8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported) May 29, 2008

COSTCO WHOLESALE CORPORATION

(Exact name of registrant as specified in its charter)

Washington	0-20355	91-1223280
(State or other jurisdiction of incorporation)	(Commission File No.)	(I.R.S. Employer Identification No.)

999 Lake Drive

Issaquah, WA 98027

(Address of principal executive offices and zip code)

Registrant’s telephone number, including area code: 425-313-8100

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition

On May 29, 2008, the Company issued a press release containing its operating results for the third quarter (12 weeks) and first thirty-six weeks of fiscal 2008, ended May 11, 2008. A copy of the press release is included in Item 9.01.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits. The following exhibits are included in this report:

99.1. Press release dated May 29, 2008.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized, on May 29, 2008.

COSTCO WHOLESALE CORPORATION
By:	/s/ Richard A. Galanti
	Richard A. Galanti
	Executive Vice President and Chief Financial Officer

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EX-99.1

Exhibit 99.1

News from

COSTCO WHOLESALE CORPORATION REPORTS THIRD QUARTER AND

YEAR-TO-DATE OPERATING RESULTS FOR FISCAL 2008

ISSAQUAH, Wash., May 29, 2008 — Costco Wholesale Corporation (Nasdaq: COST) announced today its operating results for the third quarter (12 weeks) and first thirty-six weeks of fiscal 2008, ended May 11, 2008.

Net sales for the third quarter of fiscal 2008 increased 13% to $16.26 billion, from $14.34 billion during the third quarter of fiscal 2007. As previously reported, prior year third quarter sales results were negatively impacted by an increase in our sales returns reserve of $228.2 million. Excluding the sales returns reserve increase, the net sales increase would have been 12%.

Net sales for the first thirty-six weeks of fiscal 2008 increased 12% to $48.35 billion, from $43.00 billion during the first thirty-six weeks of fiscal 2007. Excluding the sales return reserve adjustments recorded in the second and third quarters of fiscal 2007, which aggregated to $452.6 million, the net sales increase would have been 11%.

Comparable sales for the fiscal third quarter (twelve weeks) and the first thirty-six weeks of fiscal 2008, both ended May 11, 2008, were as follows:

	12 Weeks		36 Weeks
US	6	%	5	%
International	16	%	17	%
Total Company	8	%	7	%

The U.S. comparable sales figure includes, among other things, the effect of recent gasoline price inflation, with the average sales price per gallon of gasoline up 20% year-over-year for the quarter. Excluding this, U.S. comparable sales in the third quarter would have been 4%. In addition, significantly stronger foreign exchange rates, primarily in Canada, positively impacted the third quarter’s international comparable sales results. On a local currency basis, international comparable sales increased 6% in the third quarter.

Net income for the third quarter of fiscal 2008 was $295.1 million, or $.67 per diluted share, compared to $224.0 million, or $.49 per diluted share, during the third quarter of fiscal 2007. Included in last year’s third quarter results was a $48.1 million pre-tax ($30.3 million after tax) charge primarily reflecting the reduced gross margin on estimated future returns recorded in the adjustment to the sales returns reserve noted above. Excluding this adjustment, last year’s third quarter net income would have been $254.3 million, or $.56 per diluted share.

Net income for the first thirty-six weeks of fiscal 2008 was $884.9 million, or $1.99 per diluted share, compared to net income for the first thirty-six weeks of fiscal 2007 of $710.4 million, or $1.54 per diluted share. Excluding the sales return reserve adjustments outlined above, as well as two additional non-recurring items recorded in the second quarter of fiscal 2007, which in total aggregated to $132.5 million pre-tax ($83.4 million after-tax), net income for the first thirty-six weeks of fiscal 2007 would have been $793.8 million or $1.72 per diluted share.

Costco currently operates 538 warehouses, including 394 in the United States and Puerto Rico, 75 in Canada, 19 in the United Kingdom, six in Korea, five in Taiwan, eight in Japan and 31 in Mexico. The Company also operates Costco Online, an electronic commerce web site, at www.costco.com and at www.costco.ca in Canada. The Company plans to open an additional nine to ten new warehouses (including the relocation of four warehouses to larger and better-located facilities) prior to the end of its 2008 fiscal year on August 31, 2008.

A conference call to discuss these third quarter results is scheduled for 8:00 a.m. (PT) today, May 29, 2008, and is available via a webcast on www.costco.com (click on Investor Relations and “Webcasts”).

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, conditions affecting the acquisition, development, ownership or use of real estate, actions of vendors, rising costs associated with employees (including health care and workers’ compensation costs), rising costs associated with the acquisition of merchandise (including the direct and indirect effects of the rising cost of petroleum-based products and fuel and energy costs), 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.

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 thousands, except per share data)

(unaudited)

	12 Weeks Ended						36 Weeks Ended
	May 11, 2008			May 13, 2007			May 11, 2008			May 13, 2007
REVENUE
Net sales	$	16,262,793		$	14,341,520		$	48,351,255		$	42,998,537
Membership fees		350,924			317,735			1,031,878			924,358
Total revenue		16,613,717			14,659,255			49,383,133			43,922,895
OPERATING EXPENSES
Merchandise costs		14,548,022			12,877,587			43,204,722			38,518,297
Selling, general and administrative		1,582,488			1,432,650			4,767,613			4,303,108
Preopening expenses		8,427			9,022			39,618			39,235
Provision for impaired assets and closing costs, net		9,205			931			6,419			8,722
Operating income		465,575			339,065			1,364,761			1,053,533
OTHER INCOME (EXPENSE)
Interest expense		(24,140	)		(26,016	)		(70,579	)		(31,776	)
Interest income and other		23,888			42,838			97,769			106,475
INCOME BEFORE INCOME TAXES		465,323			355,887			1,391,951			1,128,232
Provision for income taxes		170,257			131,901			507,054			417,882
NET INCOME	$	295,066		$	223,986		$	884,897		$	710,350
NET INCOME PER COMMON SHARE:
Basic	$	0.68		$	0.50		$	2.04		$	1.57
Diluted	$	0.67		$	0.49		$	1.99		$	1.54
Shares used in calculation (000’s)
Basic		433,678			445,471			434,515			451,744
Diluted		443,281			455,889			444,379			461,702
Dividends per share	$	0.16		$	0.145		$	0.45		$	0.405