The Online Retailer’s Shares Fell 9%, Sales Rose but Missed Predictions
Coupang Inc. shares fell in after-hours trading Tuesday following a report of retail net sales that missed Wall Street expectations.
The company’s net sales reached $6.14 billion, marking an increase from last year but falling short of analysts’ forecast of $6.24 billion. Operating income was $109 million, also lower than anticipated. Net income decreased this quarter, reflecting losses from Farfetch, the online luxury retailer acquired by Coupang in January.
Coupang’s stock declined by as much as 8.9% in extended trading.
Despite the missed sales forecast, the Seattle-based online retailer, which acquired Farfetch this year in a widely discussed move, exceeded other performance metrics. The company achieved double-digit sales growth for the seventh consecutive quarter, driven by expanding business segments such as food delivery. Coupang reported net revenue growth of 27%, reaching $7.9 billion for the September quarter, surpassing the analysts’ average estimate of $7.8 billion.
Coupang’s stock has gained 66% this year, supported by its first full profitable year in 2023. The company, known for popularizing one-day delivery in Korea, is now targeting growth areas like luxury goods and expanding its presence in Taiwan, as competitors AliExpress and Temu move into Korea, Coupang’s largest market.
During a post-earnings call, CEO Bom Kim noted that Farfetch was near breakeven on an adjusted EBITDA basis in the last quarter, a target previously set for the end of 2024. Farfetch’s adjusted loss before interest, taxes, depreciation, and amortization narrowed to $2 million, down from $31 million in the April-June period.