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What changed in Coupang, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Coupang, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+360 added−320 removedSource: 10-K (2025-02-25) vs 10-K (2024-02-28)

Top changes in Coupang, Inc.'s 2024 10-K

360 paragraphs added · 320 removed · 277 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeAs one of the largest private sector employers in South Korea, we directly employ approximately 78,000 employees as of December 31, 2023.
Biggest changeIn the same way our employees aim to go above and beyond for our customers, we aim to go above and beyond for them. As of December 31, 2024, we directly employ approximately 95,000 employees, the majority of which are located in South Korea, making us one of the largest private sector employers in the country.
Our Competition We compete with: (1) offline, online, and omnichannel retailers, suppliers, distributors, manufacturers, and producers of the products we offer and sell to consumers and businesses; (2) web search engines, comparison shopping websites, social networks, web portals, and other online and app-based means of discovering, using, or acquiring goods and services, either directly or in collaboration with other retailers; (3) companies that provide retail merchant services; (4) companies that sell grocery products online and offline; (5) on-demand food delivery services; (6) companies that provide fulfillment and logistics services for themselves or for third parties; (7) companies that provide online advertising products and services; (8) on-demand streaming entertainment services; and (9) financial services companies, including credit card issuers and payment platforms.
Our Competition We compete with: (1) offline, online, and omnichannel retailers, suppliers, distributors, manufacturers, and producers of the products we offer and sell to consumers and businesses; (2) web search engines, comparison shopping websites, social networks, web portals, and other online and app-based means of discovering, using, or acquiring goods and services, either directly or in collaboration with other retailers; (3) companies that provide retail merchant services; (4) companies that sell grocery products online and offline; (5) on-demand food delivery services; (6) companies that provide fulfillment and logistics services for themselves or for third parties; (7) companies that provide online advertising products and services; (8) on-demand streaming entertainment services; (9) financial services companies, including credit card issuers and payment platforms; and (10) companies that sell luxury goods online.
For additional information, see the risk factors herein in Part I—Item 1A.“Risk Factors” under the sub-caption “Risks Related to Laws, Regulation and Intellectual Property” in this Form 10-K. Company Website, Social Media, and Availability of SEC Filings Our corporate website address is http://www.aboutcoupang.com and our investor relations website is www.ir.aboutcoupang.com.
For additional information, see the risk factors herein in Part I—Item 1A.“Risk Factors” under the sub-caption “Risks Related to Laws, Regulation, and Intellectual Property” in this Form 10-K. Company Website, Social Media, and Availability of SEC Filings Our corporate website address is https://www.aboutcoupang.com and our investor relations website is https://ir.aboutcoupang.com.
Our efforts have centered on building an end-to-end integrated system of technology and infrastructure, and most importantly, an innovation-focused culture driven to raise our customers’ expectations and lead them to wonder “How did I ever live without Coupang?” Our Customer Experience We are committed to delivering a “wow” experience to all of our customers every day.
Our efforts have centered on building an end-to-end integrated system of technology and infrastructure, and most importantly, an innovation-focused culture driven to raise our customers’ expectations and lead them to wonder “How did I ever live without Coupang?” Our Customer Experience We are committed to delivering a “wow” experience to each of our customers every day.
Our Merchant Experience Small and medium-sized enterprises (SMEs) on Coupang form an essential part of our business, and we strive to be a growth driver for these companies through our win-win model. Over 75% of Coupang merchants are SMEs, which can leverage our nationwide fulfillment and logistics infrastructure to connect with millions of customers.
Our Merchant Experience Small and medium-sized enterprises (SMEs) on Coupang form an essential part of our business, and we strive to be a growth driver for these companies through our win-win model. For example, in Korea over 75% of Coupang merchants are SMEs, which can leverage our nationwide fulfillment and logistics infrastructure to connect with millions of customers.
We therefore encourage investors and others interested in our Company to review the information that we make available on our websites. Any updates to the list of disclosure channels through which we will announce information will be posted on the investor relations page on our website. Coupang, Inc. 2023 Form 10-K 6 Table of Contents
We therefore encourage investors and others interested in our Company to review the information that we make available on our websites. Any updates to the list of disclosure channels through which we will announce information will be posted on our investor relations website. Coupang, Inc. 2024 Form 10-K 6 Table of Contents
We have trademark rights in our name and other brand indicia and have trademark registrations for select marks in Korea, the United States, Taiwan and other jurisdictions around the world. We also have registered domain names for websites that we use in our business, such as www.aboutcoupang.com and similar variations.
We have trademark rights in our name and other brand indicia and have trademark registrations for select marks in Korea, the United States, Taiwan, the United Kingdom, and various European countries, and other jurisdictions around the world. We also have registered domain names for websites that we use in our business, such as https://www.aboutcoupang.com and similar variations.
Coupang, Inc. 2023 Form 10-K 5 Table of Contents file annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy and information statements and amendments to reports filed or furnished pursuant to Sections 13(a), 14, and 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
We file annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy and information statements and amendments to reports filed or furnished pursuant to Sections 13(a), 14, and 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
We promptly make available on our investor relations website, free of charge, the reports that we file or furnish with the Securities and Exchange Commission (the “SEC”), corporate governance information (including our Code of Business Conduct and Ethics) and select press releases. We 1 Measured using work-related and accident-related fatalities.
We promptly make available on our investor relations website, free of charge, the reports that we file or furnish with the Securities and Exchange Commission (the “SEC”), corporate governance information (including our Code of Business Conduct and Ethics) and select press releases.
These laws and regulations involve matters that are often central to our business, including our interactions with customers, suppliers, and merchants. They may regulate fair trade, competition, labor and employment, privacy, data protection, intellectual property, consumer protection, import and export regulations, and other subjects.
These laws and regulations, which are subject to change over time, involve matters that are often central to our business, including our interactions with customers, suppliers, and merchants. They may regulate fair trade, competition, labor and employment, privacy, data protection, data use, intellectual property, consumer protection, advertising, import and export regulations, tax, and other subjects.
Item 1. Business The Company We have created and continue to build a next generation experience for retail. By investing for the long term with a fanatical culture of customer centricity, we believe we are delivering a superior customer experience at a lower cost as we continue to redefine retail standards worldwide.
By investing for the long term with a culture focused on customer centricity, we believe we are delivering a superior customer experience at a lower cost as we continue to redefine retail standards worldwide.
Our customers simply tap a button on the app and leave the item outside their door for pickup. Refunds are initiated the moment the item is picked up at the door.
Customers are eligible for free, one-day delivery nationwide 365 days a year. • Frictionless Returns. Customers simply tap a button on the app and leave the item outside their door. Refunds are initiated the moment the item is picked up.
We believe the success of these offerings demonstrates the power of our network to extend offerings to our loyal customers. In January 2024 we acquired the business and assets of Farfetch, a leading global marketplace for the luxury fashion industry which connects customers with some of the world’s best boutiques and brands.
In January 2024 we acquired the business and assets of Farfetch Holdings plc (“Farfetch”), a leading global marketplace for the luxury fashion industry which connects customers in more than 190 countries and territories with some of the world’s best boutiques and brands.
We further control the use of our proprietary technology and intellectual property through provisions in our terms of service. Our design logos, “Coupang,” and our other registered or common law trademarks, service marks, or trade names appearing in this Form 10-K are our property or our affiliates’ property.
Coupang, Inc. 2024 Form 10-K 5 Table of Contents Our design logos, “Coupang,” and our other registered or common law trademarks, service marks, or trade names appearing in this Form 10-K are our property or our affiliates’ property. Other trade names, trademarks, and service marks used in this Form 10-K are the property of their respective owners.
We also launched Rocket Overseas to customers in Taiwan, empowering SME partners to unlock even more growth through sales to customers outside of Korea, at no additional effort or cost on their part. We offer merchants of all sizes the opportunity to sell on Coupang and provide effective solutions to improve their customer experiences and enhance demand generation.
As more SMEs partner with Coupang on private label products, more jobs are created. We also launched Rocket Overseas to customers in Taiwan, empowering SME partners to unlock even more growth through sales to customers outside of Korea, at no additional effort or cost on their part.
Coupang, Inc. 2023 Form 10-K 4 Table of Contents Seasonality Our overall operating results may fluctuate from quarter to quarter as a result of a variety of factors, including seasonal factors, economic cycles that influence consumer spend, and our ability to attract and retain new customers.
Seasonality Our overall operating results may fluctuate from quarter to quarter as a result of a variety of factors, including seasonal factors, weather conditions, economic cycles that influence consumer spend, and our ability to attract and retain new customers. Human Capital Our global team of employees is the driving force in creating a one-of-a-kind experience for millions of customers.
These investments include Coupang Care, the first paid health promotion program of its kind at scale for logistics workers in Korea. We believe the well-being of our employees is directly tied to the success of our business, and most importantly, our impact on our customers.
We believe the well-being of our employees is directly tied to the success of our business, and most importantly, our impact on our customers.
Other trade names, trademarks, and service marks used in this Form 10-K are the property of their respective owners. Government Regulation Government regulation impacts key aspects of our business. In particular, we are subject to a number of national, state/region, and local laws, standards and regulations in Korea, the U.S., Taiwan, China, and other jurisdictions where we operate.
Government Regulation Government regulation impacts key aspects of our business. In particular, we are subject to numerous national, state/regional, and local laws, legal requirements, standards and regulations in Korea, the United States, Taiwan, China, the United Kingdom, and various European countries, and other jurisdictions where we operate.
Our fulfillment & logistics by Coupang (“FLC”) offering empowers merchants by offering them our fulfillment, logistics, delivery, and customer service network services. Advertising We also have offerings for our suppliers and merchants to advertise on our websites and mobile applications.
Coupang, Inc. 2024 Form 10-K 4 Table of Contents We offer merchants of all sizes the opportunity to sell on Coupang and provide effective solutions to improve their customer experiences and enhance demand generation. Our fulfillment & logistics by Coupang (“FLC”) offering empowers merchants by offering them our fulfillment, logistics, delivery, and customer service network services.
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This commitment drives every aspect of our operations and pushes us to redefine the standards of the retail experience. We reimagined the retail customer experience with our Rocket Delivery service in Korea: • Dawn and Same-Day Delivery.
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Item 1. Business The Company Coupang is one of the fastest-growing technology and commerce companies in the world, providing retail, restaurant delivery, video streaming, and fintech services to customers around the world under brands that include Coupang, Coupang Eats, Coupang Play and Farfetch.
Removed
Orders are delivered within hours via Dawn Delivery (ordered as late as midnight, arrive before 7am) or Same-Day Delivery (ordered in the morning, arrive same-day). • Next-Day Delivery. Customers are eligible for free, one-day delivery nationwide 365 days a year. • Frictionless Returns.
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The technology, automation and efficiencies gained through our end-to-end systems have allowed Coupang to reinvest in new experiences and adjacent services.
Removed
In addition to Rocket Delivery available across Korea, our Rocket WOW membership program allows members to enjoy unlimited free shipping with no minimum spend, free unlimited returns for 30 days, delivery of groceries via Rocket Fresh, discounts on restaurant orders via Coupang Eats, and content streaming on Coupang Play.
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For example, the infrastructure that was originally created in Korea for fast delivery of general merchandise has evolved further to now also include same-day and dawn delivery of fresh produce and grocery items, as well as millions of general merchandise items.
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Human Capital Our global team of employees is the driving force in creating a one-of-a-kind experience for millions of customers. In the same way our employees aim to go above and beyond for our customers, we aim to go above and beyond for them.
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In Korea, the primary market we serve, we offer many services that provide customers with more selection, savings and convenience: • Dawn and Same-Day Delivery. Customers can order fresh groceries and choose from millions of general merchandise items by midnight and receive products by 7 am the next morning. • Next-Day Delivery.
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In Korea, we also offer our “WOW” membership program for a low monthly fee, which provides additional benefits: • Coupang Eats. Members receive free delivery of restaurant meals. • Coupang Play. Members enjoy a large catalog of streaming media content (OTT) and access to exclusive live sporting events featuring top teams from around the world. • Coupang Pay.
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Members can securely pay for Coupang purchases through this convenient feature built into the Coupang app. • Free Installation. Members receive free delivery and installation on purchases of select appliances, furniture, tires and more. We introduced Coupang in Taiwan in 2021. Since that time, we’ve opened new fulfillment centers and offer the following capabilities: • Next Day Delivery.
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Customers can order food and daily consumables for overnight delivery to their door on purchases over $15.00. • Free International Shipping (Rocket Overseas). Customers can choose from millions of American and Korean Products and receive free shipping on purchases over $21.00.
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The Farfetch marketplace connects luxury sellers with customers and offers brands direct-to-consumer distribution via an e-concession model. Advertising We also have offerings for our suppliers and merchants to advertise on our websites and mobile applications.
Added
These investments include Coupang Care, the first paid health promotion program of its kind at scale for logistics workers in Korea. Coupang has also launched several Coupang Care initiatives in Taiwan including mobile health checkups and a comprehensive employee assistance program.
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We further control the use of our proprietary technology and intellectual property through provisions in our terms of service. 1 Measured using work-related and accident-related fatalities.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThese risks are more fully described in this “Risk Factors” section, including the following: • our results of operations may fluctuate significantly, which makes our future results of operations difficult to predict and could cause our results of operations to fall below expectations; • we may be unable to effectively manage the continued growth of our workforce and operations, including the development and management of new business initiatives; • our business is rapidly evolving, and we plan to continue to forgo short-term financial performance for long-term growth, which makes it difficult to evaluate our future prospects and predict our future results of operations, including our revenue growth rate; • we have a history of net losses, and we may not be able to generate sufficient revenues to achieve or maintain profitability in future periods; • if we were to lose the services of members of our senior management team, we may not be able to effectively execute on our business strategy; • we face intense competition and could lose market share to our competitors if we do not innovate or compete effectively; • ongoing or future pandemics may continue to adversely affect our business, operations, and the geographies and communities in which we, our customers, suppliers, merchants, and advertisers operate; • because some of our operations are subject to Korean law, there are circumstances in which certain of our Korean affiliates’ executive officers may be held either directly or vicariously criminally liable for the actions of our Korean affiliates or our Korean affiliates’ executives and employees; • some of our operations are subject to certain detailed and complex fair trade, labor, employment, and workplace safety laws and regulations, which continue to evolve and have and will continue to affect our operations and financial performance, could subject us to costs and penalties, and may affect our reputation; • harm to our Coupang brand or our associated brands and marks (our “brand”) or reputation may occur if manufacturers and distributors from whom we buy products (“suppliers”) or the parties that sell their products on our marketplace (“merchants”) use unethical or illegal business practices, such as the sale of counterfeit or fraudulent products, or if our protocols with respect to such sales are perceived or found to be inadequate, which may also subject us to possible sanctions or penalties; • The acquisition of Farfetch creates incremental risk to our business, financial condition and results of operations; • any significant interruptions or delays in service on our apps or websites, or any undetected errors or design faults, could result in limited capacity, reduced demand, processing delays, and loss of customers, suppliers, or merchants; • any failure to protect our apps, websites, networks, and systems against security breaches or otherwise protect our confidential information could damage our reputation and brand and may subject us to possible sanctions or penalties; • any failure to comply with privacy laws or regulations, or to fulfill privacy-related customer expectations in the jurisdictions where we operate, could damage our reputation and brand and business and may subject us to possible sanctions or penalties; Coupang, Inc. 2023 Form 10-K 7 Table of Contents • we rely on Coupang Pay to conduct a substantial amount of the payment processing.
