Coupang Inc (CPNG) 2023 Q2 法說會逐字稿

Hello. My name is Christa, and I will be your conference operator today. At this time, I would like to welcome everyone to Coupang 2023 Second Quarter Earnings Conference Call. (Operator Instructions).

大家好。我叫克里斯塔，今天我將擔任你們的會議主持人。現在，我歡迎大家參加Coupang 2023年第二季業績電話會議。 （接線生指示）

Now I'd like to turn the call over to Mike Parker, Vice President of Investor Relations. You may begin your conference.

現在我想把電話轉給投資人關係副總裁麥克帕克。您可以開始會議了。

Welcome, everyone, to Coupang's Second 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.

歡迎大家參加Coupang 2023年第二季財報電話會議。我很高興今天能與我們的創辦人兼執行長Bom Kim和財務長Gaurav Anand一起參加電話會議。

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.

以下討論（包括對您問題的回應）僅反映截至今日管理層的觀點。除法律要求外，我們不承擔更新或修改此資訊的任何義務。今天電話會議上的某些陳述包含前瞻性陳述。實際結果可能存在重大差異。有關可能影響我們財務業績的因素的更多信息，請參閱今天的新聞稿以及我們向美國證券交易委員會 (SEC) 提交的文件，包括我們最新的 10-K 表格年度報告及後續文件。

During today's call, we may present both GAAP and non-GAAP financial measures. Additional disclosures regarding those non-GAAP measures, including reconciliations of these measures to the most comparable GAAP measures are included in our earnings release provided accompanying this webcast and our SEC filings, which are posted on the company's Investor Relations website.

在今天的電話會議上，我們可能會同時揭露 GAAP 和非 GAAP 財務指標。有關這些非 GAAP 指標的更多揭露，包括這些指標與最具可比性的 GAAP 指標的調整表，已包含在本次網路直播隨附的收益公告以及我們提交給美國證券交易委員會 (SEC) 的文件中，這些文件已發佈在公司的投資者關係網站上。

And now I'll turn the call over to Bom.

現在我將把電話轉給 Bom。

Thanks, everyone, for joining us today. Before Gaurav goes over our financial results in greater detail, I'd like to take a moment to frame our Q2 results under 5 key takeaways. First, we continue to deliver expanding profitability and sustained high growth, 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, both revenue and active customers increased at a faster pace this quarter. It's worth highlighting that the growth of active customers accelerated from 1% year-over-year in Q4 of last year to 5% in Q1 to 10% this quarter. Additionally, all of our customer courts, even our oldest continue to increase their spend and the number of categories they are purchasing on Coupang.

感謝各位今天加入我們。在Gaurav詳細介紹我們的財務表現之前，我想先花點時間總結一下我們第二季業績的五個關鍵點。首先，我們持續保持獲利能力的提升和持續的高成長，這得益於我們多年來無與倫比的投入以及對客戶體驗和卓越營運的不懈關注。其次，我們的飛輪正在加速運轉，本季營收和活躍客戶數量均實現了更快的成長。值得一提的是，活躍客戶數量的成長速度從去年第四季的年增1%加速到第一季的5%，再到本季的10%。此外，我們所有的客戶，即使是最老的客戶，都在持續增加在Coupang上的消費和購買品類數量。

All of these trends underscore how differentiated our value proposition is in a retail market that we believe is defined by high prices and limited selection. They're also a reflection of our early stage of growth. We have just single digit share today of a massive retail market expected to reach $550 billion in the next 3 years. It's hard to overstate just how early we are on this journey. Third, we reached another significant milestone this quarter, delivering in the trailing 12 months, $2 billion of operating cash flow and over $1 billion of free cash flow.

所有這些趨勢都凸顯了我們在以高價位和有限選擇為特徵的零售市場中的價值主張是多麼的差異化。這也反映了我們尚處於成長初期。目前，我們在這個龐大的零售市場中僅佔有個位數的份額，而這個市場預計將在未來三年內達到5,500億美元。我們正處於這段旅程的早期階段，這一點毋庸置疑。第三，我們在本季實現了另一個重要的里程碑，在過去12個月中，我們的營運現金流達到20億美元，自由現金流超過10億美元。

We also delivered our fourth consecutive quarter of significant GAAP profitability with $145 million of net income in Q2. In addition, our free cash flow has converged with adjusted EBITDA as promised. We're more confident than ever that we will deliver on our long-term guidance of higher than 10% adjusted EBITDA. Fourth, we are seeing powerful momentum in our growth initiatives. We're less than a decade old as a retailer and only a few years into newer categories like fashion and beauty.

