Sign up to myFT Daily Digest to be the first to know about Coupang news.
Shares in Coupang, the SoftBank-backed ecommerce group, plunged in after-hours trading as it reported wider quarterly losses after a fire destroyed the company’s biggest logistics centre in South Korea.
The 12 per cent fall to $32.63 took Coupang’s New York Stock Exchange-listed shares to their lowest point since May. The stock is down almost half from its opening price of $63.50 after Coupang’s $4.6bn initial public offering in March, which was the biggest international listing in the US since Chinese internet group Alibaba raised $25bn in 2014.
The company, which boasts that almost all of its deliveries are made on the same or next day, reported net losses of $518.6m in the three months to June, a more than fivefold increase from the second quarter of last year.
Despite that hit, founder and chief executive Bom Kim struck an upbeat tone with investors, pointing out that Coupang had notched its 15th consecutive quarter of revenue growth exceeding 50 per cent on a constant currency basis.
“We believe we are the largest ecommerce player, growing at a multiple of one of the biggest and fastest-growing ecommerce opportunities in the world,” Kim said on an investor call after the earnings.
Stripping out the impact from the June fire, which killed a firefighter and prompted a wave of public complaints and boycotts in Seoul over Coupang’s handling of the incident, second-quarter losses more than doubled to $223.1m. The company noted that insurance proceeds from the fire had not been recognised.
Coupang, which has benefited from booming demand during the Covid-19 pandemic, notched record revenues of $4.48bn in the second quarter, up from $4.2bn in the first quarter and 71 per cent higher versus the same period a year ago.
Net revenue per active customer, which the company refers to as a “key indicator” of its success, was $263 in the second quarter, compared with $262 in the first three months of the year and 36 per cent higher than the second quarter of 2020.
The number of Coupang’s active customers — defined as those who bought goods at least once during the quarter — was 17m in the three months to June, up from 16m in the first quarter and 13.5m in the same period a year earlier.
“We exist to deliver new moments of ‘wow’ for customers,” Kim said. “As we create these moments, we will continue to unlock a better world for every customer, merchant and employee we touch — leading all to wonder ‘how did we ever live without Coupang’.”
Coupang has faced a series of allegations related to labour problems, including claims of overwork from South Korean politicians and the family members of deceased employees and subcontractors.
The company has denied responsibility for the deaths of employees and allegations of tough labour conditions linked to its operations.
In its quarterly results, Coupang highlighted investments of more than $200m in worker safety initiatives.
However, Wi Jong-hyun, an economics professor at Chung-Ang University in Seoul, said that the allegations raised concerns about a lack of internal controls at Coupang and had damaged consumer trust.
Chun Myung-hoon, an analyst at Nice Investors Service, a local credit rating agency, said Coupang’s profitability would remain under pressure while the company focused on expanding its scale.
Your crucial guide to the billions being made and lost in the world of Asia Tech. A curated menu of exclusive news, crisp analysis, smart data and the latest tech buzz from the FT and Nikkei