Costco Wholesale Corporation Reports Second Quarter and Year-to-Date Operating Results for Fiscal 2024 and February Sales Results

- NASDAQ Companies
  0

ISSAQUAH, Wash., March 07, 2024 (GLOBE NEWSWIRE) — 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 2024, ended February 18, 2024.

Net sales for the quarter increased 5.7 percent, to $57.33 billion, from $54.24 billion last year. Net sales for the first 24 weeks increased 5.9 percent, to $114.05 billion, from $107.68 billion last year.

Net sales for the Company were negatively impacted by approximately one and one-half percent for the quarter and by approximately one-half percent for the first 24 weeks of fiscal 2024 from the shift of the fiscal calendar, as a result of the fifty-third week last year.

The following comparable sales data reflect comparable locations year-over-year and comparable retail weeks.

Comparable sales for the second quarter and first 24 weeks of fiscal 2024 were as follows:

  12 Weeks   12 Weeks   24 Weeks   24 Weeks
      Adjusted*       Adjusted*
U.S. 4.3%   4.8%   3.1%   3.7%
Canada 9.2%   9.0%   7.8%   8.6%
Other International 8.6%   8.2%   9.8%   7.7%
               
Total Company 5.6%   5.8%   4.7%   4.8%
               
E-commerce 18.4%   18.2%   12.2%   12.0%

*Excluding the impacts from changes in gasoline prices and foreign exchange.

Net income for the quarter was $1,743 million, $3.92 per diluted share, compared to $1,466 million, $3.30 per diluted share, last year. This 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 $3.33 billion, $7.49 per diluted share, compared to $2.83 billion, $6.37 per diluted share, last year.

For the four-week reporting month of February, ended March 3, 2024, the Company reported net sales of $18.21 billion, an increase of 6.9 percent from $17.04 billion last year. Net sales for the first 26 weeks were $123.15 billion, an increase of 6.1 percent from $116.06 billion last year.

Comparable sales for the periods ended March 3, 2024, were as follows:

  4 Weeks   4 Weeks   26 Weeks   26 Weeks
      Adjusted*       Adjusted*
U.S. 3.4%   4.1%   3.2%   3.8%
Canada 8.4%   8.3%   7.9%   8.7%
Other International 10.2%   11.3%   9.8%   7.8%
               
Total Company 5.0%   5.6%   4.7%   4.9%
               
E-commerce 16.2%   16.0%   12.6%   12.4%

*Excluding the impacts from changes in gasoline prices and foreign exchange.

Costco currently operates 875 warehouses, including 603 in the United States and Puerto Rico, 108 in Canada, 40 in Mexico, 33 in Japan, 29 in the United Kingdom, 18 in Korea, 15 in Australia, 14 in Taiwan, six in China, four 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 United Kingdom, Mexico, Korea, Taiwan, Japan and Australia.

A conference call to discuss these results is scheduled for 2:00 p.m. (PT) today, March 7, 2024, 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), energy and certain commodities, geopolitical conditions (including tariffs and the Ukraine conflict), the ability to maintain effective internal control over financial reporting, regulatory and other impacts related to climate change, 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 GAAP.

CONTACTS:   Costco Wholesale Corporation
    David Sherwood, 425/313-8239
    Josh Dahmen, 425/313-8254
    Andrew Yoon, 425/313-6305

COST-Earn
COST-Sales

COSTCO WHOLESALE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(dollars in millions, except per share data)
(unaudited)
       
  12 Weeks Ended   24 Weeks Ended
  February 18,
2024		   February 12,
2023		   February 18,
2024		   February 12,
2023
REVENUE              
Net sales $ 57,331     $ 54,239     $ 114,048     $ 107,676  
Membership fees   1,111       1,027       2,193       2,027  
Total revenue   58,442       55,266       116,241       109,703  
OPERATING EXPENSES              
Merchandise costs   51,140       48,423       101,597       96,192  
Selling, general and administrative   5,240       4,940       10,598       9,857  
Operating income   2,062       1,903       4,046       3,654  
OTHER INCOME (EXPENSE)              
Interest expense   (41 )     (34 )     (79 )     (68 )
Interest income and other, net   216       114       376       167  
INCOME BEFORE INCOME TAXES   2,237       1,983       4,343       3,753  
Provision for income taxes   494       517       1,011       923  
NET INCOME $ 1,743     $ 1,466     $ 3,332     $ 2,830  
               