我們也實現了連續第四季度顯著的GAAP獲利，第二季淨利達1.45億美元。此外，我們的自由現金流已如承諾的那樣與調整後EBITDA持平。我們比以往任何時候都更有信心，能夠實現調整後EBITDA高於10%的長期目標。第四，我們的成長計畫勢頭強勁。作為一家零售商，我們成立還不到十年，進入時尚和美妝等新興領域也才幾年。

Accordingly, all of our categories on Rocket are still growing at a fast rate, and newer categories like fashion and beauty are growing significantly faster than our overall business. And high growth isn't limited to our first-party offering. Third-party sales in virtually every category, including fashion and beauty, are growing at a multiple of the retail market and our emerging merchant services like advertising and fulfillment and logistics by Coupang or FLC are growing more than twice as fast as our overall business.

因此，Rocket 上的所有品類仍在快速成長，時尚和美妝等新興品類的成長速度遠超我們的整體業務。而且，高成長並不僅限於我們的自營產品。幾乎所有品類（包括時尚和美妝）的第三方銷售額都以零售市場的數倍增長，而我們新興的商家服務，例如 Coupang 或 FLC 提供的廣告、訂單履行和物流，其增長速度更是整體業務的兩倍多。

Finally, we're also seeing exciting potential and progress in developing offerings, particularly in Eats and in Taiwan. In these, we spent several quarters achieving positive unit economics and improving almost every customer experience metric. We've reinvested our positive contribution margin back in the form of a discount of up to 10% for WOW members on unlimited orders. In the regions where we've launched our Eats benefit, we've already seen an 80% increase in total while members participating in Eats and a 20% increase in average WOW members spend on Eats. This has helped drive over 500 basis points of segment share gain in those regions.

最後，我們也看到了產品開發方面令人興奮的潛力和進展，尤其是在 Eats 和台灣地區。在這些地區，我們花了幾個季度實現了正向單位經濟效益，並提升了幾乎所有客戶體驗指標。我們已將正向貢獻利潤率以 WOW 會員無限量訂單最高 10% 的折扣形式進行再投資。在我們推出 Eats 優惠的地區，參與 Eats 的會員總數已增加 80%，WOW 會員在 Eats 上的平均消費成長了 20%。這有助於推動這些地區的分部份額成長超過 500 個基點。

Moreover, we've been delighted by the value it is generating across our ecosystem. Customers who purchased Eats have significantly higher spend in e-commerce and high retention on WOW membership. Eats has the potential to accelerate the flywheel for business as a whole. In light of the success of this strategy, we've made our unlimited Eat discount, a permanent feature of our WOW membership program. And with the majority of WOW members still yet to place an order on Eats, we believe the lion's share of growth is ahead of us. Taiwan is another investment that is thus far exceeding our expectations.

此外，我們對它在整個生態系統中創造的價值感到欣喜。購買 Eats 的客戶在電商領域的支出顯著增加，WOW 會員的留存率也更高。 Eats 有潛力加速整個業務的飛輪效應。鑑於此策略的成功，我們將 Eat 無限折扣作為 WOW 會員計劃的永久功能。由於大多數 WOW 會員尚未在 Eats 上下單，我們相信最大的成長空間就在我們眼前。台灣是另一項迄今為止遠遠超出我們預期的投資。

We have always believed that the transformational commerce experience we've enabled in Korea could delight customers around the world. We're seeing this play out in Taiwan. In Q2, Coupang was the most downloaded app in Taiwan. And in the 10 months since we launched Rocket Delivery, Taiwan has scaled faster than Rocket Delivery in Korea did in its first 10 months post-launch. Our bar for new initiatives is high. We've exited investments that didn't meet our internal threshold and defer countless others that rank below our most attractive opportunities.

