CPNG Q4 2023 Earnings

Call Details

• Call Title: Coupang Q4 2023 Earnings Call
• Date: February 27, 2024 at 10:30 PM UTC
• Management Team:
  • Mike Parker (Vice President of Investor Relations)
  • Bom Kim (Chief Executive Officer)
  • Gaurav Anand (Chief Financial Officer)

Call Summary

Financial Performance

• Total net revenues were $6.6B, representing 23% year-over-year growth, or 20% in constant currency.
• Gross profit was $1.7B, up 32% year-over-year, and gross profit margin was 25.6%, improving 160 basis points year-over-year.
• Consolidated adjusted EBITDA for Q4 was $294M and full-year adjusted EBITDA was $1.1B, with a Q4 adjusted EBITDA margin of 4.5%, up 50 basis points year-over-year.
• Product commerce delivered $444M of adjusted EBITDA in Q4 at a 7.1% margin, expanding 190 basis points year-over-year.
• Developing offerings reported an existing EBITDA loss of $150M in Q4, which increased $95M year-over-year and decreased $10M quarter-over-quarter.
• Net income for the quarter was $1.0B and diluted EPS was $0.57, driven materially by a $895M tax-related reserve adjustment that had a $0.49 EPS impact.

Guidance

• The company expects adjusted EBITDA losses in developing offerings of approximately $650M in 2024, excluding Farfetch.
• The accounting change related to FLC will continue to adversely affect reported revenue growth for the next couple of quarters.
• The company expects a temporarily high effective tax rate of 45% to 50% in 2024 on an accounting basis, with cash taxes expected to be closer to 20% to 25%.
• Over the mid-to-long term, the company expects an effective tax rate to normalize closer to 25%.
• The company expects consolidated adjusted EBITDA margins to grow on an annual basis excluding Farfetch.
• No incremental investment in Farfetch beyond the previously announced capital commitment is anticipated.