News Release

Costco Wholesale Corporation Reports Third Quarter and Year-to-Date Operating Results for Fiscal 2002
Net sales for the third quarter of fiscal 2002 increased 12% to $8.44 billion from $7.56 billion during the third quarter of fiscal 2001. On a comparable warehouse basis, that is warehouses open at least a year, net sales increased 6%.
Net income for the third quarter of fiscal 2002 increased 24% to $130.4 million, or $.28 per share (diluted), from $105.3 million, or $.23 per share (diluted), during the third quarter of fiscal 2001.
Net sales for the first thirty-six weeks of fiscal 2002 increased 12% to $25.94 billion from $23.22 billion during the first thirty-six weeks of fiscal 2001. Comparable warehouse sales during the first thirty-six weeks of fiscal 2002 increased 6% over the prior year's level.
Net income for the first thirty-six weeks of fiscal 2002 increased 10% to $452.6 million, or $.96 per diluted share, compared to net income for the first thirty-six weeks of fiscal 2001 of $411.4 million, or $.88 per diluted share.
Costco currently operates 389 warehouses, including 285 in the United States, 60 in Canada, 14 in the United Kingdom, five in Korea, three in Taiwan, two in Japan and 20 in Mexico. The Company also operates Costco Online, an electronic commerce web site, at www.costco.com. The Company plans to open seven additional new warehouses (including the relocation of two warehouses to larger and better-located facilities) prior to the end of its 2002 fiscal year on September 1, 2002, and an additional 16 to 18 new warehouses (including one relocation of an existing warehouse to a larger and better-located facility) prior to the end of calendar year 2002.
A conference call to discuss these third quarter results is scheduled for 8:00 a.m. (PDT) today, May 30, 2002, and is available via a webcast on www.costco.com (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.
COSTCO WHOLESALE CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF INCOME (dollars in thousands, except per share data) (unaudited) 12 Weeks Ended 36 Weeks Ended -------------------------- ------------------------- May 12, 2002 May 13, 2001 May 12, 2002 May 13, 2001 ------------ ------------ ------------ ------------ REVENUE Net sales $ 8,436,807 $ 7,563,494 $ 25,942,296 $ 23,222,453 Membership fees and other 179,940 155,401 523,856 440,029 ------------ ------------ ------------ ------------ Total revenue 8,616,747 7,718,895 26,466,152 23,662,482 OPERATING EXPENSES Merchandise costs 7,583,251 6,825,636 23,229,678 20,815,238 Selling, general and administrative 806,617 705,858 2,432,740 2,128,396 Preopening expenses 6,077 12,751 36,827 43,003 Provision for impaired assets and closing costs 4,500 -- 16,050 2,000 ------------ ------------ ------------ ------------ Operating income 216,302 174,650 750,857 673,845 OTHER INCOME (EXPENSE) Interest expense (8,643) (9,023) (21,080) (24,889) Interest income and other 9,624 9,801 24,527 36,635 ------------ ------------ ------------ ------------ INCOME BEFORE INCOME TAXES 217,283 175,428 754,304 685,591 Provision for income taxes 86,913 70,171 301,722 274,236 ------------ ------------ ------------ ------------ NET INCOME $ 130,370 $ 105,257 $ 452,582 $ 411,355 ============ ============ ============ ============ NET INCOME PER COMMON AND COMMON EQUIVALENT SHARE: Basic $ .29 $ .23 $ 1.00 $ .92 ============ ============ ============ ============ Diluted $ .28 $ .23 $ .96 $ .88 ============ ============ ============ ============ Shares used in calculation (000's) Basic 454,272 450,195 453,047 448,886 Diluted 480,256 475,840 479,250 474,973CONTACT: Costco Wholesale Corporation Richard Galanti, 425/313-8203 Bob Nelson, 425/313-8255