我們始終堅信，我們在韓國打造的變革性商業體驗能讓全球客戶感到滿意。我們也見證了這一點在台灣的體現。第二季度，Coupang 是台灣下載量最高的應用程式。自 Rocket Delivery 上線以來的 10 個月裡，台灣的擴張速度甚至超過了 Rocket Delivery 在韓國上線後的前 10 個月。我們對新項目的門檻很高。我們已退出了未達到內部門門檻的投資，並推遲了無數排名低於我們最具吸引力的投資機會。

So far, Taiwan is leaping over that bar. In view of that progress, we will invest at a higher level in Taiwan this year. As always, we'll remain disciplined capital allocators investing more only if the underlying metrics continue to validate our conviction. Our updated estimate of investment in developing offerings, including Taiwan, Play and Eat will be around $400 million in 2023. We expect our investment in developing offerings to remain generally at these levels. And in every case, we remain committed to generating meaningful free cash flow at the consolidated level. In summary, we're excited about the momentum we've built and the massive market opportunities we have before us. We continue to execute with unwavering focus on customer experience and operational excellence and allocate capital with rigor and discipline.

到目前為止，台灣正在跨越這一門檻。鑑於這項進展，我們今年將在台灣加大投資。一如既往，我們將保持嚴謹的資本配置，只有在基本指標繼續驗證我們的信念的情況下，我們才會增加投資。我們最新的投資預估顯示，2023年在開發包括台灣、玩樂和餐飲在內的服務方面的投資將達到約4億美元。我們預計，在開發服務方面的投資將基本保持在這個水準。無論何種情況，我們都致力於在合併層面創造有意義的自由現金流。總而言之，我們對已經建立的良好勢頭和擺在我們面前的巨大市場機會感到興奮。我們將繼續堅定不移地專注於客戶體驗和卓越運營，並以嚴謹和自律的方式配置資本。

With that, I'll turn the call over to Gaurav.

說完這些，我將把電話轉給 Gaurav。

Thanks, Bom. Our teams delivered another strong quarter of disciplined execution across our business. We had record revenue, profit and dataflow as we remain focused on customers and driving efficiencies and innovation throughout our operations. Our total net revenues accelerated this quarter, growing 16% year-over-year on a reported basis and 21% in constant currency. This growth was driven by our product commerce segment, which also saw revenue growth of 16% on a reported basis and 21% in constant currency. And again, this quarter, our 3P offering, including FLC, expanded faster than 1P, driven by growth in small and medium enterprises or SMEs.

謝謝，Bom。我們的團隊在本季再次展現強勁的執行力，各項業務執行力也十分出色。我們始終專注於客戶，並在整個營運過程中不斷提升效率和創新，實現了創紀錄的收入、利潤和數據流。本季度，我們的總淨收入加速成長，報告期間年增16%，以固定匯率計算成長21%。這一增長主要得益於我們的產品商務部門，該部門報告期內收入增長16%，按固定匯率計算增長21%。此外，本季度，受中小企業（SME）業務成長的推動，包括FLC在內的第三方服務成長速度快於第一方服務。

As we noted last quarter, starting in Q2, we implemented certain contract changes that resulted in accounting changes for FLC revenue, which has changed from a gross to a net -- our growth rate in Q2 would have been an estimated 300 bps higher than the 21% growth rate. That growth is a multiple of the overall retail market, which grew at 3.1% year-over-year. Active customer growth continues to accelerate, increasing 10% year-over-year to $19.7 million in Q2. We added 1.8 million active customers over the last year. The underlying strength of our business can be seen in our gross profit. This quarter, we generated a record $1.5 billion in gross profit, representing 32% growth year-over-year and 7% over the last quarter.

正如我們上個季度所指出的，從第二季度開始，我們實施了某些合約變更，導致 FLC 收入的會計核算發生了變化，從毛收入變為淨收入——我們第二季度的增長率預計比 21% 的增長率高出 300 個基點。這一成長是整個零售市場的數倍，後者年增 3.1%。活躍客戶成長持續加速，第二季年增 10%，達到 1,970 萬美元。我們去年增加了 180 萬活躍客戶。我們業務的潛在優勢可以從我們的毛利看出。本季度，我們的毛利創下了 15 億美元的紀錄，年增 32%，比上一季成長 7%。

Our gross profit margin was 26.1%, a 320 bps improvement year-over-year. This margin was positively impacted 100 bps by the FLC accounting change previously mentioned. We expect our efforts will continue driving further margin expansion in the future, though we may not see meaningful improvement every quarter. We expect this FLC accounting change will be fully reflected in our reporting by Q4 of this year as merchants fully transition to the new contracts.

