Coupang Inc. (CPNG), the parent company of Coupang, reported a first-quarter operating loss of about 350 billion won ($255 million), as compensation costs tied to a massive data breach in the fourth quarter of last year weighed on profitability.
According to the first-quarter consolidated earnings report Coupang Inc. filed with the U.S. Securities and Exchange Commission (SEC) on Tuesday, first-quarter revenue rose 8% year-on-year to $8.504 billion (12.46 trillion won). Revenue, however, declined from $8.835 billion in the previous quarter.
Profitability deteriorated sharply. The first-quarter operating loss came in at $242 million (354.5 billion won), swinging from a profit of $154 million (233.7 billion won) a year earlier. Net loss also reached $266 million (389.7 billion won), marking a return to the red. The results not only broke the streak of double-digit quarterly growth the company had sustained since its initial public offering, but also represent the largest loss since the fourth quarter of 2021.
Performance diverged across business segments. Revenue from Product Commerce, the core business that includes Rocket Delivery, grew only 4% year-on-year to $7.176 billion. Active customers declined to 23.9 million, down 700,000 from 24.6 million in the previous quarter, signaling customer attrition. Meanwhile, revenue from Developing Offerings, which includes Rocket Delivery Taiwan, Farfetch and Coupang Eats, rose 28% to $1.328 billion.
The industry interprets the earnings shock as the impact of compensation costs following the data breach that occurred in November last year, along with expanded investment in new businesses. Coupang announced a customer compensation program at the time, providing purchase vouchers worth about $1.2 billion (1.685 trillion won). The vouchers are structured as deductions from revenue.
Separately, Coupang Inc. repurchased 20.4 million shares worth $391 million during the quarter. The company also said it had additionally authorized a $1 billion share buyback program as part of its capital allocation strategy.
