Costco Wholesale Corporation
COST Consumer Defensive Q2 2025
Document 3625
Exhibit 99.1
Press Release
COSTCO WHOLESALE CORPORATION REPORTS SECOND QUARTER AND YEAR-TO-DATE OPERATING RESULTS FOR FISCAL 2025 AND FEBRUARY SALES RESULTS
ISSAQUAH, Wash., March 6, 2025 - Costco Wholesale Corporation (“Costco” or the “Company”) (Nasdaq: COST) today announced its operating results for the second quarter (twelve weeks) and the first 24 weeks of fiscal 2025, ended February 16, 2025.
Net sales for the quarter increased 9.1 percent, to $62.53 billion, from $57.33billion last year. Net sales for the first 24 weeks increased 8.3 percent, to $123.52 billion, from $114.05billion last year.
Comparable sales for the second quarter and first 24 weeks of fiscal 2025 were as follows:
| 12 Weeks | 12 Weeks | 24 Weeks | 24 Weeks | ||||||||||||||||||||
| Adjusted* | Adjusted* | ||||||||||||||||||||||
| U.S. | 8.3% | 8.6% | 6.8% | 7.9% | |||||||||||||||||||
| Canada | 4.6% | 10.5% | 5.2% | 8.6% | |||||||||||||||||||
| Other International | 1.7% | 10.3% | 3.2% | 8.7% | |||||||||||||||||||
| Total Company | 6.8% | 9.1% | 6.0% | 8.1% | |||||||||||||||||||
| E-commerce | 20.9% | 22.2% | 17.1% | 17.9% | |||||||||||||||||||
*Excluding the impacts from changes in gasoline prices and foreign exchange.
Net income for the quarter was $1,788 million, $4.02 per diluted share, compared to $1,743 million, $3.92 per diluted share, last year. Last year's second quarter net income was positively impacted by a $94 million ($0.21 per diluted share) tax benefit due to the deductibility of the $15 per share special dividend to the extent received by 401(k) plan participants. Net income for the first 24 weeks was $3.59billion, $8.06per diluted share, compared to $3.33 billion, $7.49per diluted share, last year.
For the four-week reporting month of February, ended March 2, 2025, the Company reported net sales of $19.81 billion, an increase of 8.8 percent from $18.21 billion last year. Net sales for the first 26 weeks were $133.36 billion, an increase of 8.3 percent from $123.15 billion last year.
Comparable sales for the February and year-to-date periods ended March 2, 2025, were as follows:
| 4 Weeks | 4 Weeks | 26 Weeks | 26 Weeks | ||||||||||||||||||||
| Adjusted* | Adjusted* | ||||||||||||||||||||||
| U.S. | 8.6% | 8.6% | 6.9% | 7.9% | |||||||||||||||||||
| Canada | 3.2% | 8.7% | 5.1% | 8.6% | |||||||||||||||||||
| Other International | -0.6% | 6.5% | 3.0% | 8.7% | |||||||||||||||||||
| Total Company | 6.5% | 8.3% | 6.1% | 8.1% | |||||||||||||||||||
| E-commerce | 19.0% | 20.2% | 16.9% | 17.7% | |||||||||||||||||||
*Excluding the impacts from changes in gasoline prices and foreign exchange.
Press Release
Costco currently operates 897 warehouses, including 617 in the United States and Puerto Rico, 109 in Canada, 41 in Mexico, 36 in Japan, 29 in the United Kingdom, 19 in Korea, 15 in Australia, 14 in Taiwan, seven in China, five in Spain, two in France, and one each in Iceland, New Zealand and Sweden. Costco also operates e-commerce sites in the U.S., Canada, the U.K., Mexico, Korea, Taiwan, Japan and Australia.
A conference call to discuss these results is scheduled for 2:00 p.m. (PT) today, March 6, 2025, and is available via a webcast on investor.costco.com (click on "Events & Presentations”).
