Coupang posts 1st quarterly loss in two years; revenue soars

Coupang Inc., South Korea's e-commerce behemoth, posted its first quarterly loss in two years after booking the hefty fine imposed in relation to its alleged search algorithm manipulation and losses from Farfetch, a London-based online retailer for luxury goods, it acquired in January.

Coupang's operating loss came in at 34.2 billion won ($25 million) in the second quarter of this year, snapping its gaining streak in the past seven quarters. In third quarter of 2022, it achieved its first quarterly profit of 103.7 billion won.

In the second quarter ending in June, its net loss reached $105 million.

In comparison, its second-quarter revenue soared 30% to 10.04 trillion won ($7.3 billion) from 7.67 trillion won in the same period of last year. It marked the first time its quarterly revenue exceeded 10 trillion won.

Coupang attributed the operating loss to the $121 million fine slapped by the Korea Fair Trade Commission in June and restructuring costs for Farfetch. It booked the penalty as selling, general and administive expenses.

In July, the anti-trust body said Coupang had allegedly manipulated search algorithms to place private labels and products it directly sold at the top of its search rankings.

Excluding those expenses, its net income would have come to $124 million in the second quarter, said Coupang.

The number of active customers for Coupang’s core businesses, including Rocket Delivery and Rocket Fresh services, was 21.7 million as of the end of June, a 12% increase from the year prior.

Average sales per customer was $309, a 5% increase year-on-year.

Write to Sun A Lee at suna@hankyung.com