Costco Wholesale (COST) 10-Q 17 Mar 10 2010 Q2 Quarterly report Financial data

Statement Of Financial Position

Statement Of Financial Position Classified (USD $)
In Millions	6 Months Ended Feb. 14, 2010	12 Months Ended Aug. 30, 2009
CURRENT ASSETS
Cash and cash equivalents	$4,134	$3,157
Short-term investments	585	570
Receivables, net	951	834
Merchandise inventories	5,365	5,405
Deferred income taxes and other current assets	466	371
Total current assets	11,501	10,337
PROPERTY AND EQUIPMENT
Land	3,402	3,341
Buildings, leasehold and land improvements	8,869	8,453
Equipment and fixtures	3,436	3,265
Construction in progress	150	264
Property, Plant and Equipment, Gross, Total	15,857	15,323
Less accumulated depreciation and amortization	(4,752)	(4,423)
Net property and equipment	11,105	10,900
OTHER ASSETS	760	742
TOTAL ASSETS	23,366	21,979
CURRENT LIABILITIES
Short-term borrowings	46	16
Accounts payable	5,598	5,450
Accrued salaries and benefits	1,569	1,418
Accrued sales and other taxes	345	302
Deferred membership fees	912	824
Current portion of long-term debt	45	80
Other current liabilities	1,350	1,191
Total current liabilities	9,865	9,281
LONG-TERM DEBT, excluding current portion	2,134	2,130
DEFERRED INCOME TAXES AND OTHER LIABILITIES	624	464
Total liabilities	12,623	11,875
COMMITMENTS AND CONTINGENCIES
EQUITY
Preferred stock $.005 par value; 100,000,000 shares authorized; no shares issued and outstanding	0	0
Common stock $.005 par value; 900,000,000 shares authorized; 440,379,000 and 435,974,000 shares issued and outstanding	2	2
Additional paid-in capital	4,009	3,811
Accumulated other comprehensive income	145	110
Retained earnings	6,495	6,101
Total Costco stockholders' equity	10,651	10,024
Noncontrolling interests	92	80
Total equity	10,743	10,104
TOTAL LIABILITIES AND EQUITY	$23,366	$21,979

1_Statement Of Financial Positi

Statement Of Financial Position Classified (Parenthetical) (USD $)
	Feb. 14, 2010	Aug. 30, 2009
Preferred stock, par value	0.005	0.005
Preferred stock, shares authorized	100,000,000	100,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	0.005	0.005
Common stock, shares authorized	900,000,000	900,000,000
Common stock, shares issued	440,379,000	435,974,000
Common stock, shares outstanding	440,379,000	435,974,000

Statement Of Income Alternative

Statement Of Income Alternative (USD $)
In Millions, except Share data in Thousands	3 Months Ended Feb. 14, 2010	3 Months Ended Feb. 15, 2009	6 Months Ended Feb. 14, 2010	6 Months Ended Feb. 15, 2009
REVENUE
Net sales	$18,356	$16,488	$35,278	$32,524
Membership fees	386	355	763	714
Total revenue	18,742	16,843	36,041	33,238
OPERATING EXPENSES
Merchandise costs	16,396	14,771	31,477	29,047
Selling, general and administrative	1,873	1,666	3,650	3,343
Preopening expenses	3	7	14	20
Provision for impaired assets and closing costs, net	0	1	2	8
Operating income	470	398	898	820
OTHER INCOME (EXPENSE)
Interest expense	(26)	(25)	(50)	(50)
Interest income and other, net	30	12	48	33
INCOME BEFORE INCOME TAXES	474	385	896	803
Provision for income taxes	169	142	321	294
Net income including noncontrolling interests	305	243	575	509
Net income attributable to noncontrolling interests	(6)	(4)	(10)	(7)
NET INCOME ATTRIBUTABLE TO COSTCO	$299	$239	$565	$502
NET INCOME PER COMMON SHARE ATTRIBUTABLE TO COSTCO:
Basic	0.68	0.55	1.29	1.16
Diluted	0.67	0.55	1.27	1.14
Shares used in calculation (000's)
Basic	439,786	433,476	438,475	432,963
Diluted	446,918	439,688	445,870	440,095
Dividends per share	0.18	0.16	0.36	0.32

