Company: COST
Filing Date: 2025-03-13
Form Type: 10-Q
Source: 0000909832-25-000015
Chunk: 53

Company: COSTCO WHOLESALE CORP /NEW
Filing Date: 2025-03-13
Form: 10-Q
Item: Item 8
Chunk 53
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 merchandise sales (rather than total net sales), decreased eight basis points. The decrease was primarily due to increased supply chain costs to support higher inventory levels and certain mix changes in our non-food categories. This measure eliminates the impact of changes in sales penetration and gross margin from our warehouse ancillary and other businesses.

Gross margin percentage on a segment basis, when expressed as a percentage of the segment's own sales and excluding the impact of changes in gasoline prices on net sales (segment gross margin 

22

percentage), increased in our U.S. segment, which performed similarly to the consolidated results above. Our Canadian segment gross margin percentage decreased, primarily due to decreases in core merchandise categories, partially offset by warehouse ancillary and other businesses. Gross margin decreased in our Other International segment, primarily due to decreases in core merchandise categories.

Year-to-date Results

Gross margin percentage increased 14 basis points. Excluding the impact of gasoline price deflation on net sales, gross margin percentage was 10.98%, an increase of six basis points. This increase was positively impacted by 14 basis points in our core merchandise categories, primarily due to our co-branded credit card program. This increase was partially offset by eight basis points due to warehouse ancillary and other businesses, primarily gasoline, partially offset by e-commerce. Changes in foreign currencies relative to the U.S. dollar negatively impacted gross margin by approximately $158, compared to the first half of 2024, attributable to our Other International and Canadian operations.

The gross margin in core merchandise categories, when expressed as a percentage of core merchandise sales (rather than total net sales), decreased three basis points. The decrease was primarily due to non-foods, partially offset by fresh foods and foods and sundries.

Segment gross margin percentage increased in all segments. Our U.S. segment performed similarly to the consolidated results above. Our Canadian and Other International segments gross margin increased, primarily due to increases in core merchandise categories.

Selling, General and Administrative Expenses12 Weeks Ended24 Weeks EndedFebruary 16,2025February 18,2024February 16,2025February 18,2024SG&A expenses$5,663 $5,240 $11,509 $10,598 SG&A expenses as a percentage of net sales9.06 %9.14 %9.32 %9.29 %

Quarterly Results

SG&A expenses as a percentage of net sales decreased eight basis points. SG&A expenses as a percentage of net sales excluding the impact of