Coupang, Inc.

Hello, my name is Krista, and I will be your conference operator today. At this time, I would like to welcome everyone to the Coupang 2023 Third Quarter Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star, followed by the number five on your telephone keypad. If you would like to withdraw your question, press star and the number five once again. Thank you. Now, I'd like to turn the call over to Mike Parker, Vice President of Investor Relations. You may begin your conference.

Thanks, operator. Welcome, everyone, to Coupon's third quarter 2023 earnings conference call. I'm pleased to be joined on the call today by our founder and CEO, Bom Kim, and our CFO, Gaurav Anand. The following discussion, including responses to your questions, reflects management's views as of today's date only. We do not undertake any obligation to update or revise this information, except as required by law. Certain statements made on today's call include forward-looking results may differ materially. Additional information about factors that could potentially impact our financial results is included in today's press release and in our filings with the SEC, including our most recent annual report on Form 10-K and subsequent filings. During today's call, we may present both GAAP and non-GAAP financial measures. Additional disclosures regarding these non-GAAP measures, including reconciliations of these measures to the most comparable GAAP measures, are included in our earnings release, slides accompanying this webcast, and our SEC filings, which are posted on the company's investor relations website. Any comparative comments we make will be on a year-over-year basis unless we state otherwise. And now, I'll turn the call over to Baum.

Thanks, everyone, for joining us today. Before I turn it over to Gaurav to go through our financials in detail, I'd like to share with you four key takeaways from our third quarter results. First, we continue to deliver durable growth and expanding profitability, not one at the expense of the other, because of our years of unparalleled investment and an unrelenting focus on both the customer experience and operational excellence. Second, our flywheel is accelerating. Our selection advantage is a critical component of that accelerating flywheel. In Q3, we expanded selection across both first and third party. Both active customer and revenue grew even faster than last quarter. Active customers grew 14% year over year, faster than the rate of any quarter since the pandemic levels of 2021. We've observed that increasing selection on Rocket leads generally to increasing customer spend on Coupang. In Q3, even established categories like consumables experienced double-digit year-over-year growth that was a high multiple of the rate of the market. Newer categories like Fresh grew more than twice as fast as the overall business and also at a high multiple of the market growth rate. We're also seeing strong third-party volume growth, which is outpacing the rest of the business. That is in part due to fulfillment and logistics by coupon, or FLC, growing more than three times faster than the overall business. FLC is also expanding on rocket delivery selection in categories like fashion, where historically first-party inventory has been slower to grow. We believe we still have significant opportunity ahead in both number of active customers and spend per customer. Our active customer count is just 20 million, and our single-digit share of the total retail market indicates a low share of wallet today. We believe the continued expansion of selection on Rocket via our first-party offering and FLC will help drive a higher share of both active customers and total retail spend. Third, WOW membership is amplifying all the benefits of our ecosystem. When WOW members increase their engagement around one benefit, it can increase their engagement across all of Groupon's offerings. Our WOW savings program in Eats is a perfect example. Since we launched the Eats WOW membership savings program in early Q2, we've seen a surge of customer and order growth. While members participating in EATS have increased 90% since launch, and transaction volume has more than doubled in over 75% of the regions where we've launched the program. We expect EATS to be at approximately 20% market segment share by the end of the year, nearly twice the level it was at the launch of the program. And setting aside one-time investments such as new merchant acquisition costs, EATS is unit economics positive. This is a permanent program for a while membership and with roughly only 20% of while members purchasing eats into three we see vast opportunity for growth ahead. But the impact of this program extends beyond each engagement on eat helps drive higher levels of Member acquisition and retention on while membership as we've noted before. WOW members purchase with significantly higher frequency and across more categories and offerings than non-WOW members. WOW members who purchase Eats spend considerably more on product commerce. And in the regions where we've launched the program, we've observed that they spend twice as much overall as WOW members who don't purchase Eats. Fundamentally, Coupang is not a consumer goods company or a delivery company or a retail company. Hupeng is, at its essence, a company that breaks trade-offs to deliver wow in customers' daily lives. Wow membership is at the heart of that broader mission, and we're determined to make wow the best value on the planet for customers. Finally, our conviction about the long-term potential in Taiwan continues to strengthen. We launched rocket delivery in Taiwan in October of 2022, and the offering in Taiwan has scaled much faster in its first year of operation than it did in its first year in Korea. And our app is on pace to be the most downloaded app in the market for all of 2023. We're off to a promising start. Our growth in Taiwan is also opening doors of opportunity for our merchants and suppliers in Korea. Small and medium enterprises, for example, have historically had challenges reaching customers outside of their domestic market. In just one year, we've helped over 12,000 SMEs export their products to Taiwan. It's a reminder that the trade-offs we break have the potential to benefit all in the value chain by generating moments of wow for customers, opportunities for suppliers and merchants, and value for our shareholders. And now, I'll turn the call over to Gaurav.