Certain statements contained in this document 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. In some cases forward-looking statements can be identified because they contain words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “likely,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “target,” “will,” “would,” or similar expressions and the negatives of those terms. 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, inflation or deflation, the effects of competition and regulation, uncertainties in the financial markets, consumer and small business spending patterns and debt levels, breaches of security or privacy of member or business information, conditions affecting the acquisition, development, ownership or use of real estate, capital spending, actions of vendors, rising costs associated with employees (generally including health-care costs and wages), workforce interruptions, energy and certain commodities, geopolitical conditions (including tariffs), the ability to maintain effective internal control over financial reporting, regulatory and other impacts related to environmental and social matters, public-health related factors, and other risks identified from time to time in the Company’s public statements and reports filed with the Securities and Exchange Commission. Forward-looking statements speak only as of the date they are made, and the Company does not undertake to update these statements, except as required by law. Comparable sales and comparable sales excluding impacts from changes in gasoline prices and foreign exchange are intended as supplemental information and are not a substitute for net sales presented in accordance with U.S. GAAP.
CONTACTS: Costco Wholesale Corporation
David Sherwood, 425/313-8239
Josh Dahmen, 425/313-8254
Andrew Yoon, 425/313-6305
COST-Earn
COST-Sales
Press Release
COSTCO WHOLESALE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(dollars in millions, except per share data)
(unaudited)
| 12 Weeks Ended | 24 Weeks Ended | ||||||||||||||||||||||
| February 16, 2025 | February 18, 2024 | February 16, 2025 | February 18, 2024 | ||||||||||||||||||||
| REVENUE | |||||||||||||||||||||||
| Net sales | $ | 62,530 | $ | 57,331 | $ | 123,515 | $ | 114,048 | |||||||||||||||
| Membership fees | 1,193 | 1,111 | 2,359 | 2,193 | |||||||||||||||||||
| Total revenue | 63,723 | 58,442 | 125,874 | 116,241 | |||||||||||||||||||
| OPERATING EXPENSES | |||||||||||||||||||||||
| Merchandise costs | 55,744 | 51,140 | 109,853 | 101,597 | |||||||||||||||||||
| Selling, general and administrative | 5,663 | 5,240 | 11,509 | 10,598 | |||||||||||||||||||
| Operating income | 2,316 | 2,062 | 4,512 | 4,046 | |||||||||||||||||||
| OTHER INCOME (EXPENSE) | |||||||||||||||||||||||
| Interest expense | (36) | (41) | (73) | (79) | |||||||||||||||||||
| Interest income and other, net | 142 | 216 | 289 | 376 | |||||||||||||||||||
| INCOME BEFORE INCOME TAXES | 2,422 | 2,237 | 4,728 | 4,343 | |||||||||||||||||||
| Provision for income taxes | 634 | 494 | 1,142 | 1,011 | |||||||||||||||||||
| NET INCOME | $ | 1,788 | $ | 1,743 | $ | 3,586 | $ | 3,332 | |||||||||||||||
| NET INCOME PER COMMON SHARE: | |||||||||||||||||||||||
| Basic | $ | 4.03 | $ | 3.93 | $ | 8.08 | $ | 7.51 | |||||||||||||||
| Diluted | $ | 4.02 | $ | 3.92 | $ | 8.06 | $ | 7.49 | |||||||||||||||
| Shares used in calculation (000's): | |||||||||||||||||||||||
| Basic | 443,982 | 443,892 | 443,985 | 443,859 | |||||||||||||||||||
| Diluted | 444,886 | 444,754 | 444,888 | 444,579 | |||||||||||||||||||
Press Release
COSTCO WHOLESALE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(amounts in millions, except par value and share data)
(unaudited)
Subject to Reclassification
| February 16, 2025 | September 1, 2024 | ||||||||||
| ASSETS | |||||||||||
| CURRENT ASSETS | |||||||||||
| Cash and cash equivalents | $ | 12,356 | $ | 9,906 | |||||||
| Short-term investments | 802 | 1,238 | |||||||||
| Receivables, net | 3,060 | 2,721 | |||||||||
| Merchandise inventories | 18,754 | 18,647 | |||||||||
| Other current assets | 1,925 | 1,734 | |||||||||
| Total current assets | 36,897 | 34,246 | |||||||||
| OTHER ASSETS | |||||||||||
