Press Release

Whole Foods Market Reports Second Quarter Results

Sales Increase 20%; Net Income Increases 22% and Diluted EPS Increase 17%; Company Updates Future Stock Option Strategy and Announces a Return to Previous Accounting Practice of Capitalizing Rent During Construction Period; Company will Restate Financials

May 4, 2005. Whole Foods Market, Inc. (NASDAQ: WFMI) today reported sales and earnings for the 12-week quarter ended April 10, 2005. For the second quarter, sales increased 20% to $1.1 billion. This increase was driven by 13% weighted average year-over-year square footage growth and comparable store sales growth of 11.6%. Sales in identical stores (excluding three relocated stores and two major store expansions) increased 10.2% for the quarter. Net income increased 22% to $42.0 million, and diluted earnings per share increased 17% to $0.61.

For the 28-week period ended April 10, 2005, sales increased 21% to $2.5 billion, with sales in comparable stores increasing 11.5% and sales in identical stores increasing 10.5%. Net income has increased 25% to $89.9 million, and diluted earnings per share increased 20% to $1.33.

The Company also announced in a separate release that based on new determinations by the SEC, the Company will return to and continue its previous practice of capitalizing rent during the construction period. The Company is thereby reducing the lease accounting charge for the first quarter of the current fiscal year from $0.04 to $0.02 per diluted share and the charge for fiscal year 2004 from $0.11 to $0.06 per diluted share. The remaining charge primarily reflects the additional pre-opening costs and depreciation of the asset resulting from rent allocated to the construction period. The Company's reported results for the second quarter and prior year reflect the return to this previous accounting practice.

Store Returns for the Quarter	Average Size	Average Comps	# of Comp Stores
Stores over eight years old	28,000	9.7%	69
Stores between five and eight years old	32,000	8.1%	30
Stores between two and five years old	32,000	12.8%	42
Stores less than two years old (including relocations)	40,000	24.8%	15
Stores in comparable store base	31,000	11.6%	156
All stores open at the end of the second quarter	32,000	-	168

"This quarter we produced an 11.6% comparable store sales increase, which was on top of our record-breaking 17.1% comparable store sales increase in the second quarter last year," said John Mackey, Chairman, Chief Executive Officer, and Co-Founder of Whole Foods Market. "We are very pleased with our performance year to date, particularly in light of our difficult year-over-year comparisons. Due to our strong sales growth, we are raising our comparable store sales guidance for the year to a range of 9% to 11% from 8% to 10%. We continue to expect diluted earnings per share growth to be lower than sales growth primarily due to the anticipated acceleration in new store openings."

In the quarter, gross profit increased 29 basis points to 35.7% of sales, and direct store expenses decreased three basis points to 25.5% of sales, resulting in store contribution of 10.2% of sales. For the 156 stores in the comparable store base, gross profit improved 56 basis points to 36.0% of sales, and direct store expenses improved 28 basis points to 25.3% of sales, resulting in an 84 basis point increase in store contribution to 10.7% of sales. General and administrative (G&A) expenses were relatively flat, increasing one basis point to 3.2% of sales.

The table below shows the Company's quarterly results compared to its historical four-year average results. While there may be more variability during a particular quarter, the Company points out the consistency of these line items as a percentage of sales over time.

Historical Performance	FY01	FY02	FY03	FY04	4-Year Average	1Q05	2Q05
Gross profit	34.7%	34.6%	34.2%	34.7%	34.6%	34.6%	35.7%
Direct store expenses	25.4%	25.2%	25.3%	25.6%	25.4%	25.5%	25.5%
Store contribution	9.3%	9.4%	9.0%	9.1%	9.2%	9.1%	10.2%
G&A	3.6%	3.6%	3.2%	3.1%	3.3%	3.0%	3.2%

Capital expenditures in the quarter were $74 million of which $51 million was for new store development. During the quarter, the Company produced cash flow from operations of $128 million and paid approximately $12 million to shareholders in quarterly dividends of $0.19 per share. Cash and cash equivalents, including restricted cash, were approximately $331 million at the end of the quarter, and total long-term debt was approximately $91 million.