Statement Of Cash Flows Indirec

Statement Of Cash Flows Indirect (USD $)
In Millions	6 Months Ended Feb. 14, 2010	6 Months Ended Feb. 15, 2009
CASH FLOWS FROM OPERATING ACTIVITIES
Net income including noncontrolling interests	$575	$509
Adjustments to reconcile net income including noncontrolling interests to net cash provided by operating activities:
Depreciation and amortization	369	316
Stock-based compensation	100	89
Undistributed equity earnings in joint ventures	(22)	(14)
Excess tax benefit on stock-based awards	(6)	(2)
Other non-cash items, net	(6)	45
Deferred income taxes	(3)	(7)
Change in receivables, other current assets, deferred membership fees, accrued and other current liabilities	186	41
Decrease (increase) in merchandise inventories	63	(120)
Increase (decrease) in accounts payable	104	(7)
Net cash provided by operating activities	1,360	850
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to property and equipment, net of $54 and $12 of non-cash capital expenditures in the first half of fiscal 2010 and 2009, respectively	(506)	(671)
Proceeds from the sale of property and equipment	2	4
Purchases of short-term investments	(628)	(1,001)
Maturities of short-term investments	579	1,020
Sales of investments	45	93
Other investing items, net	2	(4)
Net cash used in investing activities	(506)	(559)
CASH FLOWS FROM FINANCING ACTIVITIES
Change in bank checks outstanding	76	(61)
Repayments of short-term borrowings	(51)	(1,344)
Proceeds from short-term borrowings	80	1,359
Repayments of long-term debt	(39)	(2)
Cash dividend payments	(79)	(69)
Excess tax benefit on stock-based awards	6	2
Proceeds from stock-based awards, net	86	31
Repurchases of common stock	(6)	(67)
Other financing activities	38	0
Net cash provided by (used in) financing activities	111	(151)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS	12	(54)
Net increase in cash and cash equivalents	977	86
CASH AND CASH EQUIVALENTS BEGINNING OF YEAR	3,157	2,619
CASH AND CASH EQUIVALENTS END OF PERIOD	4,134	2,705
Cash paid during the period for:
Interest (reduced by $6 and $4 interest capitalized in the first half of fiscal 2010 and 2009, respectively)	53	52
Income taxes	294	176
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING ACTIVITIES:
Cash dividend declared, but not yet paid	79	69
Common stock issued upon conversion of 3.5% Zero Coupon Convertible Subordinated Notes	0	2
Property acquired under a capital lease	$80	$0

2_Statement Of Cash Flows Indir

Statement Of Cash Flows Indirect (Parenthetical) (USD $)
In Millions	6 Months Ended Feb. 14, 2010	6 Months Ended Feb. 15, 2009
Additions to property and equipment, non-cash capital expenditures	$54	$12
Interest, interest capitalized	$6	$4

