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4Q25 Earnings Update.
Coupang Reported 4Q25, the first quarter that was impacted after the November data leak and the stock is up 5%.
While there were rumors that they may have lost millions of customers and meaningful platform activity, the results showed a relatively muted impact.
Total gross profits grew +10% y/y (adjusted for an insurance gain and currency).
Product Commerce Gross Profts (excluding the insurance gain and in constant currency) grew +15% y/y. While this is a meaningful deceleration from last’ quarter’s +26% FXN run-rate, they noted that trends have since stabilized.
Active customers did fall for the first time ever by 0.1mn sequentially to 24.6mn, which is again a fairly minor impact given how vocal some news reports and consumers were.
While to be fair, the growth in Taiwan probably covers up some of the customer losses, we don’t believe these customers will be lost forever. They note on the call that trends “stabilized”, but didn’t specify if that meant churned customers returned. Nevertheless, if they are already seeing trends revert to pre-data scandal levels, we imagine it would only take a couple more quarters for churned customers to return.
They also emphasized that the data scandal was far less severe than the media (and Korean Government) has made it out to be with only 3,000 users reportedly actually having their data taken—not the 33 million figure in the news.
At the core of this data scandal is a bit of a conspiracy theory that the Korean government is trying to use Coupang as leverage to get a better U.S. trade deal. Coupang is technically a U.S. tech company, and they have a large and connected U.S. investor base, including incoming Fed Chair Kevin Warsh who sits on the Board of Directors. (A recent Bloomberg article has more details.) It is no doubt a bit odd for the Korean government to use a business that primarily sells to Korean consumers and has 100k Korean employees as leverage though.
Nevertheless, this all has created the suspicion that the reason the government is acting very differently in this data leak against Coupang than a recent one against SK Telecom—who leaked ~25 million users data and settled with a fine—is because of the greater geopolitical climate. In short though, we don’t think this will be a meaningful issue in a few quarters from now and they will be able to return to pre-scandal growth rates.
Outside of the data leak issue, everything else in the business is going well. Every cohort of users continues to spend more.
Product Commerce Adjusted EBITDA was +5% y/y with a margin of 7.7%. This was impacted by the lower revenue growth which hurt operating leverage.
Developing Offering Adjusted EBITDA was a loss of $300mn, primarily driven by increased investments in Taiwan.
Taiwan continues to enjoy “hyper-growth, with revenues again growing triple digits year-over-year this quarter.” They have been improving item selection in FMCG and expanding into other categories, all the while improving their delivery operations. Incredibly their service already covers 70% of Taiwan and 75% of volumes in December were delivered with “next day” delivery.
On Eats they mentioned that they are really “encouraged” by the results they see there with strong customer engagement and retention. They also mentioned Japan for the first time in a while, where they said similar commentary on their “Rocket Now food delivery” offering there. (This is different than the quick commerce initiative they abandoned.)
Coupang also disclosed that this was the first quarter where they generated positive y/y growth with Farfetch, while also generating positive economics. If you recall, they rolled out a Luxury offering for Coupang a while ago with white glove delivery. On this call they gave a little nod to the synergies between the two: “We see a real opportunity to create value for luxury customers around the world by combining Farfetch’s vast assortment with a white-glove shipping and returns experience”.
They also started buying back some stock this quarter—about $162mn.
If you look at just their 2025 Product Commerce segment, they generated $29.6bn in revenues and revenues grew +16% y/y for the full year. Gross profits grew even faster at +22% y/y because of the transition to more 3P volume, which has less of an impact to revenues.
Taking their revenue figure though (because that is what they guide their long-term margins too on), we think they make at least a 10% EBIT margin at maturity, which translates to a 12%+ adjusted long term margin (they only guide to 10% currently, but the product commerce segment is already around 8%).
At a 10% mature margin, the Product Commerce Segment would generate about $2.2bn in NOPAT with a 25% tax. Taking account for their ~$3bn in net cash, they have a $33bn enterprise value at a stock price of $19.50. This values their current Korean ecommerce operations at just 15x mature earnings, despite growing 20%+. This valuation also does not attribute any value to Taiwan or their Food delivery operations. If you put a lower 7% margin on that business for conservatism (Taiwan should have similar ecommerce margins, but food delivery is likely lower), that lowers their EV/ NOPAT margin to 13x.
In order to invest in Coupang, an investors needs to understand their value prop and the core Korea ecommerce opportunity, which we cover extensively in our report below.
Check it out here: Coupang Extensive Research Report here.
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*At the time of this writing, one or more contributors to this report has a position in Coupang. Furthermore, accounts one or more contributors advise on may also have a position in Coupang. This may change without notice.
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