Taiwan Also Embraces Rocket Delivery: Coupang to Increase Investment After Recording Maximum Sales

[Financial News] Coupang has once again broken its quarterly maximum performance record due to the high growth of its businesses such as Taiwan's Rocket Delivery. Coupang, which surpassed 40 trillion won in annual sales last year, is now within reach of achieving 50 trillion won in annual sales this year. In particular, to target the Taiwan market, the investment scale will be expanded to 1.3 trillion won this year. 

On the 6th (Korean time), Coupang Inc. announced through the 2nd quarter consolidated financial report submitted to the U.S. Securities and Exchange Commission (SEC) that it achieved sales of 11.9763 trillion won (8.524 billion dollars, based on the average quarterly exchange rate of 1,405.02). This is a 19% increase compared to the same period last year (10.0357 trillion won). In dollar terms, it grew by 16%, easily surpassing the previous maximum quarterly sales of 11.4876 trillion won in the first quarter.
Operating profit was 209.3 billion won (149 million dollars), turning to profit compared to an operating loss of 34.2 billion won in the second quarter of last year. However, the operating profit margin for the second quarter was 1.7%, down 0.3 percentage points from the first quarter's operating profit margin of 2%. Net profit was 43.5 billion won (31 million dollars), turning to profit compared to a net loss of 143.8 billion won in the second quarter of last year. 
Analysts suggest that Coupang's growth trend indicates that it is possible to surpass 50 trillion won in sales this year. Last year, it achieved sales of 41 trillion won. With sales of 23.4609 trillion won in the first half of this year, if the growth trend continues in the second half, achieving 50 trillion won is within reach. Annual operating profit is also expected to surpass the 1 trillion won mark for the first time. 
This quarter, Coupang achieved performance growth based on its core Rocket Delivery sales. Coupang's Product Commerce (Rocket Delivery, Rocket Fresh, Rocket Growth, Marketplace) active customers increased by 10% to 23.9 million compared to 21.7 million in the same period last year. The Product Commerce sales in Korean won were 10.3044 trillion won (7.334 billion dollars), a 17% growth compared to the same period last year. Sales per active customer increased by 6% to 431,340 won (307 dollars) compared to the same period last year.
Kim Beom-seok, Chairman of Coupang Inc., emphasized in a conference call that "Artificial Intelligence (AI) has been a core part of Coupang's operations for years, improving customer experience through personalized recommendations, inventory predictions, and route optimization using this technology," and "Coupang sees AI as a long-term driver for sales growth and margin expansion."

In particular, the growth of business segments such as Taiwan, Farfetch, and Coupang Eats played a significant role in achieving the maximum quarterly sales. The sales of the growth business segment (1.19 billion dollars) reached 1.6719 trillion won in Korean won terms, achieving the highest quarterly sales ever. The growth rate was 33% compared to the same period last year. Compared to the first quarter's growth business sales (1.038 billion dollars, 1.5078 trillion won), the high growth rate of 15% in dollars and 11% in Korean won terms continues.
Coupang also announced plans for additional investment in Taiwan's Rocket Delivery. When Coupang first entered Taiwan in the fourth quarter of 2022, the growth business sales were 180.6 billion won, but in just two and a half years, it achieved more than nine times growth on a quarterly basis. Coupang announced that it will expand the investment scale of the growth business from 1 trillion won to 1.3 trillion won, a 30% increase, driven by the growth of Taiwan's Rocket Delivery service.
Chairman Kim stated, "Taiwan's second quarter sales and customer numbers increased by 54% and 40%, respectively, compared to the previous first quarter," and "it shows a growth trajectory similar to the early days of Rocket Delivery in Korea."
Coupang plans to activate a fast Rocket Delivery system in Taiwan by increasing logistics centers and delivery camps across regions, similar to Korea, through aggressive investment. Currently, it operates a second logistics center equipped with machine learning and AI-based automation systems in Taoyuan City, and is also pursuing the operation of a third fulfillment center.
Professor Jeon Seong-min of the Department of Business Administration at Gachon University said, "Korean small business owners are gaining export opportunities in the Taiwan market by utilizing Coupang's infrastructure without large fixed-cost investments." 
wonder@fnnews.com Jeong Sang-hee Reporter