Summary of Significant Accounti

Summary of Significant Accounting Policies
	6 Months Ended Feb. 14, 2010
Summary of Significant Accounting Policies	Note 1Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q for interim financial reporting pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). While these statements reflect all normal recurring adjustments that are, in the opinion of management, necessary for fair presentation of the results of the interim period, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles (GAAP) for complete financial statements. Therefore, the interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Companys annual report filed on Form 10-K for the fiscal year ended August30, 2009. The condensed consolidated financial statements include the accounts of Costco Wholesale Corporation, a Washington corporation, its wholly-owned subsidiaries, and subsidiaries in which it has a controlling interest (Costco or the Company). All material inter-company transactions among the Company and its subsidiaries have been eliminated in consolidation. Costco operates membership warehouses that offer low prices on a limited selection of nationally branded and select private label products in a wide range of merchandise categories in no-frills, self-service facilities. At February14, 2010, Costco operated 534 warehouses in 40 U.S. states and Puerto Rico (413 locations), nine Canadian provinces (77 locations), the United Kingdom (21 locations), Japan (nine locations), Korea (seven locations), Taiwan (six locations), and Australia (one location), as well as 32 locations in Mexico, through a 50%-owned joint venture. Reclassifications Certain reclassifications have been made to prior fiscal year amounts or balances to conform to the presentation in the current fiscal year. Additionally, as a result of the application of a new accounting pronouncement for noncontrolling interests in consolidated entities, discussed below in Recently Adopted Accounting Pronouncements, the Company: Reclassified to noncontrolling interests a component of total equity, $80 at August31, 2009, which was previously reported as minority interest on the Companys consolidated balance sheet, after the correction of an immaterial error of $6 relating to the noncontrolling interest component of accumulated other comprehensive income. A new subtotal, total Costco stockholders equity, refers to the equity attributable to stockholders of Costco; Reported as separate captions within the condensed consolidated statements of income, net income including noncontrolling interests, net income attributable to noncontrolling interests and net income attributable to Costco; and Utilized net income including noncontrolling interests as the starting point on the condensed consolidated statements of cash flows to reconcile net income including noncontrolling interests to cash flows from operating activities. These reclassifications did not have

Investments

Investments
	6 Months Ended Feb. 14, 2010
Investments	Note 2Investments The Companys major categories of investments have not changed from the annual reporting period ended August30, 2009. The Companys investments at February14, 2010 and August30, 2009, were as follows: February14, 2010: Cost Basis Unrealized Gains Unrealized Losses Recorded Basis Balance Sheet Classification Short-term Investments Other Assets Available-for-sale: Money market mutual funds $ 25 $ $ $ 25 $ 25 $ U.S. government and agency securities 408 4 412 412 Corporate notes and bonds 24 24 24 Asset and mortgage-backed securities 32 1 33 33 Total available-for-sale 489 5 494 494 Held-to-maturity: Certificates of deposit 91 91 91 Total investments $ 580 $ 5 $ $ 585 $ 585 $ August30, 2009: Cost Basis Unrealized Gains Unrealized Losses Recorded Basis Balance Sheet Classification Short-term Investments Other Assets Available-for-sale: Money market mutual funds $ 13 $ $ $ 13 $ 13 $ U.S. government and agency securities 400 3 403 403 Corporate notes and bonds 49 1 (1 ) 49 49 Asset and mortgage-backed securities 48 1 49 46 3 Total available-for-sale 510 5 (1 ) 514 511 3 Held-to-maturity: Certificates of deposit 59 59 59 Total investments $ 569 $ 5 $ (1 ) $ 573 $ 570 $ 3 The proceeds and gross realized gains and losses from sales of available-for-sale securities during the second quarter and the first half of 2010 and 2009 are provided in the following table: 12 Weeks Ended 24 Weeks Ended February14, 2010 February15, 2009 February14, 2010 February15, 2009 Proceeds $ 11 $ 43 $ 45 $ 93 Realized gains 1 1 3 2 Realized losses (1 ) (1 ) The following table presents the length of time available-for-sale securities were in continuous unrealized loss positions, but were not deemed to be other-than-temporarily impaired: August30, 2009 Lessthan12Months Greaterthanor Equalto12Months Gross Unrealized Holding Losses Fair Value Gross Unrealized Holding Losses Fair Value U.S. government and agency $ $ $ $ Corporate notes and bonds (1 ) 8 Asset and mortgage-backed securities $ $ $ (1 ) $ 8 As of February14, 2010, the Companys availa