| Property and equipment, net | 29,809 | 29,032 | |||||||||
| Operating lease right-of-use assets | 2,531 | 2,617 | |||||||||
| Other long-term assets | 3,987 | 3,936 | |||||||||
| TOTAL ASSETS | $ | 73,224 | $ | 69,831 | |||||||
| LIABILITIES AND EQUITY | |||||||||||
| CURRENT LIABILITIES | |||||||||||
| Accounts payable | $ | 18,610 | $ | 19,421 | |||||||
| Accrued salaries and benefits | 5,150 | 4,794 | |||||||||
| Accrued member rewards | 2,491 | 2,435 | |||||||||
| Deferred membership fees | 2,824 | 2,501 | |||||||||
| Other current liabilities | 7,924 | 6,313 | |||||||||
| Total current liabilities | 36,999 | 35,464 | |||||||||
| OTHER LIABILITIES | |||||||||||
| Long-term debt, excluding current portion | 5,755 | 5,794 | |||||||||
| Long-term operating lease liabilities | 2,284 | 2,375 | |||||||||
| Other long-term liabilities | 2,609 | 2,576 | |||||||||
| TOTAL LIABILITIES | 47,647 | 46,209 | |||||||||
| COMMITMENTS AND CONTINGENCIES | |||||||||||
| EQUITY | |||||||||||
Preferred stock $0.005 par value; 100,000,000 shares authorized; no shares issued and outstanding | — | — | |||||||||
Common stock $0.005 par value; 900,000,000 shares authorized; 443,730,000 and 443,126,000 shares issued and outstanding | 2 | 2 | |||||||||
| Additional paid-in capital | 8,047 | 7,829 | |||||||||
| Accumulated other comprehensive loss | (2,242) | (1,828) | |||||||||
| Retained earnings | 19,770 | 17,619 | |||||||||
| TOTAL EQUITY | 25,577 | 23,622 | |||||||||
| TOTAL LIABILITIES AND EQUITY | $ | 73,224 | $ | 69,831 | |||||||
Press Release
COSTCO WHOLESALE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(amounts in millions)
(unaudited)
Subject to Reclassification
| 24 Weeks Ended | |||||||||||
| February 16, 2025 | February 18, 2024 | ||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||
| Net income | $ | 3,586 | $ | 3,332 | |||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | 1,100 | 1,015 | |||||||||
| Non-cash lease expense | 137 | 148 | |||||||||
| Stock-based compensation | 614 | 580 | |||||||||
| Other non-cash operating activities, net | (79) | (7) | |||||||||
Changes in working capital | 650 | 314 | |||||||||
| Net cash provided by operating activities | 6,008 | 5,382 | |||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||||
| Purchases of short-term investments | (345) | (719) | |||||||||
| Maturities of short-term investments | 752 | 1,029 | |||||||||
| Additions to property and equipment | (2,401) | (2,071) | |||||||||
| Other investing activities, net | (13) | 9 | |||||||||
| Net cash used in investing activities | (2,007) | (1,752) | |||||||||
| CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||||
| Repayments of short-term borrowings | (389) | (409) | |||||||||
| Proceeds from short-term borrowings | 370 | 383 | |||||||||
| Proceeds from issuance of long-term debt | — | 498 | |||||||||
| Tax withholdings on stock-based awards | (390) | (292) | |||||||||
| Repurchases of common stock | (412) | (322) | |||||||||
| Cash dividend payments | (515) | (8,012) | |||||||||
| Financing lease payments and other financing activities, net | (98) | (96) | |||||||||
| Net cash used in financing activities | (1,434) | (8,250) | |||||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS | (117) | 15 | |||||||||
| Net change in cash and cash equivalents | 2,450 | (4,605) | |||||||||
| CASH AND CASH EQUIVALENTS BEGINNING OF YEAR | 9,906 | 13,700 | |||||||||
| CASH AND CASH EQUIVALENTS END OF PERIOD | $ | 12,356 | $ | 9,095 | |||||||
Document 3625
2nd Quarter FY 2025 Supplemental Information 1
$62.5B Net Sales +9.1% Growth +6.8% Comparable Sales +9.1% Adjusted Comparable Sales1 +5.7% Comparable Traffic +20.9% E-Comm Comparable Sales +22.2% Adjusted E-Comm Comparable Sales2 Q2 Highlights - Sales 1 - Excluding impacts from changes in gasoline prices and foreign exchange 2 - E-commerce Comparable Sales excluding impacts from FX 2 +1.0% Comparable Ticket +3.2% Adjusted Comparable Ticket1
