2025 proved to be a challenging year for retail as global inflation, tariff negotiations, and the focus toward AI stole most of the headlines. The growing necessity for a stronger business model, customer loyalty, and flexibility to pivot through challenges like tariffs, inflation, and supply chain constraints created separation where quality names like Costco Wholesale Corporation (NASDAQ: COST) and Walmart Inc. (NASDAQ: WMT) shined.
For emerging companies, both young and established brands, penetration into Costco and Walmart can mean the difference between stagnation and delivering compelling growth to shareholders. AXIL Brands Inc. (NYSE American: AXIL) began their growth trend in last quarter’s reported revenues following orders from an estimated several hundred Costco stores pushing approximately 25% revenue growth in their core hearing protection division and blended growth around 17%. Already profitable with over a 500% increase in positive cash flow from FY2024 to FY2025 and 45% growth in cash equivalents strengthening their balance sheet during the same period, AXIL seeks to strengthen this revenue growth trend into the new year with a recently announced distribution agreement targeting a 2026 launch into 3700 Walmart stores. AXIL’s growth in cash on hand was fully organic and non-dilutive, highlighting a fully diluted share count reduction from over 16 million shares at the start of FY2024 down to just over 8.2 million shares fully diluted at the end of FY2025 from a preferred share stock buyback.
Costco’s sales trend shows strong, consistent growth, with recent reports indicating an 8.2% rise in net sales for late 2025 and early 2026, driven by increased shopper traffic, higher spending per visit, and significant digital sales growth of over 20% in Q1 FY2026. Walmart similarly posted strong recent sales trends led by over 27% growth in their e-commerce. Despite these strong double-digit e-commerce growth trends at both Walmart and Costco, brick-and-mortar still makes up 70-80% of all U.S. retail sales, proving the hybrid a likely dominant model into 2026. AXIL’s revenue makeup, once dominated by online sales in prior years, seeks to shift for a stronger balance between online, direct-to-consumer, and their recent wholesale success.
Household name Danone S.A. (OTCQX: GPDNF) has also seen success with Costco, and management recently decided to buy back stock. While sales numbers remained stable, Danone’s Oikos brand fared well with double-digit growth and encouraging results in a 2024 launch at Costco.