On April 5, 2005, the Company announced a 32% increase in its quarterly dividend to $0.25 per share from $0.19 per share. On November 10, 2004, the Company announced a 27% increase in the quarterly dividend to $0.19 per share from $0.15 per share. The first $0.25 per share dividend was paid on April 25, 2005.

In the second quarter, the Company opened two new stores in Swampscott, MA and New York City, NY and relocated two stores in Austin, TX and Thousand Oaks, CA, ending the quarter with 168 stores totaling approximately 5.4 million square feet. The Company today opened its third store in Canada and expects to open two additional stores during the third quarter, including one relocation.

The Company is pleased to announce the recent signing of seven new store leases in San Francisco, CA; Naples, FL; Portland, ME; West Orange, NJ; Nashville, TN; Milwaukee, WI; and Vancouver, Canada. The following table provides additional information about the Company's store development pipeline.

Stores in Development	5/4/05	5/4/04	% Change
Number of stores in development	59	46	28%
Average size (gross square feet)	51,300	46,400	11%
As a percentage of existing store average size	160%	152%	-
Total square footage under development	3,059,000	2,174,000	41%
As a percentage of existing square footage	57%	46%	-

Future Growth Goals and Updated Guidance

The Company has a stated long-term growth goal of $10 billion in sales by the year 2010. For fiscal year 2005, the Company expects sales growth at the higher end of its previously stated 15% to 20% range. The Company expects comparable store sales growth to be in the range of 9% to 11% versus its previously stated range of 8% to 10%, with weighted average square footage growth of approximately 15% based on the opening of 15 to 18 new stores, including three relocations. The Company continues to expect diluted earnings per share growth for the year to be lower than sales growth primarily due to the anticipated acceleration in new store openings, which is expected to result in pre-opening expenses in the range of $9 million to $11 million for the remainder of the year. In addition, the Company continues to expect new stores may have some negative impact on store contribution, as new stores generally have lower gross margins and higher direct store expenses than more mature stores. Due to the remaining charges for changes in lease accounting regarding the recognition of rent expense and depreciation for certain leases, the Company expects store contribution to be approximately $2 million to $4 million lower for the remainder of the year than it would have been under the original method of accounting. The Company expects G&A expenses for the remainder of the fiscal year to be higher as a percentage of sales as compared to the prior year, primarily due to the relocation of the Company's headquarters in January which is expected to add approximately $4 million in G&A expenses annually. Capital expenditures are expected to be in the range of $300 million to $320 million.

Stock Option Strategy Update

In December the Financial Accounting Standards Board (FASB) finalized Statement 123R, Share-based Payment, which requires all companies to expense share-based payments, including stock options, at fair value.

Though not retroactive, the charge to earnings resulting from this new rule includes the impact of stock options granted in prior years, since the expense is recognized over the vesting period of the options, which for the Company has been four years. Even if the Company never granted another option after today, it would still have stock option expense until all past option grants were fully vested. In order to prevent this "overhang" from past option grants impacting future income statements, the Company previously announced its intention, absent FASB 123R being overruled by Congress, to accelerate the vesting of all outstanding stock options sometime prior to July 4, 2005, the date the new rules were to be effective for the Company.

In view of the recent action by the SEC to delay the effective date of option expensing, the Company now expects to begin expensing options in the first quarter of fiscal year 2006. Consequently, it plans to delay the acceleration of vesting of all outstanding options until September unless there are further delays and/or the rule is overturned.

This accelerated vesting of options will create a one-time, mostly non-cash charge in the fourth fiscal quarter of this year of approximately $10 million, consisting of the estimated increase in value to the option holders caused by the acceleration plus accrual of certain payroll taxes that will be due upon exercise of the options. The actual amount of the expense will vary based on the closing stock price at the date of the acceleration.

The Company's current intention is to keep its broad-based stock option program in place, but going forward it will limit the number of shares granted in any one year so that net income dilution from equity-based compensation expense (EBCE) will not exceed 10% in future years. The EBCE will ramp up beginning in the first quarter of fiscal year 2006 until it reaches 10% of net income in fiscal year 2010.

