Coupang (CPNG) delivered Q3 2021 results characterized by revenue and gross profit growth as earnings missed consensus estimates. Additionally, advertising revenue and active customers grew robustly, affirming underlying growth. CPNG shares fell 8.9% to close at $26.58 on November 12.
Coupang is an e-commerce company with a mission to revolutionize the everyday lives of its customers. The company sells apparel, electronics, footwear, furniture, and nutritional supplements, among other products. (See Analysts’ Top Stocks on TipRanks)
Total revenue in Q3 grew 48% year-over-year to $4.6 billion. On a constant currency basis, revenue grew twice as fast as the 20% growth rate of the overall Korean e-commerce segment. In addition, Coupang registered its 15th straight quarter of at least 20% year-over-year active customer growth.
Gross profit in the quarter increased 62% year-over-year to $754.52 million, but net loss widened to $323.98 million compared to $172.99 million delivered the same quarter last year. Coupang posted a Q3 net loss per share of $0.19, narrower than a loss of $5.91 delivered the same quarter last year. However, it missed consensus estimates of a loss of $0.17 a share.
During the quarter, active customers purchasing across six or more categories on Coupang doubled from two years ago, as spending grew by at least 25% year-over-year. Coupang invested $95 million in incremental labor and operational cost related to the COVID-19 cases.
In early November, Goldman Sachs analyst Eric Cha reiterated a Buy rating on the stock and lowered its price target to $52 from $61, implying 95.6% upside potential to current levels.
Consensus among analysts is a Moderate Buy based on one Buy and two Holds. The average Coupang price target of $32 implies 20.4% upside potential to current levels.