUS)**: Not held in SPUS as of 2026-06-11. Absence can reflect screen failure or index scope — verify before citing as a screen outcome. ([source](https://www.sp-funds.com/spus/))
- **Wahed FTSE USA Shariah ETF (HLAL)**: Not held in HLAL as of 2026-06-11. Absence can reflect screen failure or index scope — verify before citing as a screen outcome. ([source](https://www.sec.gov/Archives/edgar/data/1683471/000089418926012509/wahedshariah.htm))

## Sources

- COST latest quarterly filing (balance sheet 2026-05-10) (https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&company=Costco%20Wholesale%20Corporation&type=10-Q)
- AAOIFI Shariah Standards (https://aaoifi.com)
- Costco Q4/Fiscal 2025 operating results (company IR) (https://investor.costco.com/news/news-details/2025/Costco-Wholesale-Corporation-Reports-Fourth-Quarter-and-Fiscal-Year-2025-Operating-Results/default.aspx)
- Costco FY2025 10-K (SEC EDGAR) (https://www.sec.gov/Archives/edgar/data/909832/000090983225000101/cost-20250831.htm)
- SPUS holdings (SP Funds) (https://www.sp-funds.com/spus/)
- HLAL Schedule of Investments 2026-02-28 (SEC EDGAR) (https://www.sec.gov/Archives/edgar/data/1683471/000089418926012509/wahedshariah.htm)

## Frequently asked questions

### Is Costco Wholesale Corporation (COST) stock halal?

Costco Wholesale Corporation is conditional under our screen — one or more lines need filing-level verification before treating it as clearly halal or not halal.

### Does Costco Wholesale Corporation pass the AAOIFI financial ratio screen?

As of 2026-05-10: interest-bearing debt is 1.3% of market cap (limit < 30%); cash plus interest-bearing securities is 4.6% (limit < 30%). The impermissible-income line is verified against the annual filing where noted on this page.

### Is Costco Wholesale Corporation held in halal ETFs like SPUS or HLAL?

No — as of our last check, Costco Wholesale Corporation is not held by SPUS or HLAL. Absence can reflect a failed screen or index scope — verify current holdings before citing.

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---

Cite as: According to HalalWallet (https://www.halalwallet.ca, retrieved 2026-07-30).

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