Coupang posted a first-half operating loss of more than 1 trillion won after reflecting a penalty for a personal data leak in its second-quarter results.

Coupang Inc said on Tuesday it recorded second-quarter revenue of 13.3 trillion won and an operating loss of 835 billion won. It swung to a loss from an operating profit of 209.3 billion won a year earlier. Net loss was 856 billion won, and net loss per share was $0.32.

Coupang Inc filed a consolidated second-quarter earnings report containing the figures with the U.S. Securities and Exchange Commission on Tuesday. Second-quarter revenue was $8.86 billion. That was up 4 percent from $8.52 billion a year earlier. Applying an average quarterly won-dollar exchange rate of 1,501.89 won, that equals 13.3 trillion won. Revenue in the second quarter of last year was 12.0 trillion won, and the constant-currency growth rate excluding exchange-rate changes was 10 percent. That is higher than the 8 percent growth rate in the first quarter.

The direct cause of the swing into the red was the penalty. Coupang Inc reflected about $410 million of penalties as expenses in second-quarter operating, general and administrative expenses (OG&A).

The Personal Information Protection Commission said in June it would impose a penalty of 624.7 billion won and a fine of 16.8 million won over the data leak incident.

Gaurav Anand (거랍 아난드), Coupang's chief financial officer, said on a conference call, "This penalty must go through judicial judgment and we plan to challenge it through the courts, but we reflected the cost in OG&A this quarter."

Excluding the penalty, second-quarter operating loss and net loss were $146 million (about 219.2 billion won) and $160 million (240.3 billion won), respectively, the company said. The losses continued from the first quarter. It marked a second straight quarterly loss after a first-quarter operating loss of 354.5 billion won and a net loss of 389.7 billion won.

As a result, the cumulative first-half operating loss was $798 million (about 1.19 trillion won), and the net loss was $836 million (1.25 trillion won). It is the first time since its New York stock market listing in 2021 that the first-half deficit has exceeded 1 trillion won, and the largest amount on record.

The previous record was the first half of 2021, when the operating loss was $782.2 million (about 875.0 billion won) and the net loss was $797.0 million (910.0 billion won) at the exchange rate at the time. On a quarterly basis, this quarter also exceeded the operating loss of $514.9 million (about 577.3 billion won) in the second quarter of 2021.

Profits built up over the past 2 years disappeared in half a year. The first-half operating loss was close to the combined operating profit of 1.28 trillion won for 2024 to 2025, and the first-half net loss was more than three times the combined net profit of 397.0 billion won over the same period.

Cost structure weighed on results. Second-quarter OG&A was $3.05 billion, up 26 percent, and total operating costs were $9.41 billion, exceeding revenue. Adjusted EBITDA fell 62 percent to $163 million.

Revenue from Product Commerce (Rocket Delivery, Rocket Fresh, Rocket Growth and Marketplace) was 11.2 trillion won, growing 8 percent on a constant-currency basis. Adjusted EBITDA for the segment fell 42 percent to 573.7 billion won.

Active customers were 24.7 million, exceeding both a year earlier and 23.9 million in the previous quarter. Revenue per customer was 452,060 won, up 5 percent on a constant-currency basis.

Bom Kim (김범석), chairman of Coupang Inc, said, "Most of our customers' spending remains unchanged and their spending is at an all-time high," adding, "Customers whose spending declined are a portion of the total, and most customers have returned."

Kim pointed to logistics processing capacity as the backdrop to margin pressure. He said, "We could cut costs, but we decided not to, because the right long-term decision is to gradually expand logistics processing capacity to support our 'North Star' (top priority) of customer experience."

Revenue from growth businesses such as Taiwan Rocket Delivery, Farfetch and Coupang Eats was 2.15 trillion won, growing 24 percent on a constant-currency basis. The growth businesses adjusted EBITDA loss was 328.9 billion won, narrowing 7 percent from $235 million in the second quarter of last year.

Coupang Inc started dawn delivery in Taiwan. Kim said, "It took 4 years since we began our logistics journey to launch dawn delivery in Korea, but Taiwan achieved it in just 1 year."

Cash generation also weakened. Cumulative operating cash flow over the past 12 months was $1.4 billion, down $484 million, and free cash flow was $105 million, down $679 million.

Anand gave a constant-currency consolidated third-quarter revenue growth rate forecast of 8 to 9 percent. He cited differences in the timing of the Chuseok holiday in South Korea as negatively affecting comparisons with a year earlier.

The company expects consolidated adjusted EBITDA margin in the third quarter to shrink by 3 to 4 percentage points from a year earlier. Anand said, "As the improvement becomes increasingly clear, we expect Product Commerce adjusted EBITDA margin to approach pre-data incident levels by mid-2027."

Coupang Inc repurchased 23.2 million shares of Class A common stock for $459 million during the second quarter. It was part of a $1.0 billion share buyback program approved at its first-quarter earnings release.