Coupang, Inc.

Hello, everyone. My name is Krista, and I will be your conference operator today. At this time, I would like to welcome everyone to the Coupon 2024 First 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. 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 Coupang's first quarter 2024 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 statements. Actual 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, our slides accompanying this webcast, and our SEC filings, which are posted on the company's investor relations website. And now, I'll turn the call over to Baum.

Thanks, everyone, for joining us today. Before we dive in, here are five takeaways from a strong start to 2024. First, we continue to deliver results because we focus on what matters most, customer experience and operational excellence. Second, we're still single-digit share of a massive retail opportunity in Korea and an even smaller share of Taiwan's. Third, newer services like Rocket Fresh and Fulfillment and Logistics by Coupang, or FLC, are gaining momentum. Offerings like these enable us to expand selection on Rocket exponentially for customers and provide critical support to suppliers, particularly small and medium enterprises, or SMEs, by giving them access to our Rocket infrastructure and network. Fourth, our developing offerings are making significant strides, meeting our milestones, and in many cases, performing ahead of plan. Finally, we continue to invest in infrastructure and WOW benefits to raise the bar again and again for what customers should expect as their standard experience. We'll be relentless in our pursuit of new moments of WOW for customers across selection, price, and service. Now, some numbers to highlight our performance at the start of the year. In Q1, our revenues increased 28% year over year in constant currency, or 23% excluding Farfetch, which we began consolidating at the end of January. And adjusting for the FLC accounting change we made beginning in Q2 of last year, these Q1 revenue growth rates would have been over 10 percentage points higher That robust growth was primarily driven by the increase in spend of all of our existing customer cohorts, even our oldest. Our product commerce active customers also grew 16% year over year. Newer customers naturally spend less, but their spend levels have followed the same trajectory of older customers over time. While new active customers were not the primary driver of this past quarter's revenue growth, the rising number of new active customers should contribute more to growth for the business in the years ahead. The growth of our fresh offering was also notable this past quarter, growing 70% year-over-year in units sold. Customers are attracted to what we believe is the widest assortment of fresh goods in the market, low prices, high quality, and a free shipping threshold of just $11. This is the best free shipping program for online grocery that we know of in the world. And to top it off, we guarantee that your order placed by midnight will be in front of your door before 7 a.m. in the morning. We're also proud that Fresh provided critical support to farmers and fishers by increasing the inventory we purchase directly from them, while also delivering significant savings in both time and money to customers. We continue to see impressive growth in FLC, which recorded a 130% increase in units sold year over year. As a result, the assortment available to customers with the convenience of overnight, same-day, or next-day delivery is expanding with each passing day. And FLC is providing critical support to thousands of merchants who are able to grow faster by selling their products with rocket service levels without investing in prohibitively expensive infrastructure and technology. FLC sellers, over 80% of whom are SMEs, have seen their sales on average more than double within 90 days of converting to FLC. And on developing offerings, we've been pleased with our execution and progress. We've consolidated Farfetch into our developing offerings starting this quarter. Our journey at Farfetch is just beginning, and the team is focused on generating close to positive adjusted EBITDA on a run rate basis by the end of the calendar year. On Eats, customer adoption is accelerating. In the month of March, when Eats launched its free delivery program, Eats recorded the largest year-over-year increase in customers and orders in its history. We continue to make progress in Taiwan, where we're working to break meaningful trade-offs for customers. We're also providing access to wide Korean selection and helping over 21,000 Korean suppliers export their products to the Taiwan market over the last year. It's early days in Taiwan, but we're as excited as ever about its potential. While we're further along in Korea, it's important to note that we're still just single-digit share of a massive and highly fragmented $560 billion commerce opportunity. New China commerce entrants remind us that barriers to entry are low and consumers can switch shopping options faster in retail than in almost any other industry within seconds and with a swipe of the finger. customers cast a new vote with every purchase they make and will not hesitate to spend their money at another venue they deem to be better we have to win their vote each and every time by offering them the best selection price and service and we strive relentlessly to make that value proposition better every day To that end, we plan to continue investing billions of dollars in capex over the next several years to strengthen our fulfillment and logistics infrastructure. We aim to increase the speed of delivery across the market and make free delivery available to even the most remote corners of Korea, including secluded islands and mountain settlements that currently do not have access to our fastest delivery options. That investment in infrastructure will help Korean manufacturers and SMEs get even better service levels for their products on Rocket. We're also deepening our commitment to Korean manufacturing. We plan to increase the amount of goods that we purchase and sell that are manufactured in Korea from $13 billion in 2023 to over $16 billion in 2024. Last year, we provided over $3 billion in WOW membership benefits, including free delivery and return services and WOW exclusive discounts. This year, we expect to expand those membership benefits even further, providing over $4 billion in WOW-related benefits for customers in 2024. This includes free access to exciting sporting events we've created, like the MLB season opening games we hosted between the Dodgers and Padres in Korea in March, as well as the world-class European football matches we bring live to fans in Korea each summer. We also recently began providing unlimited free delivery on Eats for WOW members across Korea to eliminate one of the biggest recurring costs for consumers in food delivery. 2024 will be an important year to strengthen our experience for customers and to expand programs that provide vital support to our manufacturing and SME partners. We remain as energized as ever to transform the lives of every customer and stakeholder we touch, to create a world where everyone wonders, how did I ever live without Coupang? Now, I'll turn the call over to Gaurav to review our results in more detail.