Coupang reports first profit ever, trouncing consensus

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Coupang reports first profit ever, trouncing consensus

Coupang trucks are parked in a parking lot in Seoul. [YONHAP]

Coupang trucks are parked in a parking lot in Seoul. [YONHAP]

 
Coupang made money for the first time ever.
 
Net profit was $91 million in the third quarter, compared to a net loss of $324 million in the year-earlier period.
 
The New York Stock Exchange-listed company trounced analyst estimates, earning $0.05 per share versus a consensus of a $0.03 loss.
 
"We achieved another milestone this quarter," CFO Gaurav Anand said.
 
Revenue was $5.1 billion, up 10 percent on year and in line with analyst expectations of $5.15-billion. It also achieved its first operating profit, logging $77.4 million compared to an operating loss of $314 million the previous year.
 
"Much of the recent improvement has been the result of investments in technology, infrastructure, supply chain optimization and process innovation," Anand said.
 
Developing offerings  —  which includes Coupang Eats, Coupang Play, fintech and advertising  — generated sales of $154 million, down 6 percent on year. On a constant-currency basis, sales in this category were up 10 percent.
 
"Our focus on Coupang Eats has been on creating a profitable foundation, and the dramatic improvements in economics in the last few quarters are reflected in the gross profit improvement," CEO Bom Kim said. "We are also excited in customer engagement we are seeing in Coupang Play, fintech and international."
 
"We will continue to invest with discipline starting with small investments, testing rigorously, and allocating more capital in opportunities that maximize our cash flow."
 
Coupang reported sales of $4.9 billion in its product commerce segment, up 10 percent on year.
 
The company said its next milestone is to achieve positive free cash flow, although a timeline wasn't given. Cash flow was a negative $194 million in the third quarter.
 
The e-commerce company had 18 million active customers in the third quarter, up 7 percent on year. Despite the on-year increase, growth is slowing, increasing 0.6 percent on-quarter.
 
Net revenue per active customer was $284, up 3 percent on year. On an on-quarter basis, the figure rose 0.7 percent.
 
In after-hours trading following the earnings release, Coupang shares rose 8.04 percent to $17.60. Coupang went public last year at $35.00 and opened on Mar. 11 at $63.50.
 
 
 

BY LEE TAE-HEE [lee.taehee2@joongang.co.kr]
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