我們的毛利率為26.1%，年增320個基點。前述FLC會計準則變更對毛利率產生了100個基點的正面影響。我們預計，未來我們的努力將繼續推動利潤率的進一步提升，儘管我們可能不會每個季度都看到顯著的改善。隨著商家全面過渡到新合同，我們預計FLC會計準則變更將在今年第四季全面反映在我們的報告中。

As this change has no impact on FMC's economics or to gross profit, we continue to see gross profit dollars as a more meaningful indicator of the underlying growth of our business going forward. Customers increasingly come to Coupang for our vast selection are matched delivery speed and low prices. Our next-day Rocket Delivery experience across millions of multi and FLC products has no comparison in the market. We continue to generate further improvements in our general and administrative spend driven by both operational efficiencies and fixed cost leverage.

由於此變更對FMC的經濟效益或毛利均無影響，我們仍將毛利視為衡量未來業務潛在成長的更有意義的指標。越來越多的顧客選擇Coupang，是因為我們豐富的商品選擇、匹配的配送速度和低廉的價格。我們為數百萬件多件商品和FLC商品提供的隔日送達服務在市場上無可比擬。在營運效率和固定成本槓桿的推動下，我們的一般及行政支出將繼續進一步改善。

G&A expense as a percentage of revenue in Q2 decreased 66 bps year-over-year, even as we continue to make targeted investments into growth opportunities. This quarter, we delivered a record net income of $145 million and earnings per share of $0.08. This includes $26 million of income tax expense with an effective tax rate of 15% and a year-to-date tax rate of 20%. We also generated $300 million in adjusted EBITDA in Q2 for a record consolidated adjusted EBITDA margin of 5.1%. This represents a 380 bps improvement year-over-year and 100 bps quarter-over-quarter with nearly $950 million in adjusted EBITDA generated over the trailing 12 months.

儘管我們繼續對成長機會進行有針對性的投資，但第二季度的一般及行政費用佔收入的百分比同比下降了66個基點。本季度，我們實現了創紀錄的1.45億美元淨利和0.08美元每股收益。其中包括2,600萬美元的所得稅支出，實際稅率為15%，年初至今的稅率為20%。我們也在第二季實現了3億美元的調整後EBITDA，合併調整後EBITDA利潤率創下5.1%的紀錄。這比去年同期提高了380個基點，比上一季提高了100個基點，過去12個月的調整後EBITDA接近9.5億美元。

Our core product commerce segment generated $408 million in adjusted EBITDA in Q2 with a margin of 7.2%. This is an improvement of nearly 520 bps year-over-year and 200 bps quarter-over-quarter. We are increasingly confident in our ability to achieve our entitlement adjusted EBITDA margins of over 10% with significant opportunities still in front of us to drive further margin expansion through supply chain optimization, operational efficiencies and scaling of newer offerings like ads. However, we don't expect the gains to be consistent each quarter.

我們核心產品商務部門在第二季實現了4.08億美元的調整後EBITDA，利潤率為7.2%。這比去年同期提高了近520個基點，比上一季提高了200個基點。我們越來越有信心實現10%以上的調整後EBITDA利潤率，同時我們仍然擁有巨大的機會，可以透過優化供應鏈、提高營運效率以及擴展廣告等新產品來進一步提升利潤率。然而，我們並不預期每季都能維持持續的成長。

The adjusted EBITDA loss for our developing offerings segment increased $207 million this quarter, a $76 million year-over-year increase. As Bom noted, we are pleased with the progress we are making across our developing offerings, and we are increasingly more confident about these opportunities, especially Eats, Taiwan and Play. We now expect our adjusted EBITDA losses for developing offerings to be around $400 million in 2023. We are encouraged by the momentum we are seeing in these offerings and their ability to compound value across our ecosystem and to accelerate the entire flywheel. We will continue to remain disciplined and abide by our operating tenants.

本季度，我們發展中產品部門的調整後EBITDA虧損增加了2.07億美元，年增7,600萬美元。正如Bom所指出的，我們對發展中產品部門的進展感到滿意，並且對這些機會，尤其是「吃」、「台灣」和「玩」的信心日益增強。我們目前預計，2023年發展中產品部門的調整後EBITDA虧損將達到約4億美元。這些產品部門的強勁發展勢頭，以及它們在我們生態系統中創造複合價值並加速整個飛輪運轉的能力，令我們備受鼓舞。我們將繼續保持紀律，並遵守我們營運租戶的規定。

We expect to always take the long view and prioritize our capital allocation to deliver the highest levels of long-term shareholder value. We have demonstrated this discipline in building our retail offering in Korea over the years. We have hit another significant milestone this quarter, generating $2 billion in operating cash flow and $1.1 billion in free cash flow on a trailing 12-month basis. And free cash flow has now converged with our adjusted EBITDA as we had guided.

