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December 12, 2002 at 4:05 AM EST

Costco Wholesale Corporation Reports First Quarter Operating Results for Fiscal 2003

ISSAQUAH, Wash.--(BUSINESS WIRE)--Dec. 12, 2002--Costco Wholesale Corporation (Nasdaq: COST) announced today its operating results for the first quarter (12 weeks) of fiscal 2003, ended November 24, 2002.

Net sales for the first quarter of fiscal 2003 increased 9% to $9.01 billion from $8.30 billion during the first quarter of fiscal 2002. On a comparable warehouse basis, that is warehouses open at least a year, net sales increased 4%.

Net income for the first quarter of fiscal 2003 increased 12% to $145.7 million, or $.31 per share (diluted), from $129.7 million, or $.28 per share (diluted), during the first quarter of fiscal 2002.

Costco currently operates 411 warehouses, including 304 in the United States and Puerto Rico, 61 in Canada, 15 in the United Kingdom, five in Korea, three in Taiwan, three in Japan and 20 in Mexico. The Company also operates Costco Online, an electronic commerce web site, at The Company plans to open one additional new warehouse -- in Celaya, Mexico -- prior to the end of calendar year 2002.

A conference call to discuss these first quarter results is scheduled for 8:00 a.m. (PST) today, December 12, 2002, and is available via a webcast on (go to Customer Service, Investor Relations, Financial Releases and click on the "Live Webcast" icon).

Certain statements contained in this release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For these purposes, forward-looking statements are statements that address activities, events, conditions or developments that the Company expects, or anticipates may occur in the future. Such forward-looking statements involve risks and uncertainties that may cause actual events, results or performance to differ materially from those indicated by such statements. These risks and uncertainties include, but are not limited to, domestic and international economic conditions including exchange rates, the effects of competition and regulation, conditions affecting the acquisition, development, ownership or use of real estate, actions of vendors, and other risks identified from time to time in the Company's public statements and reports filed with the SEC.


             (dollars in thousands, except per share data)

                                              12 Weeks Ended
                                        November 24,   November 25,
                                            2002           2001
                                        -----------    -----------
  Net sales                             $ 9,010,571    $ 8,297,076
  Membership fees and other                 188,014        169,477
                                        -----------    -----------
    Total revenue                         9,198,585      8,466,553
  Merchandise costs                       8,048,897      7,434,397
  Selling, general and administrative       888,779        786,118
  Preopening expenses                        18,117         22,134
  Provision for impaired assets and
   closing costs                              5,000          8,550
                                        -----------    -----------
    Operating income                        237,792        215,354
  Interest expense                           (8,468)        (6,238)
  Interest income and other                   7,634          6,977
                                        -----------    -----------
INCOME BEFORE INCOME TAXES                  236,958        216,093
  Provision for income taxes                 91,229         86,437
                                        -----------    -----------
NET INCOME                              $   145,729    $   129,656
                                        ===========    ===========
  Basic                                 $      0.32    $      0.29
                                        ===========    ===========
  Diluted                               $      0.31    $      0.28
                                        ===========    ===========

Shares used in calculation (000's)
  Basic                                     455,570        451,990
  Diluted                                   478,857        477,395

CONTACT: Costco Wholesale Corporation Richard Galanti, 425/313-8203 Bob Nelson, 425/313-8255