Fair Value Measurement

Fair Value Measurement
	6 Months Ended Feb. 14, 2010
Fair Value Measurement	Note 3Fair Value Measurement The Company follows the authoritative guidance for fair value measurements relating to financial and nonfinancial assets and liabilities, including presentation of required disclosures, in its condensed consolidated financial statements. This guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. The guidance also establishes a fair value hierarchy, which requires maximizing the use of observable inputs when measuring fair value. The three levels of inputs that may be used are: Level1: Quoted market prices in active markets for identical assets or liabilities. Level2: Observable market based inputs or unobservable inputs that are corroborated by market data. Level3: Significant unobservable inputs that are not corroborated by market data. There have been no material changes to the valuations techniques utilized in the fair value measurement of assets and liabilities presented on the Companys balance sheet as disclosed in the Companys Form 10-K for the fiscal year ended August30, 2009. Assets and Liabilities Measured at Fair Value on a Recurring Basis The tables below present information as of February14, 2010 and August30, 2009, respectively, about the Companys financial assets and financial liabilities that are measured at fair value on a recurring basis, and indicates the fair value hierarchy of the valuation techniques utilized to determine such fair value: February14, 2010: Level 1 Level2 Level3 Assets (liabilities): Money market mutual funds $ 2,609 $ $ Investment in U.S. government and agency securities 412 Investment in corporate notes and bonds 22 2 Investment in asset and mortgage-backed securities 33 Forward foreign exchange contracts, in asset position(1) 2 Forward foreign exchange contracts, in liability position(1) (1 ) Total $ 2,609 $ 468 $ 2 August30, 2009: Level 1 Level2 Level3 Assets (liabilities): Money market mutual funds $ 1,597 $ $ Investment in U.S. government and agency securities 403 Investment in corporate notes and bonds 35 14 Investment in asset and mortgage-backed securities 37 12 Forward foreign exchange contracts, in asset position(1) 2 Forward foreign exchange contracts, in liability position(1) (4 ) Total $ 1,597 $ 473 $ 26 (1) The asset and the liability values are included in deferred income taxes and other current assets and other current liabilities, respectively, in the accompanying condensed consolidated balance sheets. See Note 1 for additional information on derivative instruments. The tables below provide a summary of the changes in fair value, including net transfers, of all financial as

Debt

Debt
	6 Months Ended Feb. 14, 2010
Debt	Note 4Debt At February14, 2010, the Company was in compliance with all restrictive covenants of its short-term borrowings. In November 2009, the Companys wholly-owned Japanese subsidiary paid the outstanding principal and interest balances related to the 0.88% Promissory notes due November 2009, originally issued in November 2002. During the second quarter and first half of 2010, $1 of the face value of the Companys 3.5% Zero Coupon Convertible Subordinated Notes (Zero Coupon Notes) was converted by note holders into 5,000 and 14,000 shares of common stock, respectively. During the second quarter and first half of 2009, $3 of the face value of the Companys Zero Coupon Notes was converted by note holders into 70,000 and 77,000 shares of common stock, respectively. These amounts differ from those in the supplemental disclosure of non-cash items in the condensed consolidated statements of cash flows due to the related discount and issuance costs. The carrying value and estimated fair value of long-term debt consisted of the following: February14, 2010 August30, 2009 Carrying Value Fair Value(1) Carrying Value Fair Value(1) 5.50% Senior Notes due March 2017 (2017 Senior Notes) $ 1,096 $ 1,220 $ 1,096 $ 1,213 5.30% Senior Notes due March 2012 (2012 Senior Notes) 899 970 899 973 Zero Coupon Notes 32 53 32 44 Other long-term debt 152 153 183 185 Total $ 2,179 $ 2,396 $ 2,210 $ 2,415 (1) The fair value of the Companys long-term debt is based on quoted market prices, as applicable.

