Costco Earnings Drop on Charge

Costco Wholesale Corp. last week posted a rare decline in net income after taking a charge for the third quarter. The club-store operator posted net income of $224 million for the 12-week period, which ended May 13, a decline of about 5% from year-ago levels. The company took a pre-tax charge of $48.1 million in the period, reflecting reduced gross margin related to estimated

ISSAQUAH, Wash. — Costco Wholesale Corp. here last week posted a rare decline in net income after taking a charge for the third quarter.

The club-store operator posted net income of $224 million for the 12-week period, which ended May 13, a decline of about 5% from year-ago levels. The company took a pre-tax charge of $48.1 million in the period, reflecting reduced gross margin related to estimated future merchandise returns.

Comparable-store sales for the quarter were

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