Coupang(CPNG)2024-11-06 01:21Financial Data and Key Metrics - Constant currency revenues grew 32% YoY, or 25% excluding Farfetch, marking another quarter of at least 20% growth [7] - Active customers in Product Commerce grew 11% YoY, driven by increased spend from existing customers [7] - Gross profit reached 343 million, with a margin of 4.4% [19] - Net income attributable to Coupang stockholders was 0.04 [18] Business Line Data and Key Metrics - Product Commerce segment revenues grew 16% YoY, or 20% in constant currency [14] - Developing Offerings segment revenues grew nearly 350% YoY, or over 350% in constant currency [16] - FLC (Fulfillment and Logistics by Coupang) saw growth in units, sellers, and overall volumes, each growing over 130% YoY [10] Market Data and Key Metrics - Total retail spend in Korea was relatively flat YoY, while Coupang's Product Commerce segment grew revenues at 16% YoY [14] - Eats Taiwan and Farfetch showed strong momentum, with Farfetch achieving near break-even profitability [11][24] Company Strategy and Industry Competition - The company focuses on breaking trade-offs between selection and service, aiming to provide the best customer experience [5][9] - Investments in technology and infrastructure are being made to build a stronger foundation for future scalability [17][29] - The company sees a massive runway for growth in Korea, as it represents a small portion of the total commerce spend [14] Management Commentary on Operating Environment and Future Outlook - Management emphasized the importance of customer WOW and operational excellence in capturing future opportunities [12] - The company expects to generate leverage on technology investments, leading to declining OG&A as a percentage of revenue over time [17][29] - Long-term margin guidance for adjusted EBITDA is over 10%, with confidence in expanding margins annually [19][32] Other Important Information - The company launched R.Lux, a luxury offering, providing customers with access to in-demand luxury beauty brands [9] - WOW membership program continues to drive higher engagement, with WOW members spending 2.5x more than new members [8] Q&A Session Summary Question: Developing Offerings Loss Trend and Farfetch Profitability [22][23] - The loss in Developing Offerings decreased due to improvements in Eats and Farfetch, with Farfetch achieving near break-even profitability [24] - Synergies between Coupang and Farfetch will be assessed next year [24] Question: OG&A Cost and FLC Growth [27][28] - The increase in OG&A cost is due to timing of technology and infrastructure investments, not a structural change [29] - FLC growth in units, sellers, and volumes each grew over 130% YoY [30] Question: Product Commerce Margin and Developing Offerings Loss Guidance [31] - Product Commerce margin saw quarterly fluctuations but long-term margin guidance remains over 10% [32] - More updates on Developing Offerings loss guidance for 2025 will be shared in the upcoming quarter [33] Question: Technology Investments and Ad Take Rate [34][36] - Technology investments are not capitalized, and the company expects to generate leverage on these investments over time [35] - Ad take rate continues to be an important area of investment, though it remains a small percentage of overall transaction volume [38] Question: Eats Efficiency and Taiwan Market Progress [40] - Eats saw improved losses due to increased efficiency, with a focus on providing more choice and service [41] - Taiwan market progress is still early, with momentum and operational efficiencies being leveraged from Korea [42]