Equity and Comprehensive Income

Equity and Comprehensive Income (Loss)
	6 Months Ended Feb. 14, 2010
Equity and Comprehensive Income (Loss)	Note 5Equity and Comprehensive Income (Loss) Dividends The Companys current quarterly cash dividend rate is $0.18 per share. On January28, 2010, the Board of Directors declared a quarterly cash dividend of $0.18 per share to shareholders of record on February12, 2010. The dividend was paid on February26, 2010. Stock Repurchase Programs The Companys stock repurchase activity during the second quarter and first half of 2010 and 2009 is summarized in the following table: Shares Repurchased (000s) Average Priceper Share Total Expenditure Second quarter of 2010 250 $ 58.89 $ 15 First half of 2010 250 58.89 15 Second quarter of 2009 $ $ First half of 2009 845 65.32 55 These amounts differ from the stock repurchase balances in the condensed consolidated statements of cash flows to the extent that repurchases had not settled at the end of the quarter. The remaining amount available for stock repurchases under the approved plans was approximately $1,987 at February14, 2010. Purchases are made from time-to-time as conditions warrant in the open market or in block purchases, and pursuant to share repurchase plans under SEC Rule 10b5-1. Repurchased shares are retired. From time to time, the Company purchases shares in the open market for the purpose of gifting common stock rewards to employees. In the second quarter of 2010, the Company purchased a nominal amount of shares, at an average price of $58.37. In the first half of 2010, the Company purchased 8,000 shares, at an average price of $58.50. This program is separate from the Companys publicly announced stock repurchase program discussed above. Components of Equity and Comprehensive Income (Loss) The Company reports its noncontrolling interests in consolidated subsidiaries as a component of equity separate from the Companys equity. The accumulated other comprehensive income (loss) consists of foreign currency translation adjustments and unrealized gains and losses on investments and their related tax effects. The following tables show the changes in equity attributable to Costco and the noncontrolling interests of subsidiaries in which Costco has a majority, but not total ownership interest: Attributable toCostco Noncontrolling Interests Total Equity Equity at August30, 2009 $ 10,024 $ 80 $ 10,104 Comprehensive income: Foreign currency translation adjustment and other 34 2 36 Unrealized gain on short term investments, net of tax 1 1 Net income 565 10 575 Total comprehensive income 600 12 612 Stock options exercised and vesting of restricted stock units (RSUs), including income tax 100 100 Repurchase of common stock (15 ) (15 ) Stock-based compensation 100 100 Cash dividends (158 ) (158 ) Equity at February14, 2010 $ 10,651 $ 92 $ 10,743 Equity at August31, 2008 $ 9,

Stock-Based Compensation Plans

Stock-Based Compensation Plans
	6 Months Ended Feb. 14, 2010
Stock-Based Compensation Plans	Note 6Stock-Based Compensation Plans In the second quarter of 2010, the Fourth Restated 2002 Stock Incentive Plan was amended following shareholder approval and is now referred to as the Fifth Restated 2002 Stock Incentive Plan (Fifth Restated 2002 Plan). The Fifth Restated 2002 Plan authorizes the issuance of an additional 18,000,000 shares of common stock for future grants in addition to grants currently authorized. Each share issued in respect of stock units is counted as 1.75 shares toward the limit of shares available. The Company issues new shares of common stock upon exercise of stock options and vesting of RSUs. Summary of Stock Option Activity The following table summarizes stock option transactions during the first half of 2010: Shares (in000s) Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term (in years) Aggregate Intrinsic Value(1) Outstanding at August30, 2009 18,742 $ 40.17 Granted Exercised (3,013 ) 41.90 Forfeited or expired (4 ) 44.69 Outstanding at February14, 2010(2) 15,725 $ 39.83 3.73 $ 306 Exercisable at February14, 2010 13,949 $ 39.30 3.55 $ 279 (1) The difference between the original exercise price and market value of common stock at February 14, 2010. (2) Stock options generally vest over five years and have a ten-year term. The tax benefits realized and intrinsic value related to total stock options exercised during the first half of 2010 and 2009 are provided in the following table: 24 Weeks Ended February14, 2010 February15, 2009 Actual tax benefit realized for stock options exercised $ 18 $ 6 Intrinsic value of stock options exercised(1) $ 52 $ 16 (1) The difference between the original exercise price and market value of common stock measured at each individual exercise date. Summary of Restricted Stock Unit Activity At February14, 2010, 12,262,000 shares were available to be granted as RSUs to eligible employees and directors under the Fifth Restated 2002 Plan. The following awards were outstanding at the end of the first half of 2010: 8,888,000 time-based RSUs, which vest upon the achievement of continued employment over specified periods of time; 472,000 performance-based RSUs granted to certain executive officers of the Company. The performance targets have been met. Further vesting occurs upon achievement of continued employment over specified periods of time; and 305,000 performance-based RSUs to be granted to executive officers of the Company upon achievement of specified performance targets for fiscal 2010, as determined by the Compensation Committee of the Board of Directors, after the end of the fiscal year. These awards are included in the table below and the Company recognized compensation expense for these awards as it is currently deemed probable that the performance targets will be achieved. The following table summarizes RSU transactions during the first h