Biggest change(“New Guards”); • because a majority of our operations are subject to Korean law, there are circumstances in which certain of our Korean affiliates’ executives may be held either directly or vicariously criminally liable for the actions of our Korean affiliates or our Korean affiliates’ executives and employees; • a majority of our operations are subject to certain detailed and complex fair trade, labor, employment, and workplace safety laws and regulations, which continue to evolve and have and will continue to affect our operations and financial performance, could subject us to costs and penalties, and may affect our reputation; • harm to our Coupang brand or our associated brands and marks (our “brand”) or reputation may occur if manufacturers and distributors from whom we buy products (“suppliers”) or the parties that sell their products on our marketplace (“merchants”) use unethical or illegal business practices, such as the sale of counterfeit or fraudulent products, or if our protocols with respect to such sales are perceived or found to be inadequate, which may also subject us to possible sanctions or penalties; • any significant interruptions or delays in service on our apps or websites, or any undetected errors or design faults, could result in limited capacity, reduced demand, processing delays, and loss of customers, suppliers, or merchants; • any failure to protect our apps, websites, networks, and systems against security breaches or otherwise protect our confidential information could damage our reputation and brand and may subject us to possible sanctions or penalties; • any failure to comply with privacy laws or regulations, or to fulfill privacy-related customer expectations in the jurisdictions where we operate, could damage our reputation and brand and business and may subject us to possible sanctions or penalties; • we rely on Coupang Pay to conduct a substantial amount of the payment processing across our business.
Our ability to expand our fulfillment and logistics capacity is dependent upon our ability to secure suitable facilities and recruit and retain qualified employees, Coupang Flex partners (independent delivery partners who have signed up to deliver packages on days and times of their own choosing), Eats Delivery Partners or EDPs (independent food delivery partners), and other workers, and there is no assurance that we will be able to secure such facilities or procure such personnel.
Our ability to expand our fulfillment and logistics capacity is dependent upon our ability to secure suitable facilities and recruit and retain qualified employees, Coupang Flex partners (independent delivery partners who have signed up to deliver packages on days and times of their own choosing), Eats Delivery Partners, or EDPs (independent food delivery partners), and other workers, and there is no assurance that we will be able to secure such facilities or procure such partners or personnel.
Many of our competitors have, and potential competitors may have, competitive advantages such as longer operating histories, more experience in implementing their business plan and strategy, better brand recognition, popular offline locations, greater negotiating leverage, established supply relationships, significantly greater financial, marketing, and other resources.
Many of our competitors have, and potential competitors may have, competitive advantages such as longer operating histories, more experience in implementing their business plan and strategy, better brand recognition, popular offline locations, greater negotiating leverage, established supply relationships, and significantly greater financial, marketing, and other resources.
Although we have a service quality management team that is responsible for monitoring reports of listing, display, and sales of pirated, counterfeited, prohibited, regulated, or faulty merchandise and services, such items may nevertheless be listed, displayed, or sold on our apps or websites and may subject us to potential lawsuits, sanctions, fines, or other penalties, which could adversely affect our business.
Although we have a service quality management team that is responsible for monitoring reports of listing, display, and sales of pirated, counterfeited, prohibited, regulated, or faulty merchandise and services, such items may nevertheless be listed, displayed, or sold on our apps or websites and subject us to potential lawsuits, sanctions, fines, or other penalties, which could adversely affect our business.
The market price of shares of our Class A common stock could be subject to wide fluctuations in response to a broad and diverse range of factors, including those described elsewhere in this “Risk Factors” section and this Form 10-K and the following: • actual or anticipated fluctuations in our results of operations; • overall performance of the equity markets and the economy as a whole; • changes in the financial projections we may provide to the public or our failure to meet these projections; • failure of securities analysts to initiate or maintain coverage of us, changes in financial estimates by any securities analysts who follow us, or our failure to meet these estimates or the expectations of investors; • actual or anticipated changes in our growth rate relative to that of our competitors; • changes in the anticipated future size or growth rate of our addressable markets; • changes in our dividend or stock repurchase activities; • announcements of new products, or of acquisitions, strategic partnerships, joint ventures, or capital-raising activities or commitments, by us or by our competitors; • additions or departures of board members, management, or key personnel; • rumors and market speculation involving us or other companies in our industry; • new laws or regulations or new interpretations of existing laws or regulations applicable to our business, including those related to data privacy and cyber security in Korea or globally; • lawsuits or investigations threatened or filed against us; • other events or factors, including those resulting from war, incidents of terrorism, or responses to these events; • health epidemics and pandemics, influenza, and other highly communicable diseases or viruses; and • sales or expectations with respect to sales of shares of our Class A common stock by us or our security holders.
The market price of shares of our Class A common stock could be subject to wide fluctuations in response to a broad and diverse range of factors, including those described elsewhere in this “Risk Factors” section and this Form 10-K and the following: • actual or anticipated fluctuations in our results of operations; • overall performance of the equity markets and the economy as a whole; • changes in the financial projections we may provide to the public or our failure to meet these projections; • failure of securities analysts to initiate or maintain coverage of us, changes in financial estimates by any securities analysts who follow us, or our failure to meet these estimates or the expectations of investors; • actual or anticipated changes in our growth rate relative to that of our competitors; • changes in the anticipated future size or growth rate of our addressable markets; • changes in our dividend or stock repurchase activities; • announcements of new products or services, new geographic markets, or acquisitions, strategic partnerships, joint ventures, or capital-raising activities or commitments, by us or by our competitors; • additions or departures of board members, management, or key personnel; • rumors and market speculation involving us or other companies in our industry; • new laws or regulations or new interpretations of existing laws or regulations applicable to our business, including those related to data privacy and cyber security in Korea or globally; • lawsuits or investigations threatened or filed against us; • other events or factors, including those resulting from war, incidents of terrorism, or responses to these events; • health epidemics and pandemics, influenza, and other highly communicable diseases or viruses; and • sales or expectations with respect to sales of shares of our Class A common stock by us or our security holders.
If our management is unable to certify the effectiveness of our internal control or if our independent registered public accounting firm cannot deliver a report attesting to the effectiveness of our internal control over financial reporting, or if we identify or fail to remediate any significant deficiencies or material weaknesses in our internal control, we could be subject to regulatory scrutiny and a loss of public confidence, which could seriously harm our reputation, and the price per share of our Class A common stock could decline.
If our management is unable to certify the effectiveness of our internal control or if our independent registered public accounting firm cannot deliver a report attesting to the effectiveness of our internal control over financial reporting, or if we identify or fail to remediate any significant deficiencies or material weaknesses in our internal control, we could be subject to regulatory or NYSE scrutiny and a loss of public confidence, which could seriously harm our reputation, and the price per share of our Class A common stock could decline.
Risks Related to Our Business and Our Industry If we fail to timely identify or effectively respond to changing customer preferences and spending patterns, fail to expand the products being purchased by customers, or fail or are unable to obtain or offer appropriate categories of products, our relationship with our customers and the demand for our products and services could be materially and adversely affected, and the demand for our products and services could decrease, which could in turn materially and adversely affect our business, financial condition, results of operations, and prospects.
Risks Related to Our Business and Our Industry If we fail to timely identify or effectively respond to changing customer preferences and spending patterns, fail to expand the products being purchased by customers, or fail or are unable to obtain or offer appropriate categories of products, our relationship with our customers and the demand for our products and services could be materially and adversely affected, which could in turn materially and adversely affect our business, financial condition, results of operations, and prospects.
However, security breaches or other security incidents have in the past and could in the future result in the inadvertent or unauthorized use or disclosure of confidential and sensitive information we collect, store, or transmit, or otherwise enable third parties to gain unauthorized access to this information such as our inadvertent exposure of limited customer information within our App that occurred during an upgrade in 2021 and was remediated within an hour.
However, security breaches or other security incidents have in the past resulted and could in the future result in the inadvertent or unauthorized use or disclosure of confidential and sensitive information we collect, store, or transmit, or otherwise enable third parties to gain unauthorized access to this information such as our inadvertent exposure of limited customer information within our App that occurred during an upgrade in 2021 and was remediated within an hour.
Potential developments that could have an adverse impact on Korea’s economy include: • declines in customer confidence, decreases in consumer disposable income, a slowdown in customer spending and higher levels of unemployment; • adverse conditions or developments in the economies of countries and regions that are important export and import markets for Korea, such as Taiwan, China, the United States, Europe, and Japan, or in emerging market economies in Asia or elsewhere, including as a result of deteriorating economic and trade relations between the United States and China and increased uncertainties resulting from the United Kingdom’s exit from the European Union; • adverse changes or volatility in foreign currency reserve levels, commodity prices (including oil prices), exchange rates (including fluctuation of the KRW, the USD, the euro or other exchange rates, or the revaluation of the Chinese Renminbi), interest rates, inflation rates, or stock markets; • increased sovereign default risk of select countries and the resulting adverse effects on the global financial markets; • investigations of large Korean business groups and their senior management for possible misconduct; • a continuing rise in the level of household debt and increasing delinquencies and credit defaults by retail and small- and medium-sized enterprise borrowers in Korea; • the continued emergence of the Chinese economy, to the extent its benefits (such as increased exports to China) are outweighed by its costs (such as competition in export markets or for foreign investment and the relocation of the manufacturing base from Korea to China), as well as a slowdown in the growth of China’s economy, which is one of Korea’s most important export markets; • the economic impact of any pending or future free trade agreements or of any changes to existing free trade agreements; • social or labor unrest; • substantial changes in the market prices of Korean real estate; • a decrease in tax revenue and a substantial increase in the Korean government’s expenditures for fiscal stimulus measures, unemployment compensation, and other economic and social programs that, together, would lead to an increased government budget deficit; • financial problems or lack of progress in the restructuring of certain Korean conglomerates, certain other large troubled companies, or their suppliers; • loss of investor confidence arising from corporate accounting irregularities and corporate governance issues concerning certain Korean conglomerates; • increases in social expenditures to support an aging population in Korea or decreases in economic productivity due to the declining population size in Korea; • acts of war or geopolitical uncertainty and risk of further attacks by terrorist groups around the world; • the occurrence of severe health epidemics in Korea or other parts of the world; • deterioration in economic or diplomatic relations between Korea and its trading partners or allies, including deterioration resulting from territorial or trade disputes or disagreements in foreign policy (such as the ongoing trade disputes with Japan); Coupang, Inc. 2023 Form 10-K 28 Table of Contents • political uncertainty or increasing strife among or within political parties in Korea; • hostilities or political or social tensions involving oil producing countries in the Middle East and North Africa and any material disruption in the global supply of oil or increase in the price of oil; • an increase in the level of tensions or an outbreak of hostilities between North Korea and Korea or the United States; • political or social tensions involving Russia and any resulting adverse effects on the global supply of oil or the global financial markets; • natural or man-made disasters that have a significant adverse economic or other impact on Korea or its major trading partners; and • changes in financial regulations in Korea.
Potential developments that could have an adverse impact on Korea’s economy include: • declines in customer confidence, decreases in consumer disposable income, a slowdown in customer spending and higher levels of unemployment; • political instability or uncertainty; • adverse conditions or developments in the economies of countries and regions that are important export and import markets for Korea, such as Taiwan, China, the United States, Europe, and Japan, or in emerging market economies in Asia or elsewhere, including as a result of deteriorating economic and trade relations between the United States and China and increased uncertainties resulting from the United Kingdom’s exit from the European Union; • adverse changes or volatility in foreign currency reserve levels, commodity prices (including oil prices), exchange rates (including fluctuation of the KRW, the USD, the euro or other exchange rates, or the revaluation of the Chinese Renminbi), interest rates, inflation rates, or stock markets; • increased sovereign default risk of select countries and the resulting adverse effects on the global financial markets; • investigations of large Korean business groups and their senior management for possible misconduct; • a continuing rise in the level of household debt and increasing delinquencies and credit defaults by retail and small- and medium-sized enterprise borrowers in Korea; • the continued emergence of the Chinese economy, to the extent its benefits (such as increased exports to China) are outweighed by its costs (such as competition in export markets or for foreign investment and the relocation of the manufacturing base from Korea to China), as well as a slowdown in the growth of China’s economy, which is one of Korea’s most important export markets; • the economic impact of any pending or future free trade agreements or of any changes to existing free trade agreements; • social or labor unrest; • substantial changes in the market prices of Korean real estate; • a decrease in tax revenue and a substantial increase in the Korean government’s expenditures for fiscal stimulus measures, unemployment compensation, and other economic and social programs that, together, would lead to an increased government budget deficit; • financial problems or lack of progress in the restructuring of certain Korean conglomerates, certain other large troubled companies, or their suppliers; • loss of investor confidence arising from corporate accounting irregularities and corporate governance issues concerning certain Korean conglomerates; • increases in social expenditures to support an aging population in Korea or decreases in economic productivity due to the declining population size in Korea; • acts of war or geopolitical uncertainty and risk of further attacks by terrorist groups around the world; • the occurrence of severe health epidemics in Korea or other parts of the world; Coupang, Inc. 2024 Form 10-K 28 Table of Contents • deterioration in economic or diplomatic relations between Korea and its trading partners or allies, including the imposition of any new or increased tariffs, or any deterioration resulting from territorial or trade disputes or disagreements in foreign policy (such as the ongoing trade disputes with Japan); • political uncertainty or increasing strife among or within political parties in Korea; • hostilities or political or social tensions involving oil producing countries in the Middle East and North Africa and any material disruption in the global supply of oil or increase in the price of oil; • an increase in the level of tensions or an outbreak of hostilities between North Korea and Korea or the United States; • political or social tensions involving Russia and any resulting adverse effects on the global supply of oil or the global financial markets; • natural or man-made disasters that have a significant adverse economic or other impact on Korea or its major trading partners; and • changes in financial regulations in Korea.
Kim owes a fiduciary duty to our stockholders as a board member and officer, as a stockholder, Mr. Kim is entitled to vote his shares in his own interest, which may not always be in the interest of our stockholders generally. Similarly, a reduction in Mr. Kim’s shareholdings could impact his ability to control corporate matters.
Kim owes a fiduciary duty to the Company and our stockholders as a board member and officer, as a stockholder, Mr. Kim is entitled to vote his shares in his own interest, which may not always be in the interest of our stockholders generally. Similarly, a reduction in Mr. Kim’s shareholdings could impact his ability to control corporate matters.
We cannot be certain when or if our operations will generate sufficient cash to fully fund our ongoing operations or the growth of our business. We intend to continue to make investments to support the development of our various apps and websites and expansion of our commercial offerings, and will require additional funds for such development and expansion.
We cannot be certain if our operations will continue to generate sufficient cash to fully fund our ongoing operations or the growth of our business. We intend to continue to make investments to support the development of our various apps and websites and expansion of our commercial offerings, and will require additional funds for such development and expansion.
Even though we have experienced recent profitability and expect to remain profitable, we cannot ascertain whether we will be able to maintain or further increase our profitability in future periods. Our costs and expenses are expected to increase in future periods, which could materially and adversely affect our future results of operations.
Even though we have experienced recent profitability and expect to remain profitable, we cannot ascertain whether we will be able to maintain or increase our profitability in future periods. Our costs and expenses are expected to increase in future periods, which could materially and adversely affect our future results of operations.
Our competitors may undertake aggressive marketing campaigns to enhance their brand name and increase the volume of business conducted through their stores or websites and make extensive investments to improve their stores or network and system infrastructure, including website design and logistics network enhancements.
Our competitors may undertake aggressive marketing or pricing campaigns to enhance their brand name and increase the volume of business conducted through their stores or websites and make extensive investments to improve their stores or network and system infrastructure, including website design and logistics network enhancements.
For more, see the risk factor titled “ Our business depends on network and mobile infrastructure, third-party data center hosting facilities, other third-party providers, and our ability to maintain and scale our technology.
For more, see the risk factor below titled “ Our business depends on network and mobile infrastructure, third-party data center hosting facilities, other third-party providers, and our ability to maintain and scale our technology.
Coupang, Inc. 2023 Form 10-K 20 Table of Contents We are subject to payment-related risks, and if payment processors are unwilling or unable to provide us with payment processing services or impose onerous requirements on us in order to access their services, or if they increase the fees they charge us for these services, our business, financial condition, and results of operations could be materially and adversely affected.
Coupang, Inc. 2024 Form 10-K 20 Table of Contents We are subject to payment-related risks, and if payment processors are unwilling or unable to provide us with payment processing services or impose onerous requirements on us in order to access their services, or if they increase the fees they charge us for these services, our business, financial condition, and results of operations could be materially and adversely affected.
