Stanley Yang

Stanley Yang from JPMorgan Chase & Co. asked about the potential for further Product Commerce margin improvement in the second half of 2025 and inquired about Coupang's forward-looking AI strategy.

Answer

CEO Bom Kim explained that AI has been core to operations for years and sees generative AI as a long-term enabler for growth and margin expansion, with a focus on practical applications and disciplined investment. CFO Gaurav Anand reiterated that Product Commerce margins are expected to exceed 10% over time, driven by technology and operational efficiencies, though the growth may not be linear quarter-to-quarter. He also confirmed expectations for consolidated OG&A expenses to decline as a percentage of revenue in the near to medium term.

Stanley Yang from JPMorgan Chase & Co. inquired about the outlook for Product Commerce margin improvement in the second half of 2025 and Coupang's forward-looking AI strategy.

Answer

CEO Bom Kim explained that AI has been core to operations for years and sees generative AI as a long-term enabler for growth and margin expansion, with a focus on practical applications like software development and robotics. CFO Gaurav Anand added that while Product Commerce margins have reached 9%, further annual expansion is expected from technology and efficiency gains, though not necessarily in a linear fashion. He also confirmed the expectation for consolidated OG&A expenses to decline as a percentage of revenue in the near to medium term.

Stanley Yang questioned Coupang's confidence in achieving its 20% revenue growth guidance amid the current macro and competitive environment, seeking color on the Product Commerce outlook, particularly the split between 1P and FLC. He also asked about the significant sequential increase in Developing Offerings losses and the margin trends for Eats and Taiwan.

Answer

CEO Bom Suk Kim affirmed confidence in the 20% growth outlook, highlighting that Fulfillment and Logistics by Coupang (FLC) is a significant driver growing at a high multiple of the overall business. He noted that Coupang Eats continues its strong momentum from 2024 and has significant room for growth and improved profitability as it scales, especially outside of Seoul.

Stanley Yang of JPMorgan Chase & Co. inquired about a potential slowdown in the domestic e-commerce market, the macroeconomic impact on Coupang's 2025 growth outlook, the revenue growth breakdown between Product Commerce and Developing Offerings, and the margin profile trend for the FLC (Fulfillment and Logistics by Coupang) business.

Answer

CEO Bom Kim responded that despite macro uncertainty, Coupang's growth outlook remains strong due to increasing customer engagement and its small share of the total retail market. He affirmed that Q1 growth would align with Q4's rate (ex-Farfetch). Regarding FLC, Kim stated the focus is on enhancing service levels for customers and merchants, noting that FLC's growth continues to be a high multiple of the overall business, driven by strong merchant adoption.

Stanley Yang questioned the Product Commerce margin expansion trajectory for the upcoming year and the potential for FLC to be a more meaningful driver. He also asked for any color on the Developing Offerings loss guidance for 2025.

Answer

Founder and CEO Bom Kim acknowledged quarterly margin fluctuations, citing seasonal impacts, but reiterated confidence in achieving the long-term adjusted EBITDA margin target of over 10% through various operational leverage opportunities. He deferred providing 2025 guidance for Developing Offerings to a future call, stating that the immediate focus for Farfetch is completing its stabilization.