The headquarters of e-commerce platform Coupang in Songpa District, southern Seoul [YONHAP]
The U.S.-listed e-commerce giant Coupang swung to a net loss in the first quarter following a massive breach of its customer data in Korea last year.
Although the company posted $8.5 billion in revenue from January through March, it suffered a net loss of $266 million over the same period.
Coupang also recorded an operating loss of $242 million in the first quarter compared to an operating profit of $154 million a year ago.
It marked the company’s largest quarterly operating and net loss since the fourth quarter of 2021.
Analysts attributed much of the downturn to the impact of a massive data breach in Korea last November that exposed the personal information of some 33.7 million Coupang users.
The company’s Taiwan business also fell short of expectations, adding to pressure on earnings.
Coupang CEO Bom Kim sought to reassure investors in a conference call after the earnings release.
He said first-quarter earnings were affected by one-time vouchers issued in response to the data breach, as well as “temporary inefficiencies” caused by weaker-than-expected demand following the incident.
“The bulk of the impact [of customer vouchers] is contained to the first quarter, with a modest tail into the first part of the second quarter,” he said. “As demand returns to a predictable curve, we expect our capacity and supply chain to come back into balance and the inefficiencies to work their way out.”
Kim added that, as of April, Coupang has “closed nearly 80 percent of the decline in Wow membership that followed the incident through a combination of [...] returning members and [...] new sign-ups.”
However, he noted that on-year growth would take time to fully recover.
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
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