These regulations and laws may involve taxes, tariffs, consumer protection, competition and antitrust, privacy and data security, anti-spam, content protection, electronic contracts and communications, and gift cards, among other topics.
These regulations and laws may involve taxes, tariffs, consumer protection, competition and antitrust, privacy and data security, anti-spam, content protection, AI, electronic contracts and communications, and gift cards, among other topics.
South Korea has enacted legislation to implement OECD framework including the Under-taxed Profit Rules (the “UTPR”) which may impose additional reporting and compliance obligations to our group effective from January 1, 2025. This minimum tax will be treated as a period cost in future years and did not impact operating results for 2023.
South Korea has enacted legislation to implement OECD framework including the Under-taxed Profit Rules (the “UTPR”) which may impose additional reporting and compliance obligations to our group effective from January 1, 2025. This minimum tax will be treated as a period cost in future years and did not impact operating results for 2024.
Under the rules of the Internal Revenue Code of 1986, as amended, we may be subject to U.S. federal income tax on a substantial portion of any income earned by our non-U.S. affiliates, regardless of whether that income is distributed to us, although it may be possible to offset some or all of any U.S. tax liability with credits for non-U.S. income taxes paid by the non-U.S. affiliates.
Under the rules of the Internal Revenue Code of 1986, as amended, we may be subject to the United States federal income tax on a substantial portion of any income earned by our non-U.S. affiliates, regardless of whether that income is distributed to us, although it may be possible to offset some or all of any United States tax liability with credits for non-U.S. income taxes paid by the non-U.S. affiliates.
We may face a number of challenges that may affect our ability to sustain our corporate culture, including a potential failure to attract and retain employees who embrace and further our culture, any expansion into additional geographies, competitive pressures that may divert us from our vision and values, and the integration of new personnel and businesses from acquisitions, including the recent acquisition of Farfetch.
We may face a number of challenges that may affect our ability to sustain our corporate culture, including a potential failure to attract and retain employees who embrace and further our culture, any expansion into additional geographies and new lines of business, competitive pressures that may divert us from our vision and values, and the integration of new personnel and businesses from acquisitions, including the recent acquisition of Farfetch.
In addition, because we have limited historical financial data and our business continues to evolve and expand, any predictions about our future revenue, expenses, and results of operations may not be as accurate as they would be if we had a longer operating history or operated a business that is not rapidly evolving and growing.
In addition, because we have limited historical financial data about certain aspects of our business, and our business continues to evolve and expand, any predictions about our future revenue, expenses, and results of operations may not be as accurate as they would be if we had a longer operating history or operated a business that is not rapidly evolving and growing.
For example, under the Foreign Exchange Transaction Act of Korea, if the Korean government determines that in certain emergency circumstances, including sudden fluctuations in interest rates or exchange rates, extreme difficulty in stabilizing the balance of payments or substantial disturbance in the Korean financial and capital markets are likely to occur, it may impose any necessary restriction such as requiring Korean or foreign investors to obtain prior approval from the Minister of Economy and Finance of Korea prior to entering into a capital markets transaction, repatriating interest, dividends or sales proceeds arising from Korean securities or from the disposition of such securities or other transactions involving foreign exchange.
For example, under the Foreign Exchange Transaction Act of Korea, if the Korean government determines that in certain emergency circumstances, including sudden fluctuations in interest rates or exchange rates, extreme difficulty in stabilizing the balance of payments or substantial disturbance in the Korean financial and capital markets are likely to occur, it may impose any necessary restriction such as requiring Korean or foreign investors to obtain prior approval from the Minister of Economy and Finance of Korea prior to repatriating interest, dividends or sales proceeds arising from Korean securities or from the disposition of such securities or other transactions involving foreign exchange.
Expansion involves new risks and challenges and may require significant investments. Our lack of familiarity with new markets and new Coupang, Inc. 2023 Form 10-K 14 Table of Contents products and services and lack of relevant customer data relating to these new markets or offerings may make it more difficult for us to anticipate customer demand and preferences.
Expansion involves new risks and challenges and may require significant investments. Our lack of familiarity with new markets and new products and services and lack of relevant customer data relating to these new markets or offerings may make it more difficult Coupang, Inc. 2024 Form 10-K 14 Table of Contents for us to anticipate customer demand and preferences.
Moreover, negative publicity arising from these types of disruptions could damage our reputation and may adversely impact use of our apps and websites. Coupang, Inc. 2023 Form 10-K 21 Table of Contents AWS enables us to access and use its service offerings in varying amounts and sizes, and across multiple regions.
Moreover, negative publicity arising from these types of disruptions could damage our reputation and may adversely impact use of our apps and websites. Coupang, Inc. 2024 Form 10-K 21 Table of Contents AWS enables us to access and use its service offerings in varying amounts and sizes, and across multiple regions.
In recent years, we have expanded our offerings, including in consumer electronics, food and grocery, financial services, private-label brands, apparel, streaming content, travel, and export and import offerings, as well as expanded our reach into new geographies such as Taiwan and various geographies in which Farfetch, or future businesses we may acquire, operate.
In recent years, we have expanded our offerings, including in consumer electronics, food and grocery, financial services, private-label brands, apparel, streaming content, travel, luxury products, and export and import offerings, as well as expanded our reach into new geographies such as Taiwan and various geographies in which Farfetch, or future businesses we may acquire, operate.
Coupang, Inc. 2023 Form 10-K 27 Table of Contents Our business may be adversely affected by developments that negatively impact the Korean economy and uncertainties in economic conditions that impact spending patterns of our customers in Korea. We have historically generated a substantial majority of our revenue from sales in Korea.
Coupang, Inc. 2024 Form 10-K 27 Table of Contents Our business may be adversely affected by developments that negatively impact the Korean economy and uncertainties in economic conditions that impact spending patterns of our customers in Korea. We have historically generated a substantial majority of our revenue from sales in Korea.
Coupang, Inc. 2023 Form 10-K 17 Table of Contents Acquisitions, strategic investments, partnerships, or alliances could be difficult to identify, pose integration challenges, divert the attention of management, disrupt our business, dilute stockholder value, and materially and adversely affect our business, financial condition, and results of operations.
Coupang, Inc. 2024 Form 10-K 17 Table of Contents Acquisitions, strategic investments, partnerships, or alliances could be difficult to identify, pose integration challenges, divert the attention of management, disrupt our business, dilute stockholder value, and materially and adversely affect our business, financial condition, and results of operations.
Further expansion into additional geographies and offerings, such as our entry into the global luxury goods space through Farfetch, will require significant management attention and resources and would require us to localize our offerings to conform to a wide variety of local cultures, business practices, laws, regulations, and policies.
Further expansion into additional geographies and offerings, such as our recent entry into the global luxury goods space through Farfetch, will continue to require significant management attention and resources and would require us to localize our offerings to conform to a wide variety of local cultures, business practices, laws, regulations, and policies.
We are also subject to regulations relating to privacy and use of confidential information of our users, including, among others, Korea’s Personal Information Protection Act and related legislation, regulations and orders (the “PIPA”), China’s Personal Information Protection Act, the Act on the Promotion of Information and Communications Network Utilization and Protection of Information Act (Korea), and the Credit Information Act in Korea that specifically regulates certain sensitive personal information.
We are also subject to regulations relating to privacy and use of confidential information of our consumers, including, among others, Korea’s Personal Information Protection Act and related legislation, regulations and orders (the “PIPA”), China’s Personal Information Protection Act, the Act on the Promotion of Information and Communications Network Utilization and Protection of Information Act (Korea), and the Credit Information Act in Korea that specifically regulates certain sensitive personal information.
Risks related to our fulfillment and logistics infrastructure described above in the risk factor titled “If we do not successfully operate and manage the expansion of our fulfillment and logistics infrastructure, our business, financial condition, and results of operations could be materially harmed.” are magnified during the holiday seasons.
Risks related to our fulfillment and logistics infrastructure described above in the risk factor titled “ If we do not successfully operate and manage the expansion of our fulfillment and logistics infrastructure, our business, financial condition, and results of operations could be materially harmed. ” are magnified during the holiday seasons.
These reasons include those described elsewhere in this “Risk Factors” section as well as the following: • our ability to attract new and retain existing customers, increase sales to existing customers, and satisfy our customers’ demands; • our ability to offer merchandise and services on favorable terms, manage inventory, and fulfill orders in a timely manner; • the introduction or activities of competitive stores, apps, websites, merchandise, or services; • the success of our growth and expansion efforts, including investments into new initiatives and expansion into new geographies; • variations in our level of merchandise and supplier returns; • the extent to which we offer fast and free delivery through Rocket Delivery, continue to offer a compelling value proposition to our customers, and provide additional benefits to our customers; • factors affecting our reputation or brand image or awareness; • the extent to which we finance our current operations and future growth, and the terms of any such financing; • the timing, effectiveness, and costs of expansion and upgrades of our systems and infrastructure; • the outcomes of any legal proceedings and claims or regulatory investigations, which may include significant monetary damages, injunctive relief, personal liability (including criminal liability), sanctions, fines, suspensions or revocations of related permits and licenses, and penalties; • the extent to which we invest in technology and content, fulfillment, and other expense categories; • increases in our temporary or long-term costs such as labor and energy sources, packing supplies, and other goods not for resale; • changes in existing, or development of new, laws, regulations, or other regulatory practices and enforcement in the countries where we operate; Coupang, Inc. 2023 Form 10-K 9 Table of Contents • the extent to which our services are affected by cybersecurity and data security incidents, including but not limited to spyware, viruses, phishing, and other spam emails, denial of service attacks, data theft, computer intrusions, outages, and similar events; and • disruptions from natural or man-made disasters, extreme weather conditions (including as a result of climate change) and other catastrophic events, global health epidemics and pandemics, geopolitical events and security issues (including terrorist attacks and armed hostilities), labor or trade disputes, macroeconomic conditions, and other similar events.
These reasons include those described elsewhere in this “Risk Factors” section as well as the following: • our ability to attract new and retain existing customers, increase sales to existing customers, and satisfy our customers’ demands; • our ability to offer merchandise and services on favorable terms, manage inventory, and fulfill orders in a timely manner; • the introduction or activities of competitors’ stores, apps, websites, merchandise, or services; • the success of our growth and expansion efforts, including investments into new initiatives and expansion into new geographies; • variations in our level of merchandise and supplier returns; • the extent to which we offer fast and free delivery through Rocket Delivery, continue to offer a compelling value proposition to our customers, and provide additional benefits to our customers; • factors affecting our reputation or brand image or awareness; • the extent to which we finance our current operations and future growth, and the terms of any such financing; • the timing, effectiveness, and costs of expansion and upgrades of our systems and infrastructure; • the outcomes of any legal proceedings and claims or regulatory investigations, which may include significant monetary damages, injunctive relief, personal liability (including criminal liability), sanctions, fines, suspensions or revocations of related permits and licenses, and penalties; • the extent to which we invest in technology and content, fulfillment, and other expense categories; • increases in our temporary or long-term costs such as labor and energy sources, packing supplies, and other goods not for resale; • changes in existing, or development of new, laws, regulations, or other regulatory practices and enforcement in the countries where we operate; • the extent to which our services are affected by cybersecurity and data security incidents, including, but not limited to, spyware, viruses, phishing, and other spam emails, denial of service attacks, data theft, computer intrusions, outages, and similar events; and • disruptions from natural or man-made disasters, extreme weather conditions (including as a result of climate change) and other catastrophic events, global health epidemics and pandemics, geopolitical events and security issues (including terrorist attacks and armed hostilities), labor or trade disputes, macroeconomic conditions, and other similar events.
We strive to predict these trends, as overstocking or understocking products we sell could lead to lower sales, missed opportunities, and excessive markdowns, each of which could have a material impact on our business and results of operations.
We strive to predict these trends, as overstocking or understocking products we sell could lead to lower sales, missed opportunities, and excessive markdowns or write-offs, each of which could have a material impact on our business and results of operations.
If our executive officers were to be named in such criminal proceedings or held either directly or vicariously criminally liable for the actions of the company and its executives and employees, our business, financial condition, and results of operations may be harmed.
If our executives were to be named in such criminal proceedings or held either directly or vicariously criminally liable for the actions of the company and its executives and employees, our business, financial condition, and results of operations may be harmed.
Legal proceedings are inherently uncertain, and any judgment, ruling, fine, penalty or injunctive relief entered against us or any adverse settlement in current or other future matters could result in harm to our reputation, sanctions, consent decrees, injunctions, or orders requiring a change in our business practices or otherwise negatively affect our business, results of operations, and financial condition.
Legal proceedings are inherently uncertain, and any judgment, ruling, fine, penalty or injunctive relief entered against us or any adverse settlement in current or other future matters could result in harm to our reputation, monetary damages, fines or other sanctions, consent decrees, injunctions, or orders requiring a change in our business practices or otherwise negatively affect our business, results of operations, and financial condition.
For example, complaints alleging infringement of intellectual property rights, breaches of certain Korean laws (e.g., labor standards laws and fair trade laws), and product-related claims may be investigated and prosecuted as criminal offenses with both the company and the company’s executive officers being named as defendants in such proceedings. These risks change over time.
For example, complaints alleging infringement of intellectual property rights, breaches of certain Korean laws (e.g., labor standards laws and fair trade laws), and product-related claims may be investigated and prosecuted as criminal offenses with both the company and the company’s executives being named as defendants in such proceedings. These risks change over time.
Coupang Pay is subject to a number of risks, if they were to materialize, that could materially and adversely affect its ability to provide payment processing services to us, including, but not limited to: • dissatisfaction with Coupang Pay’s services or lower use of Coupang Pay by customers and merchants; • increasing competition, including from other established companies, payment service providers, and companies engaged in other financial technology services; • changes to rules or practices applicable to payment systems that link to Coupang Pay; • breach of customers’ privacy and concerns over the use and security of information collected from customers and any related negative publicity or liability relating thereto; • service outages, system failures, or failure to effectively scale the system to handle large and growing transaction volumes; • increasing costs to Coupang Pay, including fees charged by banks to process transactions through Coupang Pay, which would also increase our cost of revenue; • negative news about and social media coverage on Coupang Pay, its business, its service offerings, or matters relating to Coupang Pay’s data security and privacy; and • failure to manage customer funds accurately or loss of customer funds, whether due to employee fraud, security breaches, technical errors, or otherwise.
Coupang Pay is subject to a number of risks which, if they were to materialize, could materially and adversely affect its ability to provide payment processing services to us and our customers, including, but not limited to: • dissatisfaction with Coupang Pay’s services or lower use of Coupang Pay by customers and merchants; • increasing competition, including from other established companies, payment service providers, and companies engaged in other financial technology services; • changes to rules or practices applicable to payment systems that link to Coupang Pay; • breach of customers’ privacy and concerns over the use and security of information collected from customers and any related negative publicity or liability relating thereto; • service outages, system failures, or failure to effectively scale the system to handle large and growing transaction volumes; • increasing costs to Coupang Pay, including fees charged by banks to process transactions through Coupang Pay, which would also increase our cost of revenue; Coupang, Inc. 2024 Form 10-K 19 Table of Contents • negative news about and social media coverage on Coupang Pay, its business, its service offerings, or matters relating to Coupang Pay’s data security and privacy; and • failure to manage customer funds accurately or loss of customer funds, whether due to employee fraud, security breaches, technical errors, or otherwise.
In addition, under Korean law, there are circumstances in which certain executive officers of a company may be investigated or held criminally liable either directly or vicariously for the actions of the company and its executives and employees.
In addition, under Korean law, there are circumstances in which certain executives of a company may be investigated or held criminally liable either directly or vicariously for the actions of the company and its executives and employees.
Prior to 2023, we have had a history of net losses, including $(0.1) billion and $(1.5) billion for 2022 and 2021 respectively, as well as an accumulated deficit of $(4.4) billion as of December 31, 2023.
Prior to 2023, we have had a history of net losses, including $(0.1) billion and $(1.5) billion for 2022 and 2021 respectively, as well as an accumulated deficit of $(4.2) billion as of December 31, 2024.
