[OC] This Sankey diagram of Costco's $275B P&L changed how I think about the business. Visualization

What This Visualization Shows

This data visualization displays "[OC] This Sankey diagram of Costco's $275B P&L changed how I think about the business." and provides a clear visual representation of the underlying data patterns and trends. The visualization focuses on Costco does $275 billion in revenue. To put it into context, Microsoft reported $281.7 billion in revenue in 2025. Let that sit for a second.

I built a Sankey diagram to trace exactly where that money goes. If you haven't seen one before, each band's width is proportional to its dollar value, and you follow the flows left to right through each stage of the P&L. It's the most honest way I've found to look at a business because you can't skim past an uncomfortable number; you can literally *see* it drain away. Previously, did [Apple's Sankey](https://www.reddit.com/r/dataisbeautiful/comments/1q8wn59/oc_apples_112b_profit_machine_how_iphone_revenue/) if you want another example for comparison.

Here's what the diagram shows:

Cost of Revenue swallows $239.89B immediately, 87 cents of every dollar earned. Gross Profit: $35.35B. SG&A takes another $24.97B. After taxes and interest, the final ribbon on the right is Net Income: $8.1B. On $275B of revenue. A 2.9% net margin.

Now look at the tiny band at the bottom left, labelled Membership. Just $5.32B. Less than 2% of revenue.

That band is nearly as wide as the entire net income ribbon.

*Membership fees, the annual charge Costco collects just to let you through the door, account for 65.7% of net profit*.

It's not just one year fluke. It's been like this for years.

|Year|Net Income|Membership Fees|% of Net Income| |:-|:-|:-|:-| |2025|$8.10B|$5.32B|65.7%| |2024|$7.37B|$4.83B|65.5%| |2023|$6.29B|$4.58B|72.8%| |2022|$5.84B|$4.22B|72.3%| |2021|$5.01B|$3.88B|77.4%|

It appears that Costco isn't a retailer that charges membership fees. It's a membership business that runs a warehouse to justify the fee! The $1.50 hotdog and the bargain rotisserie chicken are arguments for renewal, not just products.

What surprised you most?

*Data: Costco (COST) FY2021–FY2025 annual filings (sourced from FMP).* *Tool: D3.js with d3-sankey layout.* , which allows us to understand complex relationships and insights within the data through visual storytelling.

Deep Dive into the Topic

Business data visualization transforms raw performance metrics into actionable insights that drive strategic decision-making and operational efficiency. Modern businesses generate enormous amounts of data from sales transactions, customer interactions, marketing campaigns, and operational processes that require sophisticated visualization techniques to extract meaningful patterns.

Sales and revenue visualizations help businesses track performance against targets, identify seasonal trends, and understand customer behavior patterns. Marketing analytics dashboards reveal campaign effectiveness, customer acquisition costs, and return on investment across different channels. Operational data visualization can highlight efficiency bottlenecks, resource utilization patterns, and quality metrics that impact business performance.

The strategic value of business data visualization extends to all organizational levels. Executives use high-level dashboards to monitor overall performance and market position. Managers rely on departmental analytics to optimize team performance and resource allocation. Front-line employees use real-time visualizations to track daily goals and identify immediate improvement opportunities. This democratization of data insights enables data-driven decision-making throughout the organization.

Data Analysis and Insights

The patterns revealed in this visualization demonstrate the importance of systematic data analysis in understanding complex phenomena. By examining different data segments, time periods, and categorical breakdowns, we can identify trends that inform strategic planning and decision-making processes.

Statistical analysis of this data reveals variations across different dimensions that provide insights into underlying drivers and relationships. These patterns help identify areas of opportunity, potential risks, and key performance indicators that can guide future actions and resource allocation.

The analytical approach used in this visualization enables comparison across different categories, time periods, or geographic regions, revealing insights that support evidence-based decision-making. This type of analysis is essential for organizations seeking to optimize performance and understand complex market dynamics.

Significance and Applications

This data visualization has important implications for understanding trends and patterns that affect decision-making across multiple sectors. The insights derived from this analysis can inform policy development, business strategy, resource allocation, and operational improvements.

For analysts, researchers, and decision-makers, this type of data visualization provides essential insights for strategic planning and performance optimization. Whether addressing operational challenges, market analysis, or policy development, understanding data patterns helps create more effective strategies and solutions.

The broader significance lies in how this information contributes to our understanding of complex systems and relationships. This knowledge helps predict future trends, identify potential challenges, and develop more informed approaches to problem-solving and opportunity identification.