Company: COST
Filing Date: 2025-12-17
Form Type: 10-Q
Source: 0000909832-25-000169
Chunk: 47

Company: COSTCO WHOLESALE CORP /NEW
Filing Date: 2025-12-17
Form: 10-Q
Item: Item 8
Chunk 47
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 and two basis points, respectively. SG&A expenses as a percentage of net sales were higher in our U.S. segment and lower in our Canadian and Other International segments.

Interest Expense12 Weeks EndedNovember 23,2025November 24,2024Interest expense$35 $37 

Interest expense is primarily related to Senior Notes and financing leases.

Interest Income and Other, Net12 Weeks EndedNovember 23,2025November 24,2024Interest income$122 $96 Foreign-currency transaction gains, net25 43 Other, net8 8 Interest income and other, net$155 $147 

The increase in interest income in the first quarter of 2026 was due to higher cash balances, partially offset by lower interest rates. Foreign-currency transaction gains, net, include mark-to-market adjustments for forward foreign-exchange contracts and revaluation or settlement of monetary assets and liabilities by our Canadian and Other International operations. See Derivatives and Foreign Currency sections in Item 8, Note 1 of our Annual Report on Form 10-K, for the fiscal year ended August 31, 2025.

Provision for Income Taxes 12 Weeks Ended November 23,2025November 24,2024Provision for income taxes$582 $508 Effective tax rate22.5 %22.0 %

The effective tax rate for the first quarter of 2026 and 2025 was favorably impacted by discrete tax benefits of $72 and $100 related to stock compensation.

LIQUIDITY AND CAPITAL RESOURCES

The following table summarizes our significant sources and uses of cash and cash equivalents:

12 Weeks EndedNovember 23,2025November 24,2024Net cash provided by operating activities$4,688 $3,260 Net cash used in investing activities(1,398)(985)Net cash used in financing activities(1,167)(1,193)

Our primary sources of liquidity are cash flows from operations, cash and cash equivalents, and short-term investments. Cash and cash equivalents and short-term investments were $17,183 and $15,284 at November 23, 2025, and August 31, 2025. Of these balances, unsettled credit and debit card receivables 

22

represented approximately $3,095 and $2,670 at November 23, 2025, and August 31, 2025. These receivables generally settle within four days.

Material