Q2 Highlights – Sales - Segment Reporting 1 - Excluding impacts from changes in gasoline prices and foreign exchange Comp Sales US Canada Other International Total Company Sales +8.3% +4.6% +1.7% +6.8% Ticket +2.6% -1.1% -4.3% +1.0% Traffic +5.6% +5.8% +6.3% +5.7% 3 Adjusted Comp Sales1 US Canada Other International Total Company Sales +8.6% +10.5% +10.3% +9.1% Ticket +2.8% +4.4% +3.8% +3.2% Traffic +5.6% +5.8% +6.3% +5.7%
Q2 Highlights - Financial Performance Reported Ex Gas1 Reported Ex Gas1 Core +5bps +4bps Ops +7bps +8bps Other Bus +1bp 0bps Central 0bps 0bps LIFO -1bp 0bps Equity Comp 0bps 0bps Total +5bps +4bps Preopening +1bp +1bp Core on Core Sales: -8bps Total +8bps +9bps + = Favorable/lower, - = Unfavorable/higher Gross Margin 10.85% +5 bps vs. Q2 FY’24 +4 bps ex. gas impact SG&A 9.06% +8 bps vs. Q2 FY’24 +9 bps ex. gas impact Diluted EPS $4.02 +2.6% Growth* Net Income $1.79B +2.6% Growth* *- “Other” Items for the Quarter: - Last year’s results included a tax benefit of $94 million, or $0.21 per diluted share, related to the tax deductibility of the special dividend paid to 401(k) participants. - Excluding last year’s tax benefit, net income and diluted EPS growth were both +8.4%. - The translation of foreign earnings had a negative impact of -$57 million, or -$0.13 per diluted share, on net income. 4 1 – Excluding the impacts from changes in gasoline prices
+7.4% Membership Income Growth +9.4% Membership Income Growth ex-FX 90.5% Worldwide Membership Renewal Rate 93.0% US/CN Renewal Rate 78.4MM Paid Memberships +6.8% Growth 140.6MM Total Cardholders +6.6% Growth 36.9MM Executive Memberships 73.8% Penetration of Sales to Executive Members Q2 Highlights - Membership 5
+20.9% E-Comm Comparable Sales 1 - E-commerce Comparable Sales excluding impacts from FX +22.2% Adjusted E-Comm Comparable Sales1 Top Sales Categories: - Gold and Jewelry - Home Furnishings - Small Electrics - Hardware - Sporting Goods - Housewares - Toys Digital Metrics: - Site Traffic: +13% - Average Order Value: +10% - Costco Logistics Deliveries: +19% - 43M visits to the new warehouse tool on the app Q2 Highlights - Digital 6
Q4 FY’24 End FY’25 Q1 FY’25 Q2 Rest of FY (Estimated) FY’25 End (Estimated) US 614 2 1 12 629 Canada 108 1 - 2 111 Other International 168 3 - 4 175 Total 890 6 1 18 915 Q2 Highlights - Warehouse Expansion Pleasanton, California: 11/27/24 7
Q2 Highlights - New Member Values KS Diapers (improved and increased value) KS Vodka + Soda 8 Lowering Every Day Low Prices New Items KS Organic Peanut Butter 13% Reduction KS Tortilla Strips 12% Reduction KS French Fries 5lbs KS Unsalted Pistachios KS Refined Olive Oil 7% Reduction
Safe Harbor Certain statements contained in this document 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. In some cases forward-looking statements can be identified because they contain words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “likely,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “target,” “will,” “would,” or similar expressions and the negatives of those terms. 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, inflation or deflation, the effects of competition and regulation, uncertainties in the financial markets, consumer and small business spending patterns and debt levels, breaches of security or privacy of member or business information, conditions affecting the acquisition, development, ownership or use of real estate, capital spending, actions of vendors, rising costs associated with employees (generally including health-care costs and wages), workforce interruptions, energy and certain commodities, geopolitical conditions (including tariffs), the ability to maintain effective internal control over financial reporting, regulatory and other impacts related to environmental and social matters, public- health related factors, and other risks identified from time to time in the Company’s public statements and reports filed with the Securities and Exchange Commission. Forward-looking statements speak only as of the date they are made, and the Company does not undertake to update these statements, except as required by law. Comparable sales and comparable sales excluding impacts from changes in gasoline prices and foreign exchange are intended as supplemental information and are not a substitute for net sales presented in accordance with U.S. GAAP. 9