Net Income Per Common and Commo

Net Income Per Common and Common Equivalent Share
	6 Months Ended Feb. 14, 2010
Net Income Per Common and Common Equivalent Share	Note 7Net Income Per Common and Common Equivalent Share The following table shows the amounts used in computing net income attributable to Costco (net income) per share and the effect on income and the weighted average number of shares of dilutive potential common stock (shares in 000s): 12 Weeks Ended 24 Weeks Ended February14, 2010 February15, 2009 February14, 2010 February15, 2009 Net income available to common stockholders used in basic and diluted net income per common share $ 299 $ 239 $ 565 $ 502 Weighted average number of common shares used in basic net income per common share 439,786 433,476 438,475 432,963 Stock options and RSUs 6,182 4,763 6,440 5,649 Conversion of convertible notes 950 1,449 955 1,483 Weighted number of common shares and dilutive potential of common stock used in diluted net income 446,918 439,688 445,870 440,095 Anti-dilutive stock options and RSUs 1,764 10,173 1,839 4,656

Commitments And Contingencies

Commitments And Contingencies
	6 Months Ended Feb. 14, 2010
Commitments And Contingencies	Note 8Commitments And Contingencies Legal Proceedings The Company is involved from time to time in claims, proceedings and litigation arising from its business and property ownership. The Company is a defendant in the following matters, among others: Cases purportedly brought as class actions on behalf of certain present and former Costco managers in California, in which plaintiffs principally allege that they have not been properly compensated for overtime work. Scott M. Williams v. Costco Wholesale Corp., United States District Court (San Diego), Case No.02-CV-2003 NAJ (JFS); Greg Randall v. Costco Wholesale Corp., Superior Court for the County of Los Angeles, Case No. BC-296369. On February21, 2008 the court in Randall tentatively granted in part and denied in part plaintiffs motion for class certification. That order was finalized by the court on May13, 2008. The parties in Randall have agreed on a partial settlement of the action (resolving all claims except for the claim that the Company miscalculated pay), requiring a payment of up to $16 by the Company, which was substantially paid in the first quarter of fiscal 2010. The miscalculation claim from the Randall case was refiled as a separate action by stipulation, alleging that the Company miscalculated the rates of pay for all department and ancillary managers in California in violation of Labor Code Section515(d). On October2, 2009, the court granted the Companys motion for summary judgment, and that ruling has been appealed. Terry Head v. Costco Wholesale Corp., Superior Court for the County of Los Angeles, Case No. BC-409805. In the Williams action, the parties have achieved a settlement, subject to final court approval. On December26, 2007, another putative class action was filed, also principally alleging denial of overtime compensation. The complaint alleges misclassification of certain California managers. On May15, 2008, the court partially granted the Companys motion to dismiss the complaint, dismissing certain claims and refusing to expand the statute of limitations for the remaining claims. An answer to the complaint was filed on May27, 2008. Plaintiffs class certification motion is pending. Jesse Drenckhahn v. Costco Wholesale Corp., United States District Court (Los Angeles), Case No. CV08-1408 FMC (JMJ). A case purportedly brought as a class action on behalf of present and former hourly employees in California, in which the plaintiff principally alleges that the Companys routine closing procedures and security checks cause employees to incur delays that qualify as uncompensated working time and that deny them statutorily guaranteed meal periods and rest breaks. The complaint was filed on October 2, 2008, and the Companys motion to dismiss was partially granted. Discovery is ongoing. Anthony Castaneda v. Costco Wholesale Corp., Superior Court for the County of Los Angeles, Case No. BC-399302. On February 1, 2010, the court denied plaintiffs motion for class certification, and that ruling has been appealed. A similar purported class action was filed on May 15, 2009, on behalf of present and former hourly employees in California, claiming denial of wages and fal