我們期望始終著眼長遠，優先考慮資本配置，以實現最高的長期股東價值。多年來，我們在韓國建構零售業務的過程中，始終秉持著這項原則。本季度，我們又創下了一個重要的里程碑，過去12個月的營運現金流為20億美元，自由現金流為11億美元。目前，自由現金流已與調整後息稅折舊攤提前利潤（EBITDA）持平，符合我們的預期。

We believe the progress we have made thus far is sustainable and will continue. It has been driven by expansion in overall profitability as well as improvements in working capital management and disciplined CapEx spend. And we are generating this free cash flow while also continuing to invest into nascent TAM-building opportunities like Eats and international. While we are proud of the results we are reporting today, we are even more proud of the way in which our teams are relentlessly focused on waving our customers every day. We are excited to continue working to break trade-offs for customers and creating a world where customers wonder how did I ever live without Coupang. Operator, we are now ready to begin the Q&A.

我們相信，迄今為止的進展是可持續的，並將持續下去。這得益於整體獲利能力的提升、營運資本管理的改善以及嚴謹的資本支出。我們在創造自由現金流的同時，也持續投資於新興的TAM建設機會，例如外送和國際業務。我們為今天報告的業績感到自豪，但更讓我們感到自豪的是，我們的團隊每天都堅持不懈地專注於為客戶提供服務。我們很高興能夠繼續努力，打破客戶的取捨，創造一個讓客戶驚嘆沒有Coupang我該如何生活的世界。接線員，我們現在可以開始問答環節了。

(Operator Instructions) Your first question comes from the line of Stanley Yang of JPMorgan.

（操作員指示）您的第一個問題來自摩根大通的 Stanley Yang。

Thank you for the opportunity to ask the questions. And congratulate on great resort. I have 2 questions. First, on FLC, you mentioned that FLC is growing 20% faster than normal product. Can you please guide the proportion of FLC business out of your total GMP? And how would you expect to grow throughout the year? Which categories are driving the faster FLC growth? My second question is, out of your developing offer loss guidance of $40 million. How much do you expect from the international expansion? What are the key takeaways from the recent address marketing in Taiwan? And I'd like to know the Coupang's value position for Taiwan consumers at this point. And also, I would appreciate if you provide some long-term target guidance.

感謝您提供提問的機會，也祝賀您取得如此出色的成績。我有兩個問題。首先，關於FLC，您提到FLC的成長速度比一般產品快20%。請問FLC業務在貴公司GMP（總GMP）中所佔的比例是多少？您預計全年成長如何？哪些類別推動了FLC的快速成長？我的第二個問題是，貴公司製定的4000萬美元虧損預期中，您對國際擴張的預期是多少？最近在台灣的行銷活動有哪些關鍵點？此外，我還想了解Coupang目前對台灣消費者的價值定位。此外，如果您能提供一些長期目標指導，我將不勝感激。

Stanley, thanks for your questions. On FLC, FLC is scaling rapidly, as you point out. It's growing more than twice as fast as our overall business. That just to remind everyone, is driven by the benefits we're providing to both consumers and merchants. FLC enables merchants to leverage our Rocket Delivery network to grow their businesses, and that's been particularly meaningful for small and medium enterprises, or SMEs, many of whom are turbocharging their businesses by getting access to the billions of dollars of investment we've made in infrastructure and technology that they couldn't have built on their own.

史丹利，謝謝你的提問。關於FLC，正如你所指出的，FLC正在迅速擴張。它的成長速度是我們整體業務的兩倍多。需要提醒大家的是，這得益於我們為消費者和商家提供的益處。 FLC使商家能夠利用我們的Rocket Delivery網路來發展業務，這對中小企業（SME）來說尤其重要，許多中小企業透過獲得我們在基礎設施和技術方面投入的數十億美元，從而加速了業務發展，而這些投資是他們自己無法獨自完成的。

Consumers, of course, also benefit from being able to find more and more selection available on Rocket services like Dawn Delivery and Rocket returns. More selection on Rocket historically has driven greater growth. And we're seeing that play out with FLC. It's worth noting that despite the high growth that we've mentioned, FLC still represents a small percentage of total units sold. And with just a fraction of the total selection in the market on FLC, we believe the vast majority of growth lies ahead.