There is doubt as to the enforceability in Korean courts, in original actions or in actions for enforcement of judgments of U.S. courts, of civil liabilities predicated solely upon the federal and state securities laws of the United States.
There is doubt as to the enforceability in Korean courts, in original actions or in actions for enforcement of judgments of the United States courts, of civil liabilities predicated solely upon the federal and state securities laws of the United States.
Any failure to protect our apps, websites, networks, and systems against security breaches or otherwise protect our confidential information could damage our reputation and brand and adversely affect our business, financial condition, and results of operations.
Any failure to protect our apps, websites, networks, and systems against security breaches or otherwise protect our and our customers’ and business partners’ confidential information could damage our reputation and brand and adversely affect our business, financial condition, and results of operations.
Additionally, there are, and will likely continue to be, an increasing number of laws and regulations pertaining to the Internet and retail sales that may relate to liability for information retrieved from or transmitted over the Internet, display of certain taxes and fees, online editorial and user-generated content, user privacy, data security, network and information systems security, behavioral and online advertising, taxation, liability for third-party activities, quality of services, and consumer protection.
Additionally, there are, and will likely continue to be, an increasing number of laws and regulations pertaining to the Internet and retail sales that may relate to liability for information retrieved from or transmitted over the Internet, display of certain taxes and fees, online editorial and user-generated content, user privacy, data security, network and information systems security, behavioral and online advertising, the use of AI and machine learning, taxation, liability for third-party activities, quality of services, and consumer protection.
Moreover, we are also subject to other data privacy and protection laws regulating the collection, use, retention, disclosure, transfer, and processing of personal information, such as the California Consumer Privacy Act, which was significantly modified by the California Privacy Rights Act, similar laws in other states in the US, and the European Union's General Data Protection Regulation.
Moreover, we are also subject to other data privacy and protection laws regulating the collection, use, retention, disclosure, transfer, and processing of personal information, such as the California Consumer Privacy Act, which was significantly modified by the California Privacy Rights Act, similar laws in other states in the United States, the United Kingdom’s General Data Protection Regulation, and the European Union's General Data Protection Regulation.
These risks and uncertainties include but are not limited to our ability to effectively and in a timely manner: • attract, on a cost-effective basis, new customers who purchase merchandise and services from us at similar or higher rates and amounts as compared to existing customers; • retain our existing customers and motivate their continued purchases from our apps and websites at rates and amounts consistent with or higher than their historical purchases; • encourage customers to expand the categories of merchandise and services they purchase from us; Coupang, Inc. 2023 Form 10-K 8 Table of Contents • retain and expand our network of suppliers and merchants; • manage and expand our fulfillment and logistics infrastructure and related operations; • fulfill and deliver customer orders on time and in accordance with customer expectations, which may change over time; • increase awareness of our brand and protect our reputation; • respond to changes in the way customers access and use the Internet and mobile devices; • react to challenges from existing and new competitors; • expand our business in new and existing geographies; • avoid interruptions or disruptions in our business; • further develop our scalable, high-performance technology and fulfillment infrastructure that can efficiently and reliably handle increased usage, as well as the deployment of new features and the sale of new merchandise and services; and • hire, integrate, motivate and retain qualified personnel.
These risks and uncertainties include but are not limited to our ability to effectively and in a timely manner: • attract, on a cost-effective basis, new customers who purchase merchandise and services from us at similar or higher rates and amounts as compared to existing customers; • retain our existing customers and motivate their continued purchases from our apps and websites at rates and amounts consistent with or higher than their historical purchases; • encourage customers to expand the categories of merchandise and services they purchase from us; • retain and expand our network of suppliers and merchants; • manage and expand our fulfillment and logistics infrastructure and related operations; • fulfill and deliver customer orders on time and in accordance with customer expectations, which may change over time; • increase awareness of our brand and protect our reputation; • respond to changes in the way customers access and use the Internet and mobile devices; • react to challenges from existing and new competitors; • expand our business in new and existing geographies; • avoid interruptions or disruptions in our business; • further develop our scalable, high-performance technology and fulfillment infrastructure that can efficiently and reliably handle increased usage, as well as the deployment of new features and the sale of new merchandise and services; and • hire, integrate, motivate and retain qualified personnel.
Our business and the infrastructure on which our business relies is vulnerable to damage or interruption from catastrophic occurrences, such as earthquakes, floods, fires, extreme weather events (whether as a result of climate change or otherwise), power loss, telecommunication failures, criminal acts, sabotage, other intentional acts of violence, vandalism and misconduct, war, civil unrest, terrorist attacks, geopolitical events, including those related to hostilities between North and South Korea and tensions between China and Taiwan, disease and pandemics, and similar events.
Our business and the infrastructure on which our business relies is vulnerable to damage or interruption from catastrophic occurrences, such as earthquakes, tsunamis, floods, fires, extreme weather events (whether as a result of climate change or otherwise), power loss, telecommunication failures, criminal acts, sabotage, other intentional acts of violence, vandalism and misconduct, war, civil unrest, terrorist attacks, geopolitical events, including those related to hostilities between North Korea and South Korea, tensions between China and Taiwan, conflicts in the Middle East, disease and pandemics, and similar events.
Coupang, Inc. 2023 Form 10-K 36 Table of Contents Similarly, a taxing authority could assert that we are subject to tax in a jurisdiction where we believe we have not established a taxable connection, often referred to as a “permanent establishment” under international tax treaties, and such an assertion, if successful, could increase our expected tax liability in one or more jurisdictions.
Coupang, Inc. 2024 Form 10-K 38 Table of Contents Similarly, a taxing authority could assert that we are subject to tax in a jurisdiction where we believe we have not established a taxable connection, often referred to as a “permanent establishment” under international tax treaties, and such an assertion, if successful, could increase our expected tax liability in one or more jurisdictions.
Coupang, Inc. 2023 Form 10-K 26 Table of Contents Coupang Corp.’s transactions with its subsidiaries and affiliates may be restricted under Korean fair trade regulations.
Coupang, Inc. 2024 Form 10-K 26 Table of Contents Coupang Corp.’s transactions with its subsidiaries and affiliates may be restricted under Korean fair trade regulations.
Likewise, these increased costs may cause suppliers and independent contractors to pass costs on to us and our customers by increasing prices, which would likely cause order volume to decline, and may cause suppliers or independent contractors to cease operations altogether. We rely on our merchants to provide a remarkable experience to our customers.
Likewise, these increased costs may cause suppliers and independent contractors to pass costs on to us and our customers by increasing prices, which would likely cause order volume to decline, and may cause suppliers or independent contractors to cease operations altogether. We rely on our merchants to provide a high quality experience to our customers.
Our revolving credit facility also contains covenants requiring us to maintain certain financial ratios. The provisions of our revolving credit facility may affect our ability to obtain future financing and to pursue attractive business opportunities and our flexibility in planning for, and reacting to, changes in business conditions.
Our revolving credit facility also contains covenants requiring us to maintain certain financial ratios. The provisions of our revolving credit facility and the Farfetch Term Loans may affect our ability to obtain future financing and to pursue attractive business opportunities and our flexibility in planning for, and reacting to, changes in business conditions.
Risks Related to Doing Business in Korea There are special risks involved with investing in Korean companies, including the possibility of restrictions being imposed by the Korean government in emergency circumstances, accounting and corporate disclosure standards that differ from those in other jurisdictions, and the risk of direct or vicarious criminal liability for executive officers of our Korean affiliates.
Risks Related to Doing Business in Korea There are special risks involved with investing in companies with Korean operations, including the possibility of restrictions being imposed by the Korean government in emergency circumstances, accounting and corporate disclosure standards that differ from those in other jurisdictions, and the risk of direct or vicarious criminal liability for executives of our Korean affiliates.
We use, and expect to continue to use, open source software in our software and systems. The licenses applicable to open source software typically require that the source code subject to the license be made available to the public and that any modifications or derivative works to open source software continue to be licensed under open source licenses.
We use, and expect to continue to use, open source software in our software and systems. Some licenses applicable to open source software may require that the source code subject to the license be made available to the public and that any modifications or derivative works to open source software continue to be licensed under open source licenses.
To effectively manage our growth, we must successfully implement our operational plans and strategies, improve and expand our infrastructure, and expand, train, and manage our employee and contractor base.
To effectively manage our growth, we must successfully implement our operational plans and strategies, improve and expand our infrastructure and supplier relationships, and expand, train, and manage our employee and contractor base.
There have been and there may be future delays or increased costs associated with the spread and impact of ongoing or future pandemics or endemics, natural or man-made disasters, extreme weather conditions, and other catastrophic events.
There have been and there may be future delays or increased costs associated with the spread and impact of ongoing or future pandemics or endemics, natural or man-made disasters, labor union activities, extreme weather conditions, and other catastrophic events.
Coupang, Inc. 2023 Form 10-K 22 Table of Contents Our business could be disrupted by catastrophic occurrences and similar events.
Coupang, Inc. 2024 Form 10-K 22 Table of Contents Our business could be disrupted by catastrophic occurrences and similar events.
The provisions would not apply to suits brought to enforce a duty or liability created by the Securities Act, the Exchange Act or any other claim for which the U.S. federal courts have exclusive jurisdiction. Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all such Securities Act actions.
The provisions would not apply to suits brought to enforce a duty or liability created by the Securities Act, the Exchange Act or any other claim for which the United States federal courts have exclusive jurisdiction. Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all such Securities Act actions.
Affected indices include the Russell 2000 and the S&P 500, S&P MidCap 400, and S&P SmallCap 600, which together make up the S&P Composite 1500.
Affected indices included the Russell 2000 and the S&P 500, S&P MidCap 400, and S&P SmallCap 600, which together make up the S&P Composite 1500.
Our results of operations and financial condition may be adversely affected by governmental regulation and associated environmental and regulatory costs. Our business is subject to a wide range of laws and regulations related to environmental and other matters. Such laws and regulations have become increasingly stringent over time.
Our results of operations and financial condition may be adversely affected by governmental regulation and associated regulatory costs related to the environment and climate change. Our business is subject to a wide range of laws and regulations related to environmental and other matters. Such laws and regulations have become increasingly stringent over time.
In addition, U.S. public companies are required to maintain records that accurately and fairly represent their transactions and have an adequate system of internal accounting controls. In many foreign countries, including countries in which we may conduct business, it may be a local custom that businesses engage in practices that are prohibited by applicable laws and regulations.
In addition, the United States public companies are required to maintain records that accurately and fairly represent their transactions and have an adequate system of internal accounting controls. In many foreign countries, including countries in which we may conduct business, it may be a local custom that businesses engage in practices that are prohibited by applicable laws and regulations.
Our industry is also characterized by rapidly changing technology, including artificial intelligence or AI, new mobile applications and protocols, new products and services, new media and entertainment content, including user-generated content, and changing consumer demands and trends.
Our industry is also characterized by rapidly changing technology, including AI, new mobile applications and protocols, new products and services, new media and entertainment content, including user-generated content, and changing consumer demands and trends.
If we continue to add fulfillment and logistics capabilities, add new offerings with different fulfillment or logistics requirements, or change the mix of merchandise that we sell, our fulfillment and logistics infrastructure will become increasingly complex, and operating it will become more challenging.
If we continue to add fulfillment and logistics capabilities, add new offerings with different fulfillment or logistics requirements, expand into additional geographies, or change the mix of merchandise that we sell, our fulfillment and logistics infrastructure will become increasingly complex, and operating it will become more challenging.
In Korea, company executive officers being named in such investigations or proceedings is a common occurrence, even though in practice many such cases result in no liability to the individual.
In Korea, company executives being named in such investigations or proceedings is a common occurrence, even though in practice many such cases result in no liability to the individual.
The frequency of such claims is unpredictable. We could experience diversion of attention by management to address these claims, and such claims can result in significant costs to investigate and defend, regardless of their merits. These claims could adversely affect our business, financial condition, and results of operations.
We could experience diversion of attention by management to address these claims, and such claims can result in significant costs to investigate and defend, regardless of their merits. These claims could adversely affect our business, financial condition, and results of operations.
Coupang, Inc. 2023 Form 10-K 35 Table of Contents Risks Related to Taxes Changes in the tax treatment of companies engaged in online retail may adversely affect the commercial use of our apps and websites and our financial results.
Coupang, Inc. 2024 Form 10-K 37 Table of Contents Risks Related to Taxes Changes in the tax treatment of companies engaged in online retail may adversely affect the commercial use of our apps and websites and our financial results.
All of our shares of Class B common stock, which has 29 votes per share, are beneficially held by Bom Kim, our Founder and Chief Executive Officer. Our Class A common stock, which is the stock we list on the NYSE, has one vote per share.
All of our shares of Class B common stock, which has 29 votes per share, are beneficially owned by Mr. Kim, our Founder and Chief Executive Officer. Our Class A common stock, which is the stock we list on the NYSE, has one vote per share.
It is difficult to predict how market forces or Korean or U.S. government policy, including any interest rate increases by the Federal Reserve, may impact the exchange rate between the KRW and the USD in the future.
It is difficult to predict how market forces or Korean or the United States government policy, including any interest rate increases by the Federal Reserve, may impact the exchange rate between the KRW and the USD in the future.
If the payment of outstanding amounts under our revolving credit facility is accelerated, our assets may be insufficient to repay such amounts in full, and our common stockholders could experience a partial or total loss of their investment.
If the payment of outstanding amounts under our revolving credit facility, Farfetch Term Loans, or other credit agreements is accelerated, our assets may be insufficient to repay such amounts in full, and our common stockholders could experience a partial or total loss of their investment.
We face additional risks in connection with acquisitions, including that: • an acquisition may negatively affect our financial condition and results of operations because it may require us to incur charges or assume substantial debt or other liabilities, may cause adverse tax consequences or unfavorable accounting treatment, may expose us to claims and disputes by stockholders and third parties, including intellectual property claims and disputes, or may not generate sufficient financial return to offset additional costs and expenses related to the acquisition; • we may encounter difficulties or unforeseen expenditures in integrating the business, technologies, data security, products, personnel, accounting or operations of any company that we acquire, particularly if key personnel of the acquired company decide not to work for us; • an acquisition may disrupt our ongoing business, divert resources, increase our expenses, and distract our management; • an acquisition may result in a delay or reduction of customer purchases for both us and the company acquired due to customer uncertainty about continuity and effectiveness of service from us or the acquired company; • we may encounter difficulties in selling or utilizing any acquired products or services, or we may be unable to do so successfully or at all; • our use of cash to pay for acquisitions would limit other potential uses for our cash; • if we incur debt to fund an acquisition, such debt may subject us to material restrictions on our ability to conduct our business, or require us to comply with certain financial maintenance covenants which may adversely affect our ability to conduct our business; and • if we issue a significant amount of equity securities in connection with future acquisitions, existing stockholders may be diluted and earnings per share may decrease or losses per share may increase.
We face additional risks in connection with acquisitions, including that: • an acquisition may negatively affect our financial condition and results of operations because it may require us to incur charges or assume substantial debt or other liabilities, may cause adverse tax consequences or unfavorable accounting treatment, may expose us to claims and disputes by stockholders and third parties, including intellectual property claims and disputes, or may not generate sufficient financial return to offset additional costs and expenses related to the acquisition; • we may encounter difficulties or unforeseen expenditures in integrating the business, technologies, data security, products, personnel, accounting or operations of any company that we acquire, particularly if key personnel of the acquired company decide not to work for us; • commitments, liabilities, deficiencies and other risks associated with acquired businesses may not be identified or may be underestimated; • potential exposure to new or increased regulatory oversight and uncertain or evolving legal, regulatory and compliance requirements associated with acquired businesses; • an acquisition may disrupt our ongoing business, divert resources, increase our expenses, and distract our management; • an acquisition may result in a delay or reduction of customer purchases for both us and the company acquired due to customer uncertainty about continuity and effectiveness of service from us or the acquired company; • we may encounter difficulties in selling or utilizing any acquired products or services, or we may be unable to do so successfully or at all; • potential write-offs or impairment of goodwill or other acquisition-related intangible assets; • our use of cash to pay for acquisitions would limit other potential uses for our cash; • if we incur debt to fund an acquisition, such debt may subject us to material restrictions on our ability to conduct our business, or require us to comply with certain financial maintenance covenants which may adversely affect our ability to conduct our business; and • if we issue a significant amount of equity securities in connection with future acquisitions, existing stockholders may be diluted and earnings per share may decrease or losses per share may increase.
