South Korea’s Coupang to remain profitable amidst funding crunch: report

The company’s net profit stood at $91m in the third quarter.

South Korea’s Coupang is expected to remain profitable amidst the funding crunch amongst tech startups, GlobalData reported. 

“Even as the funding crunch is plaguing the tech and e-commerce startups in a high-interest rate environment, SoftBank Group-backed e-commerce firm Coupang has reported an operating income of $77.4 billion for Q3 2022 compared to an operating loss of $315.1 billion for the corresponding quarter of FY2021,” Murthy Grandhi,  Analyst at GlobalData, said. 

“This positive performance was due to the continued growth in active customers and total net revenue per active customer, owing to the enhanced product selection of its owned inventory, customer engagement across more product categories, and increased merchants’ enrollment on its marketplace.”

Read more: South Korea’s Coupang posts record net profit in Q3

Coupang recently announced its net profit reached a record high of $91m in the third quarter of the year. Over the same period, total net revenue reached $5.1b, up 10% year-on-year. 

According to GlobalData, Coupang lowered its cost-to-sales ratio to 75.81% through the optimisation of its distribution channel and a greater proportion of revenue generation from higher margin revenue categories. 

“GlobalData forecasts the South Korean e-commerce market to exceed $167.7 billion in 2026. The e-commerce company is well-positioned to capture a significant market share with increased investments in technologies such as machine learning, process innovation, infrastructure, and distribution channel optimization,” Grandhi also said.