Coupang(US:CPNG)2023-05-09 16:00Financial Performance - Total net revenues for Q1 2023 reached $5,800,530, a 13% increase from $5,116,686 in Q1 2022[85] - Gross profit for Q1 2023 was $1,419,927, representing a 36% increase from $1,043,406 in Q1 2022[85] - Net income for Q1 2023 was $90,855, compared to a net loss of $(209,294) in Q1 2022, marking a significant turnaround[85] - Net retail sales amounted to $5,204,800, reflecting a 14% growth compared to $4,556,107 in the same period last year[104] - The company reported a net income of $90.9 million for Q1 2023, a significant improvement of $300.1 million compared to a net loss of $209.3 million in Q1 2022[125] - Net cash provided by operating activities for Q1 2023 was $501.3 million, an increase of $556.2 million from a cash outflow of $54.9 million in the same period last year[125] Customer Metrics - Active Customers increased to 19,010 as of March 31, 2023, up from 18,112 a year earlier[86] - Total net revenues per Active Customer rose to $305 in Q1 2023, compared to $283 in Q1 2022, indicating improved customer engagement[86] Cash Flow and Liquidity - Free cash flow for Q1 2023 was $406,746, a recovery from a negative free cash flow of $(289,600) in Q1 2022[99] - As of March 31, 2023, the company had total cash and cash equivalents of $4.1 billion, with $2.4 billion held by foreign subsidiaries[123] - As of March 31, 2023, there were no balances outstanding on the company's revolving credit facilities, indicating strong liquidity management[147] - Coupang, Inc. had cash, cash equivalents, and restricted cash totaling $4.1 billion as of March 31, 2023[146] Operational Efficiency - Adjusted EBITDA for Q1 2023 was $240,919, compared to an adjusted EBITDA loss of $(90,872) in Q1 2022[85] - The adjusted EBITDA margin improved to 4.2% in Q1 2023, compared to a negative margin of (1.8)% in Q1 2022[120] - Cost of sales as a percentage of revenue decreased from 79.6% in Q1 2022 to 75.5% in Q1 2023, indicating improved operational efficiencies[111] - Total operating costs and expenses rose to $5,693,755, a 7% increase from $5,322,391 in Q1 2022[102] Segment Performance - The segment adjusted EBITDA for Product Commerce was $288,370, a significant increase from $2,877 in Q1 2022[85] - Developing Offerings segment reported an adjusted EBITDA loss of $(47,451), an improvement from $(93,749) in Q1 2022[85] - Product Commerce segment net revenues increased by 15% to $5,658,349, driven by growth in Active Customers and total net revenues per Active Customer[108] - Developing Offerings segment reported a decline in revenues by 21% to $142,181, attributed to a decrease in Active Customers using the Eats offering[109] Interest and Taxation - Interest income for Q1 2023 increased by $28 million compared to the prior year, primarily due to higher interest rates on deposits[114] - The effective income tax rate for Q1 2023 was 26.6%, up from (0.1)% in the prior year, reflecting stronger operating results[116] Future Commitments and Investments - The company has remaining capital expenditure commitments of $429 million as of March 31, 2023, related to new construction contracts for fulfillment centers expected to be completed over the next three years[124] - The company plans to invest several billion dollars over the next several years to expand its infrastructure and workforce-related costs[124] - The company expects future expenditures for infrastructure and workforce-related costs to exceed several billion dollars over the next several years[124] Risk Management - A hypothetical 10% adverse change in average exchange rates would have resulted in a decline in total net revenues of approximately $514 million for Q1 2023[149] - Coupang, Inc. does not currently engage in derivatives or other financial instruments to hedge foreign currency risk, but may consider it in the future[150] - The company places cash and cash equivalents with financial institutions of high credit quality to manage credit risk[151] - Interest rate risk arises primarily from undrawn revolving credit facilities and variable rate borrowings, which expose the company to variability in cash flows[146] - Management evaluates and approves credit standards to oversee the credit risk management function related to investments[151] Internal Controls - The company's disclosure controls and procedures were evaluated and deemed effective as of March 31, 2023, providing reasonable assurance for timely decision-making regarding required disclosures[153] - There were no changes in internal control over financial reporting that materially affected the company's controls during the quarter ended March 31, 2023[154]