Any such failure could result in investors losing confidence in the accuracy and completeness of our financial reports, the market price of our Class A common stock could be adversely affected, and we could become subject to litigation or investigations by the New York Stock Exchange (the “NYSE”), the SEC, Korean authorities, or other regulatory authorities, which could require additional financial and management resources and materially and adversely affect our business and results of operations.
Any such failure could result in investors losing confidence in the accuracy and completeness of our financial reports, could cause us to violate covenants in our debt instruments or other reporting obligations, the market price of our Class A common stock could be adversely affected, and we could become subject to litigation or investigations by the New York Stock Exchange (the “NYSE”), the SEC, Korean authorities, or other regulatory authorities, which could require additional financial and management resources and materially and adversely affect our business and results of operations.
As a result, it may be more difficult for investors to effect service of process in the United States upon it or its directors or executive officers or to enforce against it or its directors or executive officers judgments obtained in U.S. courts predicated upon civil liability provisions of the federal or state securities laws of the United States or similar judgments obtained in other courts outside Korea.
As a result, it may be more difficult for investors to effect service of process in the United States upon it or its executives or to enforce against it or its executives judgments obtained in the United States courts predicated upon civil liability provisions of the federal or state securities laws of the United States or similar judgments obtained in other courts outside Korea.
Any failure to accurately predict revenue or to control our expenses could adversely affect our results of operations in any given quarter, or a series of quarters, which could cause the price per share of our Class A common stock to decline. We may experience significant fluctuations in our results of operations.
Any failure to accurately predict revenue or to control our expenses could adversely affect our results of operations in any given quarter, or a series of quarters, which could cause the price per share of our Class A common stock to decline.
Our strategy is to continue to build on our market position by continuing to implement certain key strategic initiatives, which include the following: • building our brand and further expanding our customer base; • providing high-quality merchandise and services at attractive prices; • focusing on customer satisfaction and our customers’ loyalty to our apps, websites, and programs, including our Rocket WOW membership program; • expanding our product offerings; and • enhancing our apps and websites and developing personalization tools to enhance our customers’ experience with our apps and websites.
Our strategy is to continue to build on our market position by continuing to implement certain key strategic initiatives, which include the following: • building our brand and further expanding our customer base; • providing high-quality merchandise and services at attractive prices; • focusing on customer satisfaction and our customers’ loyalty to our apps, websites, and programs, including our Rocket WOW membership program; • expanding our product offerings; and Coupang, Inc. 2024 Form 10-K 10 Table of Contents • enhancing our apps and websites and developing personalization tools to enhance our customers’ experience with our apps and websites.
We are subject to audit by U.S. and foreign tax authorities. Such tax authorities may disagree with tax positions we take, and if any such tax authority were to successfully challenge any such position, our business could be adversely impacted.
We are subject to audit by the United States and foreign tax authorities. Such tax authorities may disagree with tax positions we take, and if any such tax authority were to successfully challenge any such position, our business could be adversely impacted.
Coupang Corp. enters into business relationships and transactions with its subsidiaries and affiliates, which are subject to scrutiny by the Korean Fair Trade Commission (the “KFTC”) as to, among other things, whether such relationships and transactions constitute undue financial support among companies in the same business group.
Coupang Corp. enters into business relationships and transactions with its subsidiaries and affiliates, which are subject to scrutiny by the KFTC as to, among other things, whether such relationships and transactions constitute undue financial support among companies in the same business group.
We may expand our operations and offerings into new geographies, which would present new challenges and which may prove unsuccessful and materially and adversely affect our business. As of December 31, 2023, we have operations and support services in the United States, South Korea, Taiwan, Singapore, China, Japan, and India.
We may expand our operations and offerings into new geographies, which would present new challenges and which may prove unsuccessful and materially and adversely affect our business. As of December 31, 2024, we have operations and support services in the United States, South Korea, Taiwan, Singapore, China, Japan, India, the United Kingdom, and various other European countries.
As a result of these current and changing risks, our Korean affiliates’ executive officers have in the past been named, and may be named in the future, in criminal investigations or proceedings stemming from our operations.
As a result of these current and changing risks, our executives have in the past been named, and may be named in the future, in criminal investigations or proceedings stemming from our operations.
In addition, a failure to comply with the provisions of our revolving credit facility could result in a default or an event of default that could enable our lenders to declare the outstanding principal of that debt, together with accrued and unpaid interest, to be immediately due and payable.
In addition, a failure to comply with the provisions of our revolving credit facility or the Farfetch Term Loans, as well as other credit agreements, could result in a default or an event of default that could enable our lenders to declare the outstanding principal of that debt, together with accrued and unpaid interest, to be immediately due and payable.
If we are unable to successfully implement some or all of our key strategic initiatives in an effective and timely manner, our ability to maintain and improve our market position, Coupang, Inc. 2023 Form 10-K 10 Table of Contents and our competitive position, brand, and reputation may be harmed, which may materially and adversely affect our business, financial condition, and results of operations.
If we are unable to successfully implement some or all of our key strategic initiatives in an effective and timely manner, our ability to maintain and improve our market position, and our competitive position, brand, and reputation may be harmed, which may materially and adversely affect our business, financial condition, and results of operations.
As a result, any significant depreciation of the KRW or other major foreign currencies against the USD may have a material adverse effect on our results of operations.
As a result, any significant depreciation of the KRW or other major foreign currencies against the USD may have a material adverse effect on our results of operations. A large percentage of our cash is in KRW.
In addition, our apps, Coupang, Inc. 2023 Form 10-K 31 Table of Contents websites, networks, and systems are subject to security threats, including hacking of our systems, denial-of-service attacks, viruses, malicious software, ransomware, break-ins, phishing attacks, social engineering, security breaches, or other attacks and similar disruptions that may jeopardize the security of information stored in or transmitted by our apps, websites, networks, and systems, or that we otherwise maintain.
In addition, our apps, websites, networks, and systems are subject to security threats, including hacking of our systems, denial-of-service attacks, viruses, malicious software, ransomware, break-ins, phishing attacks, social engineering, security breaches, or other attacks and similar disruptions that may jeopardize the security of information stored in or transmitted by our apps, websites, networks, and systems, or that we otherwise maintain.
Any failure, or perceived failure, by us to comply with such policies, laws, regulations, and other legal obligations and regulatory guidance could adversely affect our reputation, brand, and business, and may result in claims, proceedings, or actions, including criminal proceedings, against us and certain of our executive officers by governmental entities or others or other liabilities.
Any failure, or perceived failure, by us to comply with such policies, laws, regulations, and other legal obligations and regulatory guidance could adversely affect our reputation, brand, and Coupang, Inc. 2024 Form 10-K 33 Table of Contents business, and may result in claims, proceedings, or actions, including criminal proceedings, against us and certain of our executive officers by governmental entities or others or other liabilities.
As a result, restrictions in our revolving credit facility could adversely affect our business, financial condition, and results of operations.
As a result, restrictions in our revolving credit facility and the Farfetch Term Loans could adversely affect our business, financial condition, and results of operations.
Risks Related to Our Limited Operating History and Growth We had a history of net losses prior to our most recent fiscal year, we may incur losses in the future, and we cannot ascertain whether we will maintain profitability in future periods, which would materially and adversely affect our business, financial condition, results of operations, and prospects.
We have had a history of net losses prior to our most recent fiscal years, we may incur losses in the future, and we cannot ascertain whether we will maintain profitability in future periods, which would materially and adversely affect our business, financial condition, results of operations, and prospects.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe conduct annual assessments by certified external third-party assessors as part of our industry-recognized information security certifications, ISMS-P and ISO 27001. We also periodically have external third-party consultants conduct maturity assessments of our Information Security program. The results of these audits and assessments inform us about possible risks which are managed through our enterprise risk management process.
Biggest changeIn addition to full-time employees, external consultancy services provide us with certain information security services and specialized advice. We conduct annual assessments by certified external third-party assessors as part of our industry-recognized information security certifications, ISO 27001, 27017, 27701, and ISMS-P. We periodically have external third-party consultants conduct maturity assessments of our Information Security program.
Item 1C. Cybersecurity Coupang has a cyber risk management framework designed to assess, identify, and manage cyber related risks. Cyber related risks are identified through audits, assessments, and incidents. Our vulnerability scanning process uses both automated tools and penetration testing to identify vulnerabilities within our environment .
Item 1C. Cybersecurity Coupang has a cyber risk management framework designed to identify, assess, and manage cyber related risks. Cyber related risks are identified through self-identification, audits, assessments, and incidents. Our vulnerability scanning process uses both automated tools and penetration testing to identify vulnerabilities within our environment .
We seek to identify and manage risks from cyber threat intelligence and lessons learned from known cyber incidents with our cyber risk management process and include these within our cyber risk strategy through major technology enhancements and projects.
We seek to identify and manage risks from cyber threat intelligence and lessons learned from known cyber incidents with our cyber risk management process and include these within our cyber risk strategy through major information security and technology enhancements and projects.
We seek to identify, manage and reduce the risks and potential vulnerabilities by integrating controls and solutions into technology projects based on severity and priority.
We seek to identify, manage and reduce the risks and potential vulnerabilities by integrating controls and solutions into information security and technology projects based on severity and priority.
Risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, have not materially affected us, including our business strategy, results of operations or financial condition.
As of the date of this 10-K, risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, have not materially affected us, including our business strategy, results of operations or financial condition.
The executive leadership team provides oversight and guidance on cyber policies, procedures, and strategies. Our Board of Director’s role in risk oversight is consistent with our leadership structure, with the executive leadership team having responsibility for assessing and managing risks we face in executing our business plans, and the Board and its committees providing oversight in connection with those efforts.
Our Board of Director’s role in risk oversight is consistent with our leadership structure, with the executive leadership team having responsibility for assessing and managing risks we face in executing our business plans, and the Board and its committees providing oversight in connection with those efforts.
The CISO receives reports on cybersecurity threats from experienced information security officers in our security organization on an ongoing basis and in conjunction with management, regularly reviews risk management measures implemented by the Company to identify and mitigate data protection and cybersecurity risks.
The CISO is updated on cybersecurity threats from experienced information security officers in our security organization on an ongoing basis and in conjunction with management, regularly reviews risk management measures implemented by the Company to identify and mitigate data protection and cybersecurity risks. Supporting the CISO, is the dedicated information security team, which comprises almost 200 individuals.
The Chief Information Security Officer (“CISO”), who has extensive cybersecurity knowledge and skills gained from over 15 years of work experience at the Company and elsewhere, leads our global information security organization responsible for overseeing the Coupang information security program.
The Chief Information Security Officer (“CISO”), who has extensive cybersecurity knowledge and skills gained from over 15 years of work experience at the Company and elsewhere, leads our global information security organization responsible for overseeing the Coupang information security program. The CISO regularly reviews our cyber strategy with technology leadership in order to integrate the cyber strategy across the organization.
We also employ external third-party vendors to provide cyber threat intelligence when relevant information is available or as requested. We also employ systems and processes designed to oversee, identify, and reduce the potential impact of a security incident at a third-party vendor, service provider or customer or otherwise implicating the third-party technology and systems we use.
We also employ systems and processes designed to oversee, identify, and reduce the potential impact of a security incident at a third-party vendor, service provider, customer or otherwise implicating the third-party technology and systems we use.
Risk Factors” in this Form 10-K for additional discussion on the risks of future cyber incidents to our results of operations and financial condition.
Cybersecurity threats continue to increase, and as set out in our risk factors our services may be affected by cybersecurity and data security incidents, which could be material to the Company. See “Item 1A. Risk Factors” in this Form 10-K for additional discussion on the risks of future cyber incidents to our results of operations and financial condition.
Removed
The CISO regularly reviews our cyber strategy with technology leadership in order to assess whether the cyber strategy is integrated across the organization.
Added
The results of these audits and assessments inform us about possible risks which are managed through our enterprise risk management process. We employ external third-party vendors to provide cyber threat intelligence when relevant information is available or as requested.
Removed
Cybersecurity risks continue to increase, and as set out in our risk factors our services may be affected by cybersecurity and data security incidents, including but not limited to spyware, viruses, phishing, and other spam emails, denial of service attacks, data theft, computer intrusions, outages, and similar events, which could be material to the Company. See “Item 1A.
Added
We also have a program of Cyber Tabletop exercises, run periodically, with key people in our business, to further enhance our capabilities to respond and recover to a cyber incident. The Coupang executive leadership team provides oversight and guidance on cyber policies, procedures, and strategies.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe believe our facilities are adequate and suitable for our current needs and that, should it be needed, suitable additional or alternative space will be available to accommodate our operations.
Biggest changeWe believe our facilities are adequate and suitable for our current needs and that, should it be needed, suitable additional or alternative space will be available to accommodate our operations. Coupang, Inc. 2024 Form 10-K 42 Table of Contents
Item 2. Properties We lease our principal executive office in Seattle, Washington and additional office space in Korea, the United States, and throughout Asia. We lease or own over 55 million square feet of fulfillment and logistics space throughout Korea, as well as other parts of Asia and the United States.
Item 2. Properties We lease our principal executive office in Seattle, Washington and additional office space in Korea, the United States, Europe, and throughout Asia. We lease or own over 67 million square feet of fulfillment and logistics space throughout Korea, as well as other parts of Asia and the United States.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeWe have received, and may in the future continue to receive, claims, litigation, governmental audits, inspections, and investigations relating to issues such as employment and labor, worker classification and assignment, worker pay, hours and benefits, labor relations including union and collective bargaining issues, employment authorization and immigration, health and safety, workplace harassment, workplace sexual harassment, intellectual property (including patent, trademark, and copyright), product safety, personal injury, privacy, information security, tax compliance, Coupang, Inc. 2023 Form 10-K 40 Table of Contents import/export regulations, foreign exchange regulations, licenses and permits, food safety, medical products, drugs and devices, financial services, antitrust and fair trade matters, consumer protection, and environmental issues.
Biggest changeWe have received, and may in the future continue to receive, claims, litigation, governmental audits, inspections, and investigations relating to issues such as employment and labor, worker classification and assignment, worker pay, hours and benefits, labor relations including union and collective bargaining issues, employment authorization and immigration, health and safety, workplace harassment, workplace sexual harassment, intellectual property (including patent, trademark, and copyright), product safety, personal injury, privacy, information security, tax compliance, import/export regulations, foreign exchange regulations, licenses and permits, food safety, medical products, drugs and devices, financial services, antitrust and fair trade matters, consumer protection, and environmental issues.
The most significant of our current legal proceedings are described in Note 13 — "Commitments and Contingencies", in Part II, Item 8 - “Financial Statements and Supplementary Data”, and risks relating to legal matters are described elsewhere in this Form 10-K, see “Item 1A. Risk Factors.” Item 4. Mine Safety Disclosures Not applicable.
The most significant of our current legal proceedings are described in Note 14 — "Commitments and Contingencies", in Part II, Item 8 - “Financial Statements and Supplementary Data”, and risks relating to legal matters are described elsewhere in this Form 10-K, see “Item 1A. Risk Factors.” Item 4. Mine Safety Disclosures Not applicable.
Coupang, Inc. 2023 Form 10-K 41 Table of Contents PART II
Coupang, Inc. 2024 Form 10-K 43 Table of Contents PART II

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures 41 PART II Item 5 . Market for the Registrant’s Common Stock, Related Stockholder Matters and Issuer Purchases of Equity Securities 42 Item 6 . [Reserved] 42 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 43 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 55 Item 8.
Biggest changeItem 4. Mine Safety Disclosures 43 PART II Item 5 . Market for the Registrant’s Common Stock, Related Stockholder Matters and Issuer Purchases of Equity Securities 44 Item 6 . [Reserved] 44 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 45 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 58 Item 8.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeHolders of Common Stock As of February 22, 2024, there were 37 holders of record of our Class A common stock and one holder of record of our Class B common stock.