The Company believes this strategy is best aligned with its stakeholder philosophy because it limits future earnings dilution from options while at the same time retains the broad-based stock option plan which it believes is important to team member morale and to its unique corporate culture and its success.

Supplemental Information: The following pie chart depicts net income and certain expense categories, including salaries and benefits, as a percentage of sales for the twelve weeks ended April 10, 2005.

The following constitutes a "Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995. Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties, which could cause our actual results to differ materially from those described in the forward looking statements. These risks include but are not limited to general business conditions, the timely development and opening of new stores, the integration of acquired stores, the impact of competition, and other risks detailed from time to time in the Company's SEC reports, including the report on Form 10K for the fiscal year ended September 26, 2004. The Company does not undertake any obligation to update forward-looking statements.

Whole Foods Market, Inc.
Consolidated Statements of Operations (unaudited)
(In thousands, except per share amounts)

	Twelve weeks ended				Twenty-eight weeks ended
	April 10, 2005		April 10, 2005		April 10, 2005		April 11, 2004
Sales	$	1,085,158	$	902,141	$	2,453,486	$	2,020,289
Cost of goods sold and occupancy costs	697,686		582,597		1,593,172		1,316,318
Gross profit	387,472		319,544		860,314		703,971
Direct store expenses	276,834		230,441		625,878		>513,606
Store contribution	110,638		89,103		234,436		190,365
General and administrative expenses	34,773		28,783		75,174		64,652
Pre-opening and relocation costs	7,581		2,605		10,714		4,522
Operating income	68,284		57,715		148,548		121,191
Other income (expense): Interest expense	(342)		(1,859)		(2,050)		(4,337)
Investment and other income	2,113		1,503		3,307		2,967
Income before income taxes	70,055		57,359		149,805		119,821
Provision for income taxes	28,023		22,944		59,922		47,929
Net income	$	42,032	$	34,415	$	89,883	$	71,892
Basic earnings per share	$	0.65	$	0.56	$	1.41	$	1.19
Weighted average shares outstanding	64,751		61,035		63,633		60,620
Diluted earnings per share	$	0.61	$	0.53	$	1.33	$	1.11
Weighted average shares outstanding, diluted basis	69,544		67,579		69,241		67,039
Dividends per share	$	0.25	$	0.15	$	0.44	$	0.30

A reconciliation of the numerators and denominators of the basic and diluted earnings per share calculations follows (in thousands):

	Twelve weeks ended				Twenty-eight weeks ended
	April 10, 2005		April 10, 2005		April 10, 2005		April 11, 2004
Net income (numerator for basic earnings per share)	$	42,032	$	34,415	$	89,883	$	71,892
Interest on 5% zero coupon convertible subordinated   debentures, net of income taxes	565		1,084		1,958		2,506
Adjusted net income (numerator for diluted earnings   per share)	$	42,597	$	35,499	$	91,841	$	74,398
Weighted average common shares outstanding (denominator   for basic earnings per share)	64,751		61,035		63,633		60,620
Potential common shares outstanding:   Assumed conversion of 5% zero coupon convertible   subordinated debentures	1,663		3,281		2,471		3,282
Assumed exercise of stock options	3,130		3,263		3,137		3,137
Weighted average common shares outstanding and   potential additional common shares outstanding   (denominator for diluted earnings per share)	69,544		67,579		69,241		67,039
Basic earnings per share	$	0.65	$	0.56	$	1.41	$	1.19
Diluted earnings per share	$	0.61	$	0.53	$	1.33	$	1.11

Whole Foods Market, Inc.
Consolidated Balance Sheets
April 10, 2005 (unaudited) and September 26, 2004
(In thousands)