Segment Reporting

Segment Reporting
	6 Months Ended Feb. 14, 2010
Segment Reporting	Note 9Segment Reporting The Company and its subsidiaries are principally engaged in the operation of membership warehouses in the United States, Canada, Japan, Australia, the United Kingdom, and through majority-owned subsidiaries in Taiwan and Korea and through a 50%-owned joint-venture in Mexico. The Companys reportable segments are based on managements organization of the operating segments for operational decisions and assessments of financial performance, which considers geographic locations. The investment in the Mexico joint-venture is only included in total assets under United States Operations in the table below, as it is accounted for under the equity method and its operations are not consolidated in the Companys financial statements. The accounting policies of the segments are the same as those described in the notes to the consolidated financial statements included in the Companys annual report filed on Form 10-K for the fiscal year ended August30, 2009, after considering newly adopted accounting pronouncements described elsewhere herein. All inter-segment net sales and expenses have been eliminated in computing total revenue and operating income. UnitedStates Operations(1) Canadian Operations Other International Operations Total Twelve Weeks Ended February14, 2010 Total revenue $ 14,371 $ 2,835 $ 1,536 $ 18,742 Operating income 313 104 53 470 Depreciation and amortization 147 24 14 185 Capital expenditures, net 131 30 32 193 Twelve Weeks Ended February15, 2009 Total revenue $ 13,491 $ 2,155 $ 1,197 $ 16,843 Operating income 302 52 44 398 Depreciation and amortization 131 19 11 161 Capital expenditures, net 225 39 32 296 Twenty-Four Weeks Ended February14, 2010 Total revenue $ 27,592 $ 5,490 $ 2,959 $ 36,041 Operating income 579 216 103 898 Depreciation and amortization 291 49 29 369 Capital expenditures, net 374 80 52 506 Property and equipment, net 8,543 1,455 1,107 11,105 Total assets 18,240 2,867 2,259 23,366 Total equity 7,856 1,621 1,266 10,743 Twenty-Four Weeks Ended February15, 2009 Total revenue $ 26,427 $ 4,450 $ 2,361 $ 33,238 Operating income 582 161 77 820 Depreciation and amortization 256 38 22 316 Capital expenditures, net 489 89 93 671 Property and equipment, net 8,228 1,220 906 10,354 Total assets 16,761 2,202 1,774 20,737 Total equity 7,025 1,181 1,003 9,209 Year Ended August30, 2009 Total revenue $ 56,548 $ 9,737 $ 5,137 $ 71,422 Operating income 1,273 354 150 1,777 Depreciation and amortization 589 90 49 728 Capital expenditures, net 90

Document Information

Document Information
	6 Months Ended Feb. 14, 2010
Document Type	10-Q
Amendment Flag	false
Document Period End Date	2010-02-14

Entity Information

Entity Information
	6 Months Ended Feb. 14, 2010	Mar. 05, 2010
Trading Symbol	COST
Entity Registrant Name	COSTCO WHOLESALE CORP /NEW
Entity Central Index Key	0000909832
Current Fiscal Year End Date	--08-30
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		440,506,789