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Coupang sales rise, but operating loss deepens on margin pressure
Revenue climbed 4% year over year to $8.9 billion, while gross margin fell 188 basis points to 28.2%.
Coupang reported results for the quarter ended June 30, showing revenue growth alongside a sharp profitability decline, according to Yahoo Finance. Net revenues rose 4% year over year to $8.9 billion, or 10% on a constant currency basis, while the company swung to an operating loss of $556 million from a profit a year earlier.
About $410 million of the operating loss came from administrative fines in South Korea, but performance still weakened even after excluding the impact. Operating results fell $295 million short of the prior year, as gross profit dropped 3% year over year to $2.5 billion and gross margin slipped 188 basis points to 28.2%.
Coupang’s newer businesses grew faster than its core marketplace, with its Developing Offerings segment posting net revenues of $1.4 billion, up 20% year over year on a reported basis and 24% on a constant currency basis. Its adjusted EBITDA loss narrowed by $16 million from a year ago, while Product Commerce, the core retail and grocery business, reached 24.7 million active customers, up 3% year over year.
Despite the customer growth, profitability and cash generation deteriorated. Inside Product Commerce, adjusted EBITDA fell $281 million year over year to $382 million, with margin down 390 basis points to 5.1%, and company-wide adjusted EBITDA margin came in at 1.8%, down 318 basis points. Trailing twelve-month operating cash flow declined $484 million to $1.4 billion, and free cash flow dropped to $105 million, down $679 million from a year earlier.