[Click e-Stock] Coupang's Concerns Deepen... Customers Are Back, but When Will Profits Return?

Revenue up 7.5%... Operating loss of $450 million due to fire losses

Taiwan investment and declining core business margins add to the pressure

"Profitability recovery will take time"

Securities analysts say Coupang will need more time to recover its earnings. Customers have returned and revenue has grown, but losses are mounting as losses from a logistics center fire coincide with the burden of investing in new businesses.

According to Shinhan Securities on November 5, analyst Cho Sang-hoon said the previous day that “the recovery in customer metrics is positive, but profitability in the core business remains weak even excluding the losses from the fire.” The consensus target price, based on the average estimates of securities firms, is $23.10.

Coupang's revenue in the third quarter of 2026 was $9.962 billion (approximately KRW 13 trillion), up 7.5% from the same period a year earlier. Excluding foreign exchange effects, growth was 11%, exceeding the company's forecast. Profitability was the problem. The company posted an operating loss of $450 million, reflecting $250 million in losses from the fire at its Incheon logistics center in July 2026. Even excluding the fire-related losses, its operating loss reached $200 million.

Revenue in Product Commerce, its core business, rose 5% year over year to $8.374 billion. In contrast, adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) fell 45% to $390 million. Gross margin, excluding the fire-related losses, also declined by 2.6 percentage points to 29.5%, indicating continued margin pressure in the core business.

Customer metrics showed signs of recovery. The number of active customers rose 2% year over year to 25.2 million, surpassing the level recorded before the personal information leak. Average spending per customer also increased 3% to $332, returning to growth. However, the recovery in customers and increase in revenue did not lead to improved profitability.

Revenue in the Growth segment, which includes its Taiwan business, rose 23% year over year to $1.588 billion. Adjusted EBITDA was negative $270 million, narrowing the loss by $20 million from the same period a year earlier. However, the loss widened compared with negative $220 million in the previous quarter. Analysts say the company continues to bear the cost of investing to establish a foothold in the Taiwan market.

Full-year 2026 revenue is forecast to rise 7.5% year over year to $37.126 billion, while the company is expected to swing to an operating loss of $1.014 billion. In 2027, revenue is projected to reach $42.623 billion and operating profit $878 million, marking a return to profitability.

 

Analyst Cho said, "Share buybacks totaling $1.05 billion since the start of 2026 are a positive factor," but added, "Whether the impact of the fire will persist into the fourth quarter and how quickly margins in the core business recover are key factors for the stock price going forward. Patience will be needed until these headwinds are resolved."

This content was produced with the assistance of AI translation services.