Biggest changeHolders of Common Stock As of February 20, 2025, there were 27 holders of record of our Class A common stock and one holder of record of our Class B common stock.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeCoupang, Inc. 2023 Form 10-K 45 Table of Contents Reconciliation of GAAP to Non-GAAP Measures Free Cash Flow (in millions) 2023 2022 Net cash provided by operating activities $ 2,652 $ 565 Adjustments: Purchases of land and buildings (374) (226) Purchases of equipment (522) (598) Total purchases of property and equipment $ (896) $ (824) Proceeds from sale of property and equipment 19 13 Total adjustments $ (877) $ (811) Free cash flow $ 1,775 $ (246) Net cash used in investing activities $ (927) $ (848) Net cash provided by financing activities $ 199 $ 247 Adjusted EBITDA and Adjusted EBITDA Margin (in millions) 2023 2022 Total net revenues $ 24,383 $ 20,583 Net income (loss) 1,360 (92) Net income (loss) margin 5.6 % (0.4) % Adjustments: Depreciation and amortization 275 231 Interest expense 48 27 Interest income (178) (53) Income tax benefit (776) (1) Other expense, net 19 7 Equity-based compensation 326 262 Adjusted EBITDA $ 1,074 $ 381 Adjusted EBITDA margin 4.4 % 1.9 % Constant Currency Revenue and Constant Currency Revenue Growth 2023 2022 Year over Year Growth (in millions) As Reported Exchange Rate Effect Constant Currency Basis As Reported As Reported Constant Currency Basis Consolidated Net retail sales $ 21,223 $ 221 $ 21,444 $ 18,338 16 % 17 % Net other revenue 3,160 33 3,193 2,245 41 % 42 % Total net revenues $ 24,383 $ 254 $ 24,637 $ 20,583 18 % 20 % Net Revenues by Segment Product Commerce $ 23,594 $ 246 $ 23,840 $ 19,955 18 % 19 % Developing Offerings 789 8 797 628 26 % 27 % Total net revenues $ 24,383 $ 254 $ 24,637 $ 20,583 18 % 20 % Certain amounts may not foot due to rounding.
Biggest changeCoupang, Inc. 2024 Form 10-K 51 Table of Contents Reconciliation of GAAP to Non-GAAP Measures Free Cash Flow (in millions) 2024 2023 Net cash provided by operating activities $ 1,886 $ 2,652 Adjustments: Purchases of land and buildings (245) (374) Purchases of equipment (634) (522) Total purchases of property and equipment $ (879) $ (896) Proceeds from sale of property and equipment 9 19 Total adjustments $ (870) $ (877) Free cash flow $ 1,016 $ 1,775 Net cash used in investing activities $ (819) $ (927) Net cash (used in) provided by financing activities $ (69) $ 199 Adjusted EBITDA and Adjusted EBITDA Margin (in millions) 2024 2023 Total net revenues $ 30,268 $ 24,383 Net income 66 1,360 Net income margin 0.2 % 5.6 % Adjustments: Depreciation and amortization 433 275 Interest expense 140 48 Interest income (216) (178) Income tax expense (benefit) 407 (776) Other expense, net 39 19 Acquisition and restructuring related costs 127 — KFTC administrative fine 121 — FC Fire insurance gain (175) — Equity-based compensation 433 326 Adjusted EBITDA $ 1,375 $ 1,074 Adjusted EBITDA margin 4.5 % 4.4 % Constant Currency Revenue and Constant Currency Revenue Growth 2024 2023 Year over Year Growth (in millions) As Reported Exchange Rate Effect Constant Currency Basis As Reported As Reported Constant Currency Basis Consolidated Net retail sales $ 23,866 $ 1,039 $ 24,905 $ 21,223 12 % 17 % Net other revenue 6,402 245 6,647 3,160 103 % 110 % Total net revenues $ 30,268 $ 1,284 $ 31,552 $ 24,383 24 % 29 % Net Revenues by Segment Product Commerce $ 26,699 $ 1,197 $ 27,896 $ 23,594 13 % 18 % Developing Offerings 3,569 85 3,654 789 352 % 363 % Total net revenues $ 30,268 $ 1,284 $ 31,552 $ 24,383 24 % 29 % Certain amounts may not foot due to rounding.
Segment adjusted EBITDA is defined as income (loss) before income taxes for a period before depreciation and amortization, interest expense, interest income, income tax expense (benefit), other income (expense), net, equity-based compensation, impairments, and other items that we do not believe are reflective of our ongoing operations associated with our segments.
Segment Adjusted EBITDA Segment adjusted EBITDA is defined as income (loss) before income taxes for a period before depreciation and amortization, interest expense, interest income, income tax expense (benefit), other income (expense), net, equity-based compensation, impairments, and other items that we do not believe are reflective of our ongoing operations associated with our segments.
The Term Loans contain customary affirmative covenants as well as customary negative covenants, including, but not limited to, restrictions on certain entities within Farfetch’s ability to incur additional debt, make investments, make distributions, dispose of assets, or enter into certain types of related party transactions.
The Farfetch Term Loans contain customary affirmative covenants as well as customary negative covenants, including, but not limited to, restrictions on certain entities within Farfetch’s ability to incur additional debt, make investments, make distributions, dispose of assets, or enter into certain types of related party transactions.
In estimating these rates, we review rates of return on high-quality corporate bond indices, which approximate the timing and amount of benefit payments. Assuming all other defined benefit plan assumptions remain constant, a one percentage point decrease in the discount rates would result in an immaterial change in benefit plan expense during 2024.
In estimating these rates, we review rates of return on high-quality corporate bond indices, which approximate the timing and amount of benefit payments. Assuming all other defined benefit plan assumptions remain constant, a one percentage point decrease in the discount rates would result in an immaterial change in benefit plan expense during 2025.
A customer is anyone who has created an account on our apps or websites, identified by a unique email address. The change in Active Customers in a reported period captures both the inflow of new customers as well as the outflow of existing customers who have not made a purchase in the period.
A customer is anyone who has created an account on our apps or websites, identified by a unique email address. The change in Product Commerce Active Customers in a reported period captures both the inflow of new customers as well as the outflow of existing customers who have not made a purchase in the period.
This minimum tax will be treated as a period cost in future years and did not impact operating results for 2023. We are continuing to monitor legislative developments and are in the process of evaluating the potential impact of Korean and other legislation on our results of future operations.
This minimum tax will be treated as a period cost in future years and did not impact operating results for 2024. We are continuing to monitor legislative developments and are in the process of evaluating the potential impact of Korean and other legislation on our results of future operations.
The acquisition method of accounting requires us to exercise judgment and make significant estimates and assumptions regarding the fair values of the elements of a business combination as of the date of acquisition, including the estimated fair values of identifiable tangible and intangible assets, liabilities assumed, non-controlling interests, deferred tax asset valuation allowances, liabilities related to uncertain tax positions, and contingencies.
The acquisition method of accounting requires us to exercise judgment and make significant estimates and assumptions regarding the fair values of the elements of a business combination as of the date of acquisition, including the estimated fair values of identifiable tangible and intangible assets, liabilities assumed, noncontrolling interests, deferred tax asset valuation allowances, liabilities related to uncertain tax positions, and contingencies.
As part of this expansion to fulfill anticipated future customer demand and continuation to expand services, we plan to build new fulfillment centers. We have entered into various new construction contracts for capital projects which are expected to be completed over the next three years. These contracts have remaining capital expenditures commitments of $114 million as of December 31, 2023.
As part of this expansion to fulfill anticipated future customer demand and continuation to expand services, we plan to build new fulfillment centers. We have entered into various new construction contracts for capital projects which are expected to be completed over the next three years. These contracts have remaining capital expenditures commitments of $306 million as of December 31, 2024.
Refer to Note 13 — "Commitments and Contingencies", Note 5 — "Defined Severance Benefits", and Note 10 — "Leases" in Part II, Item 8 - “Financial Statements and Supplementary Data” for disclosure of our future commitments. Our short-term and long-term borrowings generally include lines of credit with financial institutions available to be drawn upon for general operating purposes.
Refer to Note 14 — "Commitments and Contingencies", Note 5 — "Defined Severance Benefits", and Note 11 — "Leases" in Part II, Item 8 — “Financial Statements and Supplementary Data” for disclosure of our future commitments. Our short-term and long-term borrowings generally include lines of credit with financial institutions available to be drawn upon for general operating purposes.
Coupang, Inc. 2023 Form 10-K 53 Table of Contents Assuming all other defined benefit plan assumptions remain constant, a one percentage point decrease in the salary growth rates would result in an immaterial change in benefit plan expense during 2024. Business Combinations In January 2024, the Farfetch Acquisition was completed.
Assuming all other defined benefit plan assumptions remain Coupang, Inc. 2024 Form 10-K 56 Table of Contents constant, a one percentage point decrease in the salary growth rates would result in an immaterial change in benefit plan expense during 2025. Business Combinations In January 2024, the Farfetch Acquisition was completed.
The Revolving Credit Agreement and Revolving Credit Facility both require us to (i) maintain a ratio of secured indebtedness to total consolidated tangible assets of less than 35%, if we have $1 or more of revolving loans or any unreimbursed drawn letters of credit outstanding under the Revolving Credit Agreement or Revolving Credit Facility at the end of each fiscal quarter and (ii) maintain a minimum amount of liquidity of at least $625 million (or $313 million to the extent the aggregate commitment of the Revolving Credit Agreement or Revolving Credit Facility, respectively, is $500 million).
The Revolving Credit Facility requires us to (i) maintain a ratio of secured indebtedness to total consolidated tangible assets of less than 35%, if we have $1 or more of revolving loans or any unreimbursed drawn letters of credit outstanding under the Revolving Credit Facility at the end of each fiscal quarter and (ii) maintain a minimum amount of liquidity of at least $625 million (or $313 million to the extent the aggregate commitment of the Revolving Credit Facility is $500 million).
Recently Adopted Accounting Pronouncements See Note 1 — "Basis of Presentation and Summary of Significant Accounting Policies" to the consolidated financial statements included elsewhere in Part II, Item 8 of this Annual Report on Form 10-K. Coupang, Inc. 2023 Form 10-K 54 Table of Contents
Recently Adopted Accounting Pronouncements See Note 1 — "Basis of Presentation and Summary of Significant Accounting Policies" to the consolidated financial statements included elsewhere in Part II, Item 8 of this Annual Report on Form 10-K. Coupang, Inc. 2024 Form 10-K 57 Table of Contents
As of December 31, 2023, we determined the salary growth rates for the severance benefit plan used in determining the projected and accumulated benefit obligations to be 5.00% to 7.00%, as compared to 5.00% to 8.00% as of December 31, 2022. In estimating these rates, we review our historical and expected rates as well as industry growth rates.
As of December 31, 2024 and 2023, we determined the salary growth rates for the severance benefit plan used in determining the projected and accumulated benefit obligations to be 5.00% to 7.00%. In estimating these rates, we review our historical and expected rates as well as industry growth rates.
Additionally, we have: • operating leases that have not commenced with future minimum lease payments of $355 million with non-cancellable lease terms of 1 to 10 years; • expected defined severance benefits to be paid of $889 million; and • open purchase orders for inventories that are primarily due in the next twelve months, and are generally cancellable, in full or in part, through the contractual provisions.
Additionally, we have: • operating leases that have not commenced with future minimum lease payments of $215 million with non-cancellable lease terms of 2 to 10 years; • expected defined severance benefits to be paid of $981 million; and • open purchase orders for inventories that are primarily due in the next twelve months, and are generally cancellable, in full or in part, through the contractual provisions.
A discussion regarding our financial condition and results of operations for 2022 compared to 2021 can be found under Part II, Item 7 — “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for 2022.
(2) Non-meaningful. A discussion regarding our financial condition and results of operations for 2023 compared to 2022 can be found under Part II, Item 7 — “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for 2023.
Adjusted EBITDA • Net income (loss), excluding the effects of: - depreciation and amortization, - interest expense, - interest income, - other income (expense), net, - income tax expense (benefit), - equity-based compensation, - impairments, and - other items not reflective of our ongoing operations. • Provides information to management evaluate and assess our performance and allocate internal resources. • We believe Adjusted EBITDA and Adjusted EBITDA Margin are frequently used by investors and other interested parties in evaluating companies in the retail industry for period-to-period comparisons as they remove the impact of certain items that are not representative of our ongoing business, such as material non-cash items and certain variable charges.
Adjusted EBITDA • Net income (loss), excluding the effects of: - depreciation and amortization, - interest expense, - interest income, - other income (expense), net, - income tax expense (benefit), - equity-based compensation, - impairments, and - other items not reflective of our ongoing operations. • Provides information to management to evaluate and assess our performance and allocate internal resources. • We believe Adjusted EBITDA and Adjusted EBITDA Margin are frequently used by investors and other interested parties in evaluating companies in the retail industry for period-to-period comparisons as they remove the impact of certain items that are not representative of our ongoing business, such as material non-cash items, acquisition-related transaction and restructuring costs, significant costs related to certain non-ordinary course legal and regulatory matters, and certain variable charges.
Additionally, cost of sales includes outbound shipping and logistics related expenses, delivery costs from our restaurant delivery business, and depreciation and amortization expense. The increase in cost of sales primarily reflects higher volume from increased sales and customer demand.
Additionally, cost of sales includes outbound shipping and logistics related expenses, delivery costs from our restaurant delivery business, and depreciation and amortization expense. The increase in cost of sales primarily reflects higher volume from increased sales and customer demand. Additionally, the acquisition of Farfetch increased cost of sales by $945 million.
We expect that our investment into our growth strategy will continue to be significant, particularly with respect to our Developing Offerings segment, which will continue to focus on our newer offerings and entrance into new geographies, as well as overall expansion of our fulfillment, logistics, and technology capabilities.
We may incur losses in the future. We expect that our investment into our growth strategy will continue to be significant, particularly with respect to our Developing Offerings segment, which will continue to focus on our newer offerings and entrance into new geographies, as well as overall expansion of our fulfillment, logistics, and technology capabilities.
Our effective income tax rate changed from an expense of 1.1% in 2022 to a benefit of (133.1)% in 2023 due to the release of the valuation allowance for our Korean deferred tax assets in 2023.
Our effective income tax rate changed from a benefit of (133.1)% in 2023 to an expense of 86.0% in 2024 primarily due to the release of the valuation allowance for our Korean deferred tax assets in 2023.
Liquidity and Capital Resources Liquidity Liquidity is a measure of our ability to access sufficient cash flows to meet the short-term and long-term cash requirements of our business operations. Our primary sources of liquidity are cash on hand, supplemented through various debt financing arrangements and sales of our equity securities.
Coupang, Inc. 2024 Form 10-K 52 Table of Contents Liquidity and Capital Resources Liquidity Liquidity is a measure of our ability to access sufficient cash flows to meet the short-term and long-term cash requirements of our business operations. Our primary sources of liquidity are cash on hand, supplemented through various debt financing arrangements and sales of our equity securities.
We defer a portion of revenue from each originating transaction, based on the estimated standalone selling price of the loyalty reward earned, and then recognize the revenue as the loyalty reward is redeemed in a future transaction, or when they expire.
We defer a portion of revenue from each originating transaction, based on the estimated standalone selling price of the loyalty reward earned, and then recognize the revenue as the loyalty reward is redeemed in a future transaction, or when they expire. The amount of the deferred revenue related to these loyalty rewards is not material.
This valuation requires management judgments, based on currently available Coupang, Inc. 2023 Form 10-K 52 Table of Contents information, about the likely method of disposition, such as through sales to individual customers, returns to product suppliers, or liquidations, and expected recoverable values of separate inventory categories.
This valuation requires management judgments, based on currently available information, about the likely method of disposition, such as through sales to individual customers, returns to product suppliers, or liquidations, and expected recoverable values of separate inventory categories.
As of December 31, 2023, we determined the discount rates for the severance benefit plan used in determining the projected and accumulated benefit obligations to be 4.30% to 4.80%, as compared to 5.10% to 5.30% as of December 31, 2022.
