Costco Wholesale (COST) 8-K Costco Wholesale Corporation Reports Third Quarter and Year-to-date Operating Results for Fiscal 2015

Exhibit 99.1

COSTCO WHOLESALE CORPORATION REPORTS THIRD QUARTER AND YEAR-TO-DATE OPERATING RESULTS FOR FISCAL 2015

ISSAQUAH, Wash., May 27, 2015 – Costco Wholesale Corporation (“Costco” or the “Company”) (Nasdaq: COST) announced today its operating results for the third quarter (twelve weeks) and first thirty-six weeks of fiscal 2015, ended May 10, 2015.

Net sales for the quarter increased one percent, to $25.52 billion, from $25.23 billion last year. Net sales for the first thirty-six weeks increased four percent, to $78.67 billion, from $75.46 billion last year.

Comparable sales for the twelve-week and thirty-six-week periods were as follows:

	12 Weeks			36 Weeks
U.S.		1	%		4	%
International		-6	%		-2	%
Total		-1	%		2	%

Comparable sales for these periods, excluding negative impacts from gasoline price deflation and foreign exchange, were as follows:

`	12 Weeks			36 Weeks
U.S.		5	%		7	%
International		7	%		7	%
Total		6	%		7	%

Net income for the quarter was $516 million, or $1.17 per diluted share, compared to $473 million, or $1.07 per diluted share, last year. Net income for the thirty-six weeks was $1.61 billion, or $3.64 per diluted share, compared to $1.36 billion, or $3.07 per diluted share, last year. Net income for the thirty-six-week period was positively impacted by a $57 million ($0.13 per diluted share) tax benefit in connection with a second quarter special cash dividend to the extent received by the Company 401(k) plan participants; and was negatively impacted by a $14 million ($0.03 per diluted share) second quarter tax charge relating to an ongoing income tax matter.

Costco currently operates 673 warehouses, including 474 in the United States and Puerto Rico, 89 in Canada, 35 in Mexico, 26 in the United Kingdom, 20 in Japan, 11 in Korea, 10 in Taiwan, seven in Australia and one in Spain. The Company plans to open up to an additional 15 new warehouses (including one relocation to a larger and better-located facility) prior to the end of its fiscal year on August 30, 2015. Costco also operates electronic commerce web sites in the U.S., Canada, the United Kingdom and Mexico.

A conference call to discuss these third quarter operating results is scheduled for 8:00 a.m. (PT) tomorrow, May 28, 2015, and is available via a webcast on www.costco.com (click on Investor Relations and “Play Webcast”).

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. 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, 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 (including health care costs), energy and certain commodities, geopolitical conditions, 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 we do not undertake to update these statements, except as required by law.

CONTACTS: Costco Wholesale Corporation

Richard Galanti, 425/313-8203, Bob Nelson, 425/313-8255, Jeff Elliott, 425/313-8264

COSTCO WHOLESALE CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(dollars in millions, except per share data)

(unaudited)

	12 Weeks Ended						36 Weeks Ended
	May 10, 2015			May 11, 2014			May 10, 2015			May 11, 2014
REVENUE
Net sales	$	25,517		$	25,233		$	78,673		$	75,457
Membership fees		584			561			1,748			1,660
Total revenue		26,101			25,794			80,421			77,117
OPERATING EXPENSES
Merchandise costs		22,687			22,554			69,969			67,421
Selling, general and administrative		2,579			2,487			7,946			7,519
Preopening expenses		14			16			38			48
Operating income		821			737			2,468			2,129
OTHER INCOME (EXPENSE)
Interest expense		(31	)		(25	)		(84	)		(78	)
Interest income and other, net		9			12			64			60
INCOME BEFORE INCOME TAXES		799			724			2,448			2,111
Provision for income taxes		280			245			817			728
Net income including noncontrolling interests		519			479			1,631			1,383
Net income attributable to noncontrolling interests		(3	)		(6	)		(21	)		(22	)
NET INCOME ATTRIBUTABLE TO COSTCO	$	516		$	473		$	1,610		$	1,361
NET INCOME PER COMMON SHARE ATTRIBUTABLE TO COSTCO:
Basic	$	1.17		$	1.08		$	3.66		$	3.10
Diluted	$	1.17		$	1.07		$	3.64		$	3.07
Shares used in calculation (000’s)
Basic		440,070			439,446			439,733			439,058
Diluted		443,132			442,720			442,721			442,651
Cash dividends declared per common share	$	0.400		$	0.355		$	6.110		$	0.975

COSTCO WHOLESALE CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(dollars in millions)

(unaudited)

Subject to Reclassifications

	May 10, 2015		August 31, 2014
ASSETS
Cash and cash equivalents	$	5,063	$	5,738
Short-term investments		1,742		1,577
Receivables, net		1,195		1,148
Merchandise inventories		8,869		8,456
Deferred income taxes and other current assets		765		669
Total current assets		17,634		17,588
Property and equipment, net		15,083		14,830
Other assets		774		606
TOTAL ASSETS	$	33,491	$	33,024
LIABILITIES AND EQUITY
Accounts payable	$	8,895	$	8,491
Accrued salaries and benefits		2,160		2,231
Deferred membership fees		1,336		1,254
Other current liabilities		4,345		2,436
Total current liabilities		16,736		14,412
Long-term debt, excluding current portion		4,826		5,093
Deferred income taxes and other liabilities		1,115		1,004
Total liabilities		22,677		20,509
Total Costco stockholders’ equity		10,587		12,303
Noncontrolling interests		227		212
Total equity		10,814		12,515
TOTAL LIABILITIES AND EQUITY	$	33,491	$	33,024