'Wow' in Taiwan as Well... Record-High Quarterly Revenue
Expansion of Investment in Developing Offerings... Enhanced Shareholder Returns
Coupang continued its strong growth in the first quarter of this year, overcoming unfavorable conditions such as a domestic market slump and political instability following the 12·3 Martial Law Incident. Overseas businesses, including the Rocket Delivery service launched in Taiwan and the global luxury goods platform Farfetch, which now operates in 190 countries, drove a rebound in performance. As a result, Coupang achieved its highest-ever quarterly revenue and saw a significant increase in operating profit. Coupang plans to use Taiwan as a new investment hub, aiming to build a logistics infrastructure comparable to that in Korea, expand its product categories, and generate stable profits.
'Wow' in Taiwan as Well... Record-High Quarterly Revenue
Coupang Inc., listed on the New York Stock Exchange and the parent company of Coupang, announced on the 7th that its consolidated operating profit for the first quarter of this year reached 233.7 billion won ($154 million, based on an average quarterly exchange rate of 1,452.66 won per dollar), a 340% increase compared to the same period last year. During the same period, revenue rose by 21% to 11.4876 trillion won ($7.908 billion). This marks the highest first-quarter revenue in the company’s history. However, due to the strong dollar effect, revenue in dollar terms decreased slightly from the previous quarter (11.1139 trillion won, $7.965 billion, average exchange rate 1,395.35 won).
Net profit for the first quarter also turned positive, reaching 165.6 billion won ($114 million), compared to a net loss of 31.8 billion won in the first quarter of last year. The operating margin improved to 2.0%, up from 0.6% a year earlier.
Performance was driven by a 78% year-on-year increase in revenue from developing offerings, including Farfetch (acquired early last year), Rocket Delivery in Taiwan, and Coupang Eats, which together generated 1.0578 trillion won ($1.038 billion). The adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) loss in these developing offerings was 244 billion won ($168 million), a slight decrease from the same period last year (a loss of 247 billion won). Profitability, which had declined following the $500 million (about 650 billion won) acquisition of Farfetch in December 2023, improved within a year, and the rapid growth of Rocket Delivery in Taiwan, launched in 2022, also contributed. In Taiwan, Coupang launched the paid 'Wow Membership' service in the first quarter of this year, offering benefits such as free Rocket Delivery and returns within 30 days for a monthly fee of 59 Taiwan dollars (about 2,600 won).
Bom Kim, Chairman of Coupang Inc., highlighted the success of the Taiwan business during the earnings conference call that day. He stated, "In the first quarter of this year, not only global brands such as Coca-Cola, Pepsi, P&G, and Unicharm but also local Taiwanese brands established direct relationships with us, resulting in nearly a 500% expansion in the range of products offered in Taiwan. Customer response in Taiwan has been positive, with increased revisit frequency and spending."
In fact, the Coupang application operating in Taiwan offers Rocket Delivery for products such as Coca-Cola and Pepsi. Major Taiwanese food conglomerates, including Uni-President, Wei Chuan, Kuang Chuan, and I-Mei, have also joined Coupang’s direct-purchase Rocket Delivery service. An industry insider explained, "In Korean terms, this is comparable to major food manufacturers such as CJ CheilJedang, Nongshim, and Binggrae partnering with Coupang." Additionally, Coupang expanded its categories by supplying popular local pet food brands such as Sheba and Fushou, including cat and dog food.
Expansion of Investment in Developing Offerings... Enhanced Shareholder Returns
Since last month, Coupang Inc. has been recruiting 'Coupang Friends' in Taiwan, similar to the directly employed delivery personnel known as 'Coupang Chingu' in Korea. The company has also reportedly established delivery camps in Kaohsiung, Taoyuan, and Taichung, serving as intermediaries between logistics centers and final delivery destinations, in addition to managing inbound and outbound logistics and on-site operations at logistics centers. Industry observers believe that Coupang has begun preliminary work to increase delivery speed and expand serviceable areas in Taiwan, as it did in Korea.
According to Taiwanese media outlets such as Liberty Times, Coupang Inc. has operated a second logistics center equipped with machine learning and artificial intelligence (AI)-based automation systems, following a local investment of 500 billion won, and is now pursuing the construction of a third fulfillment center. Chairman Kim explained, "We are laying the foundation for greater growth and profitability through investment in developing offerings. Continued investment in the Taiwanese market reflects our growing confidence in the local business environment." Farfetch has also begun restructuring to expand its business, aiming to provide the world's best luxury products and experiences to customers anywhere in the world.
A stable foundation was also established in the domestic market. The Product Commerce division of Coupang Inc. (including Rocket Delivery, Rocket Fresh, Rocket Growth, and Marketplace) recorded revenue of 9.9797 trillion won ($6.87 billion), a 16% increase from the same period last year. The number of active customers reached 23.4 million, up 9% from 21.5 million a year earlier. The number of active customers represents those who purchased Coupang products at least once in the first quarter of this year. Revenue per active customer also increased by 6% to 427,080 won ($294).
Chairman Kim attributed the positive customer response to the expansion of popular product categories and increased benefits. For example, Coupang diversified its offerings by adding luxury beauty brands such as Kiehl’s, Dolce & Gabbana, and Jo Malone to its luxury beauty service 'RLUX', launched in October last year. Popular brands such as Swarovski, Converse, Wedgwood, and Royal Copenhagen were also added to the regular Rocket Delivery lineup. As a result, the number of customers who purchased from more than nine categories in the first quarter increased by over 25%.
Meanwhile, Coupang Inc. announced that its board of directors recently approved a share repurchase program of up to $1 billion (about 1.4 trillion won) in Class A common stock. This buyback is nearly six times the $177.9 million repurchased in April last year, and is the largest since Coupang’s listing on March 11, 2021.
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