Assets	2005		2004
Current assets: Cash and cash equivalents	$	297,913	$	198,377
Restricted cash	33,398		23,160
Trade accounts receivable	60,947		64,972
Merchandise inventories	157,706		152,912
Prepaid expenses and other current assets	36,482		16,702
Deferred income taxes	29,449		29,449
Total current assets	615,895		485,572
Property and equipment, net of accumulated depreciation and amortization	999,525		904,825
Goodwill	112,500		112,186
Intangible assets, net of accumulated amortization	22,821		24,831
Other assets	5,939		20,302
Total assets	$	1,756,680	$	1,547,716
Liabilities And Shareholders' Equity	2005		2004
Current liabilities: Current installments of long-term debt and capital lease obligations	$	5,977	$	5,973
Trade accounts payable	101,712		90,751
Accrued payroll, bonus and other benefits due team members	116,727		100,536
Dividends payable	16,410		9,361
Other accrued expenses	158,052		128,329
Total current liabilities	398,878		334,950
Long-term debt and capital lease obligations, less current installments	84,554		164,770
Deferred rent liability	82,201		70,067
Other long-term liabilities	1,404		1,581
Deferred income taxes	7,736		7,693
Total liabilities	574,773		579,061
Shareholders' equity: Common stock, no par value, 150,000 shares authorized; 65,573 and 62,771 shares issued; 65,333 and 62,407 shares outstanding in 2005 and 2004 respectively	685,568		535,107
Accumulated other comprehensive income	3,514		2,053
Retained earnings	492,825		431,495
Total shareholders' equity	1,181,907		968,655
Commitments and contingencies
Total liabilities and shareholders' equity	$	1,756,680	$	1,547,716

Whole Foods Market, Inc.
Consolidated Statements of Cash Flows (unaudited)
(In thousands)

Twenty-eight weeks ended
April 10, 2005			April 11, 2004
Cash flows from operating activities Net income	$	89,883	$	71,892
Adjustments to reconcile net income to net cash provided   by operating activities:     Depreciation and amortization	71,634		59,973
Loss on disposition of assets	1,307		1,482
Deferred income tax expense (benefit)	43		(1,402)
Tax benefit related to exercise of employee stock options	27,685		18,563
Interest accretion on long-term debt	3,191		4,069
Deferred rent	8,788		5,289
Other	2,550		2,357
Net change in current assets and liabilities:         Trade accounts receivable	3,708		(14,270)
Merchandise inventories	(6,544)		(19,785)
Prepaid expense and other current assets	(5,278)		(4,119)
Trade accounts payable	10,961		13,521
Accrued payroll, bonus and other benefits due team members	16,191		19,682
Other accrued expenses	29,267		44,127
Net cash provided by operating activities	253,386		201,379
Cash flows from investing activities Development costs of new store locations	(110,316)		(84,750)
Other property, plant and equipment expenditures	(52,391)		(58,612)
Acquisition of intangible assets	-		(49)
Increase in restricted cash	(10,238)		(17,904)
Increase in notes receivable			(13,500)
Payment for purchase of acquired entities, net of cash acquired	-		(20,392)
Other investing activities	-		1,815
Net cash used in investing activities	(172,945)		(193,392)
Cash flows from financing activities Dividends paid	(21,504)		(9,079)
Issuance of common stock	40,704		31,801
Payments on long-term debt and capital lease obligations	(105)		(97)
Net cash provided by financing activities	19,095		22,625
Net increase in cash and cash equivalents	99,536		30,612
Cash and cash equivalents at beginning of period	198,377		165,779
Cash and cash equivalents at end of period	$	297,913	$	196,391
Supplemental disclosure of cash flow information:     Interest paid	$	634	$	1,000
Federal and state income taxes paid	$	13,946	$	19,675
Non-cash transactions:     Common stock issued in connection with acquisition	$	-	$	16,375

About Whole Foods Market: Founded in 1980 in Austin, Texas, Whole Foods Market® is a Fortune 500 company and the largest natural and organic foods retailer. The Company had sales of $5.6 billion in fiscal year 2006 and currently has 188 stores in the United States, Canada and the United Kingdom.

The following constitutes a "Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995. Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties, which could cause our actual results to differ materially from those described in the forward looking statements. These risks include but are not limited to general business conditions, the timely development and opening of new stores, the impact of competition, and other risks detailed from time to time in the Company's SEC reports, including the reports on Form 10-K and 10-K/A Amendment No. 1 for the fiscal year ended September 25, 2005. The Company does not undertake any obligation to update forward-looking statements.