As of December 31, 2024, we determined the discount rates for the severance benefit plan used in determining the projected and accumulated benefit obligations to be 3.50% to 3.90%, as compared to 4.30% to 4.80% as of December 31, 2023.
Developing Offerings primarily includes more nascent offerings and services, including Coupang Eats, our restaurant ordering and delivery service in Korea, Coupang Play, our online content streaming service in Korea, fintech, our retail operations in Taiwan, as well as advertising products associated with these offerings.
Developing Offerings includes more nascent offerings and services, including Coupang Eats, our restaurant ordering and delivery service in Korea, Coupang Play, our online content streaming service in Korea, fintech, our retail operations in Taiwan, as well as advertising products associated with these offerings, and also includes Farfetch, our newly acquired global luxury fashion marketplace.
Capital Resources We have entered into material unconditional purchase obligations. These contractual commitments primarily relate to technology related service contracts, fulfillment center construction contracts, and software licenses. We generally enter into term loan facility agreements to finance the construction of our fulfillment centers.
This financing may not be available on favorable terms, or at all. Capital Resources We have entered into material unconditional purchase obligations. These contractual commitments primarily relate to technology related service contracts, fulfillment center construction contracts, and software licenses. We generally enter into term loan facility agreements to finance the construction of our fulfillment centers.
Actuarial valuations are used in determining amounts recognized in the financial statements for our severance benefit plans. These valuations incorporate the following significant assumptions: • discount rates; and • salary growth rates Management believes that these assumptions are critical accounting estimates because significant changes in these assumptions could impact our results of operations and financial position.
These valuations incorporate the following significant assumptions: • discount rates; and • salary growth rates Management believes that these assumptions are critical accounting estimates because significant changes in these assumptions could impact our results of operations and financial position.
The ability of certain subsidiaries to transfer funds or pay dividends to Coupang, Inc. is also restricted due to terms which require the subsidiaries to meet certain financial covenants, including requirements to maintain a positive net equity balance or having current period income.
The ability of certain subsidiaries to transfer funds or pay dividends to Coupang, Inc. is also restricted due to terms which require the subsidiaries to meet certain financial covenants, including requirements to maintain a positive net equity balance or having current period income. As of December 31, 2024 and 2023, we had stockholders’ equity of $4.1 billion.
However, management believes that certain non-GAAP financial measures provide investors with additional useful information in evaluating our performance. These non-GAAP financial measures may be different than similarly titled measures used by other companies. Our non-GAAP financial measures should not be considered in isolation from, or as substitutes for, financial information prepared in accordance with U.S. GAAP.
These non-GAAP financial measures may be different than similarly titled measures used by other companies. Our non-GAAP financial measures should not be considered in isolation from, or as substitutes for, financial information prepared in accordance with U.S. GAAP.
Inventories We account for our inventories, which consist of products available for sale, using the weighted average cost method, and value them at the lower of cost or net realizable value.
Coupang, Inc. 2024 Form 10-K 55 Table of Contents Inventories We account for our inventories, which consist of products available for sale, using the weighted average cost method, and value them at the lower of cost or net realizable value.
We also have material operating Coupang, Inc. 2023 Form 10-K 50 Table of Contents leases which expire over the next ten years as well as obligations for our debts. Total minimum contractual commitments due within the next 12 months were $1.0 billion as of December 31, 2023.
We also have material operating leases which expire over the next ten years as well as obligations for our debts. Total minimum contractual commitments due within the next 12 months were $1.4 billion as of December 31, 2024.
The improvement in Product Commerce segment adjusted EBITDA was primarily due to an increase in net revenues, further operational efficiencies, improvements from supply chain optimization, and an increased percentage of revenues earned from higher margin revenue categories and offerings.
GAAP. Product Commerce The increase in Product Commerce segment adjusted EBITDA was primarily due to the increase in net revenues, improved operating efficiencies and an increased percentage of revenues earned from higher margin revenue offerings.
Coupang, Inc. 2023 Form 10-K 47 Table of Contents Fulfillment and Logistics by Coupang (“FLC”) is a Product Commerce offering that enables participating merchants to leverage our end-to-end integrated logistics and fulfillment network.
Fulfillment and Logistics by Coupang (“FLC”) is a Product Commerce offering that enables participating merchants to leverage our end-to-end integrated logistics and fulfillment network.
In the first step, recognition, we determine whether it is more-likely-than-not that a tax position will be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position. The second step addresses measurement of a tax position that meets the more-likely-than-not criteria.
We also recognize and measure uncertain tax positions taken or expected to be taken in a tax return utilizing a two-step process. In the first step, recognition, we determine whether it is more-likely-than-not that a tax position will be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position.
If we determine that our cash requirements exceed our amounts of cash on hand or if we decide to further optimize our capital structure, we may seek to issue additional debt or equity securities or obtain credit facilities or other sources of financing. This financing may not be available on favorable terms, or at all.
If we determine that our cash requirements exceed our amounts of cash on hand or if we decide to further Coupang, Inc. 2024 Form 10-K 53 Table of Contents optimize our capital structure, we may seek to issue additional debt or equity securities or obtain credit facilities or other sources of financing.
These benefits were partially offset by the impacts from our growth initiatives in developing offerings. Operating, General and Administrative Expenses Operating, general and administrative expenses include all our operating costs excluding cost of sales, as described above.
These benefits were partially offset by a (0.7)% impact from our growth initiatives in developing offerings. Coupang, Inc. 2024 Form 10-K 48 Table of Contents Operating, General and Administrative Expenses Operating, general and administrative expenses include all our operating costs excluding cost of sales, as described above.
Financing Activities The decrease was primarily driven by a $129 million decrease in proceeds from debt and short-term borrowings, partially offset by a $75 million decrease in repayments of debt and short-term borrowings due to the timing of maturities.
Financing Activities The decrease was primarily driven by a $402 million increase in repayments of debt and short-term borrowings due to the timing of maturities and the repurchase of 10 million shares of our Class A common stock for $178 million, partially offset by a $285 million increase in proceeds from debt and short-term borrowings.
See Part II, Item 8 “Financial Statements and Supplementary Data” — Note 6 — "Income Taxes" to the consolidated financial statements. Defined Severance Benefits We have severance benefits primarily related to employees in Korea. See Part II, Item 8 “Financial Statements and Supplementary Data” — Note 5 — "Defined Severance Benefits" to the consolidated financial statements.
Defined Severance Benefits We have severance benefits primarily related to employees in Korea. See Part II, Item 8 “Financial Statements and Supplementary Data” — Note 5 — "Defined Severance Benefits" to the consolidated financial statements. Actuarial valuations are used in determining amounts recognized in the financial statements for our severance benefit plans.
Repayment of the Term Loans is due in quarterly installments, of 0.25%, payable on the last business day of each fiscal quarter. The Term Loans bear interest at a rate equal to SOFR plus 6.25% per annum. Immediately following the acquisition, Farfetch repurchased $60 million of the outstanding Term Loan.
Repayment of the Farfetch Term Loans is due in quarterly installments, of 0.25% of the original principal balance, payable on the last business day of each fiscal quarter. The Farfetch Term Loans mature in October 2027, and early payment is permitted. The Farfetch Term Loans bear interest at a rate equal to SOFR plus 6.25% per annum.
Refer to Note 12 — "Short-Term Borrowings and Long-Term Debt" in Part II, Item 8 - “Financial Statements and Supplementary Data” for disclosure of our debt obligations.
Refer to Note 13 — "Short-Term Borrowings and Long-Term Debt" in Part II, Item 8 — “Financial Statements and Supplementary Data” for disclosure of our debt obligations. Critical Accounting Estimates Our consolidated financial statements are prepared in conformity with U.S.
We view the number of Active Customers as a key indicator of our potential for growth in total net revenues, the reach of our network, the awareness of our brand, and the engagement of our customers.
We view the number of Product Commerce Active Customers as an indicator of future growth in our net revenue, the reach of our network, the awareness of our brand, and the engagement of our customers.
The loans are secured against specified assets of the Farfetch group and guaranteed by certain subsidiaries of Farfetch. Refer to Note 15 — " Subsequent Event - Farfetch" in Part II, Item 8 - “Financial Statements and Supplementary Data” for further discussion. Critical Accounting Estimates Our consolidated financial statements are prepared in conformity with U.S.
The Farfetch Term Loans are secured against specified assets of the Farfetch group and guaranteed by certain subsidiaries of Farfetch. Refer to Note 16 — "Business Combinations - Farfetch" in Part II, Item 8 — “Financial Statements and Supplementary Data” for further discussion.
We had total cash, cash equivalents and restricted cash of $5.6 billion as of December 31, 2023, of which $3.9 billion was held by our foreign subsidiaries and may not be freely transferable to the U.S due to local laws or other restrictions.
We had total cash, cash equivalents and restricted cash of $6.0 billion as of December 31, 2024, the majority of which was held by our foreign subsidiaries and may not be freely transferable to the United States due to local laws or other restrictions. Additionally, we have $923 million available under our revolving credit facilities as described below.
Net Revenues per Active Customer Net revenues per Active Customer is the total net revenues generated in a period divided by the total number of Active Customers in that period. A key driver of growth is increasing the frequency and the level of spend of Active Customers who are shopping on our apps or websites.
A key driver of growth is increasing the frequency and the level of spend of customers who are shopping on our Product Commerce apps or websites.
Cost of sales as a percentage of revenue decreased from 77.1% for 2022 to 74.6% for 2023 primarily due to further operational efficiencies, continued supply chain optimization, and an increased percentage of revenues earned from higher margin revenue categories and offerings, including the enhanced FLC program.
Partially offsetting these increases was a $116 million insurance gain related to an inventory loss from the FC Fire. Cost of sales as a percentage of revenue decreased from 74.6% for 2023 to 70.8% for 2024 primarily due to an increased percentage of revenues earned from higher margin revenue categories and offerings, further operational efficiencies, and continued supply chain optimization.
Additionally, benefiting the improvement in cash used in operating activities were the changes in operating assets and liabilities, including a decrease in inventories of $323 million primarily from the implementation of the new FLC program combined with improved inventory management, and an increase in accounts payable of $1.1 billion primarily as a result of increased volume of purchases as well as improved payment terms, primarily with certain large, multi-national suppliers, partially offset by a reduction in payables from the FLC changes.
Cash provided by operating activities was also impacted by the changes in operating assets and liabilities, including a decrease in accounts payable of $1.0 billion primarily as a result of increased volume of purchases as well as improved payment terms, primarily with certain large, multi-national suppliers which occurred in 2023, and $332 million from inventories primarily from the implementation of the FLC program in the prior year, partially offset by the accrual of the administrative fine during the second quarter of 2024.
Coupang, Inc. 2023 Form 10-K 46 Table of Contents Results of Operations % Change (in millions) 2023 2022 2021 2023 vs 2022 2022 vs 2021 Net retail sales $ 21,223 $ 18,338 $ 16,488 16 % 11 % Net other revenue 3,160 2,245 1,918 41 % 17 % Total net revenues 24,383 20,583 18,406 18 % 12 % Cost of sales 18,193 15,873 15,455 15 % 3 % Operating, general and administrative 5,717 4,822 4,445 19 % 8 % Total operating cost and expenses 23,910 20,695 19,900 16 % 4 % Operating income (loss) 473 (112) (1,494) NM (1) (93) % Interest income 178 53 9 NM (1) NM (1) Interest expense (48) (27) (45) 78 % (40) % Other expense, net (19) (7) (12) 171 % (38) % Income (loss) before income taxes 584 (93) (1,542) NM (1) (94) % Income tax (benefit) expense (776) (1) 1 NM (1) NM (1) Net income (loss) $ 1,360 $ (92) $ (1,543) NM (1) (94) % (1) Non-meaningful.
Results of Operations % Change (in millions) 2024 (1) 2023 2022 2024 vs 2023 2023 vs 2022 Net retail sales $ 23,866 $ 21,223 $ 18,338 12 % 16 % Net other revenue 6,402 3,160 2,245 103 % 41 % Total net revenues 30,268 24,383 20,583 24 % 18 % Cost of sales 21,437 18,193 15,873 18 % 15 % Operating, general and administrative 8,395 5,717 4,822 47 % 19 % Total operating cost and expenses 29,832 23,910 20,695 25 % 16 % Operating income (loss) 436 473 (112) (8) % NM (2) Interest income 216 178 53 21 % NM (2) Interest expense (140) (48) (27) 192 % 78 % Other expense, net (39) (19) (7) 105 % 171 % Income (loss) before income taxes 473 584 (93) (19) % NM (2) Income tax expense (benefit) 407 (776) (1) (152) % NM (2) Net income (loss) $ 66 $ 1,360 $ (92) (95) % NM (2) (1) Includes results of operations of Farfetch from acquisition date, January 30, 2024.
See “Non-GAAP Financial Measures” and “Reconciliation of GAAP to Non-GAAP Measures” below for the reconciliation of the Non-GAAP measures with their comparable amounts prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). (2) Gross profit is calculated as total net revenues minus cost of sales. (3) Non-meaningful.
(2) Total net revenues, constant currency; total net revenues growth, constant currency; adjusted EBITDA; adjusted EBITDA margin; and free cash flow are non-GAAP measures. See “ Non-GAAP Financial Measures ” below for the reconciliation of the Non-GAAP measures with their comparable amounts prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).
Changes in our cash flows were as follows: (in millions) 2023 2022 Change Net cash provided by operating activities $ 2,652 $ 565 $ 2,087 Net cash used in investing activities $ (927) $ (848) $ (79) Net cash provided by financing activities $ 199 $ 247 $ (48) Operating Activities (in millions) 2023 2022 Change Net income (loss) $ 1,360 $ (92) $ 1,452 Adjustments to reconcile net income (loss) to net cash provided by operating activities 354 1,035 (681) Change in operating assets and liabilities 938 (378) 1,316 Net cash provided by operating activities $ 2,652 $ 565 $ 2,087 The year-over-year change in operating cash flow was primarily driven by a $1.5 billion improvement in net income (loss), which resulted in net income for the year.
Changes in our cash flows were as follows: (in millions) 2024 2023 Change Net cash provided by operating activities $ 1,886 $ 2,652 $ (766) Net cash used in investing activities $ (819) $ (927) $ 108 Net cash (used in) provided by financing activities $ (69) $ 199 $ (268) Operating Activities (in millions) 2024 2023 Change Net income $ 66 $ 1,360 $ (1,294) Adjustments to reconcile net income to net cash provided by operating activities 1,785 354 1,431 Change in operating assets and liabilities 35 938 (903) Net cash provided by operating activities $ 1,886 $ 2,652 $ (766) The year-over-year change in operating cash flow was primarily driven by a $1.3 billion decrease in net income.
Key Business Metrics Three Months Ended December 31, (in millions, except net revenues per Active Customer) 2023 2022 Active Customers 21.0 18.1 Total net revenues per Active Customer $ 312 $ 294 Active Customers As of the last date of each reported period, we determine our number of Active Customers by counting the total number of individual customers who have ordered at least once directly from our apps or websites in Korea during the relevant period.
Product Commerce Active Customers As of the last date of each reported period, we determine our number of Product Commerce Active Customers by counting the total number of individual customers who have ordered at least once directly from our Product Commerce apps or websites during the relevant period.
See Note 3 — "Segment Reporting" to the consolidated financial statements included elsewhere in Part II, Item 8 of this Annual Report on Form 10-K. Product Commerce primarily includes core Korean retail (owned inventory) and marketplace offerings (third-party merchants) and Rocket Fresh, our fresh grocery offering, as well as advertising products associated with these offerings.
Coupang, Inc. 2024 Form 10-K 45 Table of Contents Product Commerce primarily includes our core Korean retail (owned inventory) and marketplace offerings (third-party merchants) and Rocket Fresh, our fresh grocery offering, as well as advertising products associated with these offerings.
We believe that we are a preeminent online destination because of our broad selection, low prices, and exceptional delivery and customer experience across our owned inventory selection as well as products offered by third-party merchants.
