Coupang signals accelerating Taiwan revenue momentum with Q3 growth expected to surpass Q2 triple-digit pace

Earnings Call Insights: Coupang, Inc. (CPNG) Q2 2025

Management View

CEO Bom Suk Kim reported that consolidated revenue grew 16% year-over-year, or 19% in constant currency, to $8.5 billion, with consolidated adjusted EBITDA reaching $428 million and margin expansion across key business lines. Kim emphasized, “We grew consolidated revenue 16% year-over-year or 19% in constant currency to $8.5 billion. Along with that growth, we also delivered another quarter of margin expansion, most evident in our Product Commerce segment, where gross profit margins expanded nearly 230 basis points to 32.6% and adjusted EBITDA margins grew 80 basis points to over 9%.”
Kim highlighted strategic investments in expanding Rocket selection, which added over 0.5 million new items in the quarter, and noted a more than 40% increase in same-day and on-delivery volume. The Fresh category saw revenue rise 25% in constant currency year-over-year, fueled by expanded assortment in produce, meat, and seafood.
Kim spotlighted the Taiwan business as a “prime example” of a high-potential developing market, stating, “After ending last year in Q4 with a quarter-over-quarter revenue growth of 23%, this quarter revenues surged 54% quarter-over-quarter, more than double the pace of revenue growth from just 2 quarters ago. Year-over-year revenue growth was triple digits in Q2, and we expect that to be even higher in Q3.”
The company launched Sports Pass for Coupang Play, expanding premium sports content, and made Play available to all Coupang customers in Korea, supported by advertising.
CFO Gaurav Anand stated, “Total net revenues this quarter grew 16% year-over-year or 19% in constant currency… Product Commerce segment revenues grew 14% year-over-year or 17% in constant currency. This growth was driven by both higher spend levels per active customer as well as an acceleration of growth in Product Commerce active customers to 10% this quarter.”

Outlook

Management reiterated a constant currency consolidated growth rate of roughly 20% for the full year, with Kim stating, “Our growth outlook for the full year remains in line with the guidance that we provided at the start of the year, constant currency consolidated growth rate of roughly 20%.”
For Developing Offerings, Anand updated full-year adjusted EBITDA loss expectations to between $900 million and $950 million, citing accelerated investments in Taiwan as the primary driver for this revision.
Anand indicated, “We continue to expect consolidated OG&A expenses to decline as a percentage of revenues in the near to medium term,” and expects a temporarily high effective tax rate of 65% to 70% for the full year.

Financial Results

Coupang reported $2.6 billion in consolidated gross profit, growing 20% year-over-year, with a consolidated gross profit margin of 30%. Product Commerce gross profit was $2.4 billion, with a record 32.6% margin.
Operating income was $149 million, up 55% over last year (excluding a prior year fine). Net income attributable to Coupang stockholders was $32 million, resulting in $0.02 of diluted earnings per share.
Developing Offerings reported EBITDA losses of $235 million, reflecting increased investment, particularly in Taiwan. On a trailing 12-month basis, operating cash flow was $1.9 billion and free cash flow was $784 million, which Anand attributed to the timing of CapEx and working capital fluctuations.

Q&A

Stanley Yang, JPMorgan: Asked about further Product Commerce margin improvement and AI strategy. Kim explained that AI is already core to operations, driving improvements in efficiency and customer experience, and sees “AI as a long-term enabler of both top line growth and margin expansion.” Anand noted, “There still remains large opportunities for us to leverage technology, AI automation and expand margin-accretive offerings.”
Minuh Cha, Goldman Sachs: Inquired about the future trajectory of Developing Offerings investments and Taiwan’s unit economics. Kim replied, “Our conviction in Taiwan is high and rising… Taiwan’s growth accelerating is driven by repeat customers driving the majority of that growth,” but acknowledged scaling inefficiencies typical at this stage. Anand said it is too early to comment on next year’s investment levels.
Seyon Park, Morgan Stanley: Asked about potential entry into data center/GPU management and macro-driven domestic consumption trends. Kim said internal AI computing infrastructure remains a small investment and is mainly for internal needs, with limited external experimentation. Growth outlook remains unchanged, driven by customer engagement rather than macro cycles.
Jiong Shao, Barclays: Asked about investment areas in Taiwan and gross margin drivers. Kim stated that multiple initiatives are being tested in Taiwan, with investment decisions based on demonstrated long-term value. Anand attributed gross margin expansion to efficiency gains, supply chain optimization, and margin-accretive offerings.
Wei Fang, Mizuho: Questioned Taiwan selection growth and Eats food delivery margin trend. Kim said selection expansion in Taiwan remains a focus, with strong customer response. For Eats, he stated the business is still far from full potential and continues to test initiatives with a rigorous approach.

Sentiment Analysis

Analysts expressed cautious optimism but pressed on sustainability of margin expansion, investment pacing in Developing Offerings, and the specifics of Taiwan’s profitability trajectory, with questions often seeking more granular forward-looking detail.
Management maintained a confident tone in both prepared remarks and responses, frequently referencing disciplined capital allocation and the replicability of the Korea success model in Taiwan. Kim reiterated, “We’re very confident that we’ll deliver over time, outsized value to customers and shareholders.”
Compared to the previous quarter, the sentiment from management remained positive and assertive, while analysts continued to seek clarity on the pace and return profile of new market investments, especially in Taiwan.

Quarter-over-Quarter Comparison

Revenue growth accelerated to 16% year-over-year from 11% in Q1, and adjusted EBITDA increased to $428 million from $382 million. Product Commerce margin expanded to over 9% from 8%.
Management raised Developing Offerings adjusted EBITDA loss guidance to a range of $900 million to $950 million, up from $650 million to $750 million previously, citing rapid investment in Taiwan.
The Taiwan business saw a pronounced acceleration in growth, with Q2 revenue surging 54% quarter-over-quarter and year-over-year growth in triple digits, outpacing the 23% quarter-over-quarter growth in Q4 2024 and the selection expansion highlighted in Q1.
Analysts in both quarters focused on profitability, margin sustainability, and Taiwan’s trajectory, but pressed more on the durability of investment and margin expansion this quarter.
Management asserted greater conviction in Taiwan’s long-term potential and continued to emphasize technological and operational investments as key to future growth and profitability.

Risks and Concerns

Management cited ongoing scaling inefficiencies in Taiwan, typical of early-stage market entries, and acknowledged nonrecurring costs related to restructuring activities in Farfetch.
Anand noted the temporarily high effective tax rate, driven by losses in early-stage operations and restructuring-related losses with no tax benefit.
Analysts raised concerns on timing for positive unit economics in Taiwan and whether Developing Offerings investments could peak or structurally increase.

Final Takeaway

Coupang delivered strong revenue growth and margin expansion in Q2 2025, highlighted by accelerating momentum in its Taiwan business and record profitability in Product Commerce. The company is increasing investments in developing markets, especially Taiwan, reflecting high conviction in the region’s long-term potential. Management reiterated its commitment to disciplined capital allocation, operational excellence, and leveraging technology and AI to drive further growth, with guidance and outlook remaining on track for the year.

Read the full Earnings Call Transcript