NET INCOME PER COMMON SHARE:              
Basic $ 3.93     $ 3.30     $ 7.51     $ 6.37  
Diluted $ 3.92     $ 3.30     $ 7.49     $ 6.37  
               
Shares used in calculation (000s):              
Basic   443,892       443,877       443,859       443,857  
Diluted   444,754       444,475       444,579       444,503  
                               
COSTCO WHOLESALE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(amounts in millions, except par value and share data)
(unaudited)
Subject to Reclassification
 
  February 18, 2024   September 3, 2023
ASSETS      
CURRENT ASSETS      
Cash and cash equivalents $ 9,095     $ 13,700  
Short-term investments   1,226       1,534  
Receivables, net   2,779       2,285  
Merchandise inventories   17,075       16,651  
Other current assets   1,971       1,709  
Total current assets   32,146       35,879  
OTHER ASSETS      
Property and equipment, net   27,601       26,684  
Operating lease right-of-use assets   2,740       2,713  
Other long-term assets   3,836       3,718  
TOTAL ASSETS $ 66,323     $ 68,994  
LIABILITIES AND EQUITY      
CURRENT LIABILITIES      
Accounts payable $ 17,494     $ 17,483  
Accrued salaries and benefits   4,801       4,278  
Accrued member rewards   2,268       2,150  
Deferred membership fees   2,541       2,337  
Current portion of long-term debt   1,080       1,081  
Other current liabilities   6,504       6,254  
Total current liabilities   34,688       33,583  
OTHER LIABILITIES      
Long-term debt, excluding current portion   5,865       5,377  
Long-term operating lease liabilities   2,488       2,426  
Other long-term liabilities   2,522       2,550  
TOTAL LIABILITIES   45,563       43,936  
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; 443,549,000 and 442,793,000 shares issued and outstanding   2       2  
Additional paid-in capital   7,620       7,340  
Accumulated other comprehensive loss   (1,842 )     (1,805 )
Retained earnings   14,980       19,521  
TOTAL EQUITY   20,760       25,058  
TOTAL LIABILITIES AND EQUITY $ 66,323     $ 68,994  
               
COSTCO WHOLESALE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(amounts in millions)
(unaudited)
Subject to Reclassification
   
  24 Weeks Ended
  February 18, 2024   February 12, 2023
CASH FLOWS FROM OPERATING ACTIVITIES      
Net income $ 3,332     $ 2,830  
Adjustments to reconcile net income to net cash provided by operating activities:      
Depreciation and amortization   1,015       917  
Non-cash lease expense   148       216  
Stock-based compensation   580       549  
Impairment of assets and other non-cash operating activities, net   (7 )     145  
Changes in working capital   314       1,145  
Net cash provided by operating activities   5,382       5,802  
CASH FLOWS FROM INVESTING ACTIVITIES      
Purchases of short-term investments   (719 )     (396 )
Maturities and sales of short-term investments   1,029       512  
Additions to property and equipment   (2,071 )     (1,947 )
Other investing activities, net   9       (34 )
Net cash used in investing activities   (1,752 )     (1,865 )
CASH FLOWS FROM FINANCING ACTIVITIES      
Repayments of short-term borrowings   (409 )     (520 )
Proceeds from short-term borrowings   383       479  
Proceeds from issuance of long-term debt   498       —  
Tax withholdings on stock-based awards   (292 )     (302 )
Repurchases of common stock   (322 )     (284 )
Cash dividend payments   (8,012 )     (400 )
Financing lease payments   (94 )     (158 )
Other financing activities, net   (2 )     (30 )
Net cash used in financing activities   (8,250 )     (1,215 )
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS   15       45  
Net change in cash and cash equivalents   (4,605 )     2,767  
CASH AND CASH EQUIVALENTS BEGINNING OF YEAR   13,700       10,203  
CASH AND CASH EQUIVALENTS END OF YEAR $ 9,095     $ 12,970  


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