Coupang’s mission is to revolutionize the everyday lives of its customers and create a world where people wonder, “How did I ever live without Coupang?” We believe that we are a preeminent retail destination because of our broad selection, low prices, and exceptional delivery and customer experience across our owned inventory selection as well as products offered by third-party merchants, in Korea.
Income Taxes We are subject to income taxes predominantly in Korea, as well as in the United States and other foreign jurisdictions in which we do business. Foreign jurisdictions have different statutory tax rates than those in the United States.
The increase in interest income was primarily due to higher interest rates in 2024 combined with our higher average cash and cash equivalent balances. Income Taxes We are subject to income taxes predominantly in Korea, as well as in the United States and other foreign jurisdictions in which we do business.
We expect that our future expenditures for both infrastructure and workforce-related costs will exceed several billion dollars over the next several years. At closing of the Farfetch Acquisition, a Coupang subsidiary provided additional cash funding to Farfetch of $150 million, and contributed the outstanding $150 million bridge loan towards the Farfetch Acquisition.
We expect that our future expenditures for both infrastructure and workforce-related costs will exceed several billion dollars over the next several years.
Revenues from Developing Offerings are primarily generated from online restaurant ordering and delivery services in Korea and retail operations in Taiwan. Farfetch Acquisition In January 2024 we completed the Farfetch Acquisition which will be consolidated in our results beginning in Q1 2024.
Revenues from Developing Offerings are primarily generated from our global luxury fashion marketplace, online restaurant ordering and delivery services in Korea and retail operations in Taiwan.
If changes in market conditions result in reductions to the estimated net realizable value of our inventory, we would increase our valuation in the period in which we made such a determination. Income Taxes We record a provision for income taxes for the anticipated tax consequences of our reported results of operations using the asset and liability method.
Income Taxes We record a provision for income taxes for the anticipated tax consequences of our reported results of operations using the asset and liability method.
The following table presents our total net revenues by segment. % Change (in millions) 2023 2022 As Reported Constant Currency Product Commerce $ 23,594 $ 19,955 18 % 19 % Developing Offerings 789 628 26 % 27 % Total net revenues $ 24,383 $ 20,583 18 % 20 % The increase in Product Commerce net revenues are primarily due to continued growth in our Active Customers and total net revenues per Active Customer, driven by increased product selection of our owned inventory, increased customer engagement across more product categories, and increased merchants available on our marketplace.
The following table presents our total net revenues by segment. % Change (in millions) 2024 2023 As Reported Constant Currency Product Commerce $ 26,699 $ 23,594 13 % 18 % Developing Offerings 3,569 789 352 % 363 % Total net revenues $ 30,268 $ 24,383 24 % 29 % The increase in Product Commerce net revenues is primarily due to higher net revenues per Product Commerce Active Customer in the second and third quarters of 2024, combined with continued growth in Product Commerce Active Customers, increasing 10% year-over-year.
The amount of the deferred revenue related to these loyalty rewards is not material. % Change (in millions) 2023 2022 As Reported Constant Currency Net retail sales $ 21,223 $ 18,338 16 % 17 % Net other revenue 3,160 2,245 41 % 42 % Total net revenues $ 24,383 $ 20,583 18 % 20 % Net retail sales represent the majority of our total net revenues which we earn from online product sales of our owned inventory to customers.
Coupang, Inc. 2024 Form 10-K 47 Table of Contents % Change (in millions) 2024 2023 As Reported Constant Currency Net retail sales $ 23,866 $ 21,223 12 % 17 % Net other revenue 6,402 3,160 103 % 110 % Total net revenues $ 30,268 $ 24,383 24 % 29 % Net retail sales represent the majority of our total net revenues which we earn from online product sales of our owned inventory to customers.
The increased loss in Developing Offerings segment adjusted EBITDA was the result of increased investments in our Eats and Taiwan offerings, and higher content costs for our Coupang Play offering. These losses were partially offset by efficiencies in delivery costs associated with Coupang Eats.
Developing Offerings The increased loss for the year ended December 31, 2024 in Developing Offerings adjusted EBITDA was the result of increased investments in Taiwan offerings, higher content costs for our Coupang Play offering, and the $34 million of adjusted EBITDA loss from Farfetch which was acquired in January 2024.
Coupang, Inc. 2023 Form 10-K 43 Table of Contents Key Financial and Operating Highlights: (in millions) 2023 2022 % Change Total net revenues $ 24,383 $ 20,583 18 % Total net revenues, constant currency (1) $ 24,637 $ 23,236 20 % Gross profit (2) $ 6,190 $ 4,710 31 % Net income (loss) $ 1,360 $ (92) NM (3) Net income (loss) margin 5.6 % (0.4) % Adjusted EBITDA (1) $ 1,074 $ 381 182 % Adjusted EBITDA margin (1) 4.4 % 1.9 % Net cash provided by operating activities $ 2,652 $ 565 NM (3) Free cash flow (1) $ 1,775 $ (246) NM (3) Segment adjusted EBITDA: Product Commerce $ 1,540 $ 606 154 % Developing Offerings $ (466) $ (225) 107 % (1) Total net revenues, constant currency; total net revenues growth, constant currency; adjusted EBITDA; adjusted EBITDA margin; and free cash flow are non-GAAP measures.
Key Financial and Operating Highlights: (in millions) 2024 (1) 2023 % Change Total net revenues $ 30,268 $ 24,383 24 % Total net revenues, constant currency (2) $ 31,552 $ 24,636 29 % Gross profit (3) $ 8,831 $ 6,190 43 % Net income (4) $ 66 $ 1,360 (95) % Net income margin 0.2 % 5.6 % Adjusted EBITDA (2) $ 1,375 $ 1,074 28 % Adjusted EBITDA margin (2) 4.5 % 4.4 % Net cash provided by operating activities $ 1,886 $ 2,652 (29) % Free cash flow (2) $ 1,016 $ 1,775 (43) % Segment adjusted EBITDA: Product Commerce $ 2,006 $ 1,540 30 % Developing Offerings $ (631) $ (466) 35 % (1) Includes results of operations of Farfetch from acquisition date, January 30, 2024.
As part of the Farfetch Acquisition, a subsidiary of the limited partnership assumed the then outstanding syndicated Term Loans of $633 million, inclusive of fees incurred, under Farfetch’s existing Credit Agreement with certain banks and financial institutions. The Term Loans are payable on October 20, 2027, early repayment permitted.
Coupang, Inc. 2024 Form 10-K 54 Table of Contents Farfetch Term Loans As part of the Farfetch Acquisition, our subsidiary assumed the then outstanding syndicated Term Loans (“Farfetch Term Loans”) under Farfetch’s existing credit agreement with certain banks and financial institutions (the "Lenders") of $575 million, inclusive of fees incurred and less $58 million we repurchased upon acquisition.
Additionally, certain of our Coupang, Inc. 2023 Form 10-K 48 Table of Contents foreign earnings may also be taxable in the United States.
Foreign jurisdictions have different statutory tax rates than those in the United States. Additionally, certain of our foreign earnings may also be taxable in the United States.
The tax position is measured at the largest amount of benefit that has a likelihood of greater than 50 percent of being realized upon ultimate settlement. Due to uncertainties in any tax audit outcome, our estimates of the ultimate settlement of our unrecognized tax positions may change and the actual tax benefits may differ significantly from our estimates.
The second step addresses measurement of a tax position that meets the more-likely-than-not criteria. The tax position is measured at the largest amount of benefit that has a likelihood of greater than 50 percent of being realized upon ultimate settlement.
This was partially offset by the net revenue impact of our transition of FLC merchants to new contracts now recognized on a net basis. The increase in Developing Offerings net revenues are primarily due to our growth initiatives in Taiwan.
Growth in total net revenues per Product Commerce Active Customers was driven by increased customer engagement within and across more product categories. This was partially offset by a 4% net revenue decline from our transition of FLC merchants to new contracts now recognized on a net basis and a 5% negative impact from foreign exchange.
We therefore view net revenues per Active Customer as a key indicator of engagement and retention of our customers and our ability to drive future revenue growth. Coupang, Inc. 2023 Form 10-K 44 Table of Contents Non-GAAP Financial Measures We report our financial results in accordance with U.S. GAAP.
We therefore view net revenues per Product Commerce Active Customer as a key indicator of engagement and retention of our customers and our ability to drive future revenue growth, though there may be a short-term dilutive impact when a large number of new Product Commerce active customers are added in a recent period.
We expect that our effective tax rate in future periods will continue to differ significantly from the applicable statutory rate. During 2023, we continued to see improved and sustained profitability, which presents objective positive evidence for the realizability of certain deferred tax assets.
Pre-tax losses from Farfetch, for which we recognized no income tax benefit due to the related valuation allowances, increased the effective income tax rate by 36.9%. We expect that our effective tax rate in future periods will continue to differ significantly from the applicable statutory rate.
The increase in operating, general and administrative expenses primarily reflects increases in fulfillment costs due to growth in our business and slightly higher advertising expenses, reflecting growth in revenues.
The increase in operating, general and administrative expenses primarily reflects increases in technology and infrastructure costs to support our continued growth. Additionally, the acquisition of Farfetch increased operating costs by $941 million. The increase also includes the impact of the KFTC administrative fine of $121 million.
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Page Overview 43 Key Business Metrics 44 Non-GAAP Financial Measures 45 Results of Operations 47 Liquidity and Capital Resources 49 Critical Accounting Policies and Estimates 52 Recently Adopted Accounting Pronouncements 54 Overview Coupang is one of the largest retailers in Asia, with a mission to revolutionize the everyday lives of its customers and create a world where people wonder, “How did we ever live without Coupang?” Coupang is headquartered in the United States, with operations and support services performed in geographies including South Korea, Taiwan, Singapore, China, and India.
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Page Overview 45 Key Business Metrics 46 Results of Operations 47 Non-GAAP Financial Measures 51 Liquidity and Capital Resources 53 Critical Accounting Policies and Estimates 55 Recently Adopted Accounting Pronouncements 57 Overview Coupang is a technology and Fortune 200 company listed on the New York Stock Exchange (NYSE: CPNG) that provides retail, restaurant delivery, video streaming, and fintech services to customers around the world under brands that include Coupang, Coupang Eats, Coupang Play and Farfetch.
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We believe the true measure of our success will be shareholder value created over the long term. Our long-term investments in building a differentiated technology-orchestrated network and customer-facing functionality have helped build a business that we expect will deliver significant growth and cash flows at scale.
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Headquartered in the United States, Coupang has operations and support services in geographies including South Korea, Taiwan, Singapore, China, India and Europe.
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We have in turn successfully reinvested to expand existing offerings and develop new offerings, such as with our owned-inventory and marketplace selection, FLC merchant services, Rocket WOW membership, Rocket Fresh, Coupang Eats, and Coupang Play, among others in Korea. Our segments reflect the way we evaluate our business performance and manage operations.
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Farfetch Acquisition In January 2024 we acquired the business and assets of Farfetch Holdings plc (“Farfetch”), a leading global marketplace for the luxury fashion industry. See Note 16 — "Business Combinations - Farfetch" to the consolidated financial statements included elsewhere in Part II, Item 8 of this Annual Report on Form 10-K.
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Farfetch has a history of operating losses, and to what extent their future results may impact our consolidated results is unknown.
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During 2024, we have undertaken restructuring actions to reduce headcount, exit leases and licensing agreements. In February 2025, we entered into a settlement agreement and mutual release with Authentic Brands Group LLC related to a license agreement.
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This will continue to result in a prospective reduction in total net revenues associated with FLC compared to historical periods, with no significant corresponding impact on gross profit expected.
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Fulfillment Center Fire In June 2021, a fire extensively damaged our Deokpyeong fulfillment center (“FC Fire”) resulting in a loss of the inventory, building, equipment, and other assets at the site.
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These expenses as a percentage of revenue were unchanged at 23.4% for 2022 and 2023 as continued operating efficiencies were offset by decreased revenues from the transition to the new FLC contracts beginning in the second quarter of 2023. Interest Income Interest income primarily consists of interest earned on our deposits held with financial institutions.
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We are insured on property losses from the FC Fire, and while the insurer continues assessment of the total potential loss coverage on the claim, during the fourth quarter of 2024 we agreed to a settlement on a portion of the claim and now deem the recovery of insurance proceeds under the policy as probable.
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Interest income increased $125 million compared to the prior year. The increase in interest income was primarily due to higher interest rates in 2023 combined with our higher average cash and cash equivalent balances.
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We recognized an insurance gain of $175 million in the fourth quarter of 2024, which included $116 million for the inventory loss included in “Cost of sales” and $59 million for property and equipment losses, included in “Operating, general and administrative”.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeOur borrowings generally include lines of credit with financial institutions, some of which carry variable interest rates. As of December 31, 2023, we had no balances outstanding under our lines of credit. An assumed hypothetical 10% change in prevailing interest rates would not have a material impact on our results of operations.
Biggest changeAs of December 31, 2024, we had $493 million outstanding on the Farfetch Term Loans, $151 million outstanding on the Taiwan Revolving Credit Facility, and no balance outstanding on the Revolving Credit Facility. An assumed hypothetical 10% change in prevailing interest rates would not have a material impact on our results of operations.
Any future borrowings incurred under the Revolving Credit Facility and Revolving Credit Agreement would accrue interest at rates subject to current market conditions. Foreign Currency Risk We have accounts on our foreign subsidiaries’ ledgers, which are maintained in the respective subsidiary’s local currency and translated into USD for reporting of our consolidated financial statements.
Any future borrowings incurred under the Revolving Credit Facility would accrue interest at rates subject to current market conditions. Foreign Currency Risk We have accounts on our foreign subsidiaries’ ledgers, which are maintained in the respective subsidiary’s local currency and translated into USD for reporting of our consolidated financial statements.
Increases or decreases in the value of the USD affect the value of these items with respect to the non-USD-denominated businesses in the consolidated financial statements, even if their value has not changed in their original currency.
Increases or decreases in the value of the USD affect the value of these items with respect to the non-USD-denominated businesses on the consolidated financial statements, even if their value has not changed in their original currency.
We do not enter into investments for trading or speculative purposes and have not used any derivative financial instruments to manage our interest rate risk exposure. Our interest rate risk arises primarily from some of our variable rate debt as well as our undrawn Revolving Credit Agreement. Borrowings issued at variable rates expose us to variability in cash flows.
We do not enter into investments for trading or speculative purposes and have not used any derivative financial instruments to manage our interest rate risk exposure. Our interest rate risk arises primarily from some of our variable rate debt as well as our undrawn revolving credit agreements. Borrowings issued at variable rates expose us to variability in cash flows.
The degree of credit risk will vary based on many factors, including the duration of the transaction and the contractual terms of the agreement. As appropriate, management evaluates and approves credit standards and oversees the credit risk management function related to investments. Coupang, Inc. 2023 Form 10-K 55 Table of Contents
The degree of credit risk will vary based on many factors, including the duration of the transaction and the contractual terms of the agreement. As appropriate, management evaluates and approves credit standards and oversees the credit risk management function related to investments. Coupang, Inc. 2024 Form 10-K 58 Table of Contents
Our market risk exposure is primarily the result of fluctuations in interest rates, foreign currency, and credit. Interest Rate Risk As of December 31, 2023, we had cash, cash equivalents and restricted cash of $5.6 billion. Interest-earning instruments carry a degree of interest rate risk.
Our market risk exposure is primarily the result of fluctuations in interest rates, foreign currency, and credit. Interest Rate Risk As of December 31, 2024, we had cash, cash equivalents and restricted cash of $6.0 billion. Interest-earning instruments carry a degree of interest rate risk.
An assumed hypothetical 10% adverse change in average exchange rates used to translate foreign currencies to USD would have resulted in a decline in total net revenues of $2.2 billion and a decrease in net income of $175 million for 2023.
An assumed hypothetical 10% adverse change in average exchange rates used to translate foreign currencies to USD would have resulted in a decline in total net revenues of $2.5 billion and a decrease in net income of $137 million for 2024.
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Our borrowings generally include lines of credit with financial institutions, some of which carry variable interest rates, and the Farfetch Term Loans which carries a variable interest rate.

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