當然，消費者也能從Rocket的服務（例如Dawn Delivery和Rocket Returns）中獲得更多選擇中受益。 Rocket上選擇越多，以往的成長就越快。我們也看到FLC也體現了這一點。值得注意的是，儘管我們提到了高成長，但FLC在總銷量中所佔比例仍然很小。鑑於FLC的商品選擇只佔市場總商品選擇的一小部分，我們相信未來絕大部分的成長空間還在後頭。

To your question about the categories on FLC. FLC is driving growth across all categories, including categories that are emerging like fashion and beauty. We're especially excited about FLC's potential to expand selection dramatically for customers in all categories, especially in highly fragmented and long-tail categories like fashion and beauty. Your second question on Taiwan. Taiwan, as we mentioned, is growing faster than Korea did over the same time period post the launch of Rocket. Our value proposition is the same as Korea. We've always is - we built in Korea would resonate with customers in other markets. That so far, is playing out in Taiwan.

關於您關於FLC品類的問題。 FLC正在推動所有品類的成長，包括時尚和美容等新興品類。我們對FLC能夠大幅擴展所有品類的消費者選擇潛力感到特別興奮，尤其是在時尚和美妝等高度分散且長尾的品類。您的第二個問題是關於台灣的。正如我們所提到的，在Rocket上線後的同一時期，台灣的成長速度超過了韓國。我們的價值主張與韓國相同。我們一直以來都是如此——我們在韓國打造的產品會引起其他市場消費者的共鳴。到目前為止，這一點在台灣正在體現。

While we've just started our service in the market, we're - that customers have responded positively to getting expanded access to Korean selection. We're providing Taiwanese customers access to millions of products from our Korean assortment. Over 70% of which our strategy is this in Taiwan. We'll keep investing and executing in a disciplined and intelligent manner. We'll continue to test, learn and iterate rapidly to improve our customer experience and operations in the market. While we're encouraged by what we see I want to note that we have a lot of work to do. It's still very early in our journey, and we look forward to sharing more on this front when the time is right.

雖然我們的服務才剛在市場上推出，但客戶對擴大韓國商品選擇範圍的回饋非常正面。我們為台灣顧客提供數百萬種韓國商品，其中超過70%的策略重點是台灣。我們將繼續以嚴謹和智慧的方式進行投資和執行。我們將繼續快速測試、學習和迭代，以改善我們的客戶體驗和市場營運。雖然我們對所見所聞感到鼓舞，但我想指出的是，我們還有很多工作要做。我們的旅程才剛開始，我們期待在適當的時候分享更多這方面的資訊。

(technical difficulty)

（技術難度）

All right. And congrats on the strong quarter. Two questions for me. I think along with FLC, you also mentioned that ad growth is growing faster than twofold compared to the revenue. Our understanding is that at market environment wasn't that great in Korea due to macro pressure in second quarter. So what do you think is driving this performance? And where do you think Coupang's ads are in terms of ad penetration against the GMV? And how much runway for growth do you think Coupang still has.

好的。恭喜您本季表現強勁。我有兩個問題。我想除了FLC之外，您還提到廣告成長比收入成長快了兩倍多。我們的理解是，由於第二季的宏觀壓力，韓國的市場環境不太好。那麼您認為是什麼推動了這項業績？您認為Coupang的廣告滲透率與GMV（商品交易總額）相比處於什麼位置？您認為Coupang還有多少成長空間？

And the second question is I'd like to ask some follow-up questions around Taiwan. So you mentioned that you'll be disciplined. So what would prompt you to maybe not pursue Taiwan anymore? As you've done in Japan. So I think you pulled out of Japan. So what would be some of the situation where you would not pursue Taiwan anymore? And I think Stanley also asked this, but beyond this year, what CapEx cycle should we be expecting specifically towards Taiwan?

第二個問題是，我想問一些關於台灣的後續問題。您提到您會嚴格遵守紀律。那麼，有什麼原因會促使您可能不再涉足台灣市場呢？就像您在日本市場那樣。所以我認為您退出了日本市場。那麼，在什麼情況下您不會再涉足台灣市場呢？我想Stanley也問過這個問題，但在今年之後，我們應該預期台灣市場的資本支出週期會是怎麼樣的呢？

Eric, thanks for your questions. On advertising, historically, more selection, more suppliers and merchants has led to more customer engagement. And that, in turn, has led to more opportunities to advertise. We've seen and we expect selection growth and increasing customer engagement to be key drivers of ad growth in the future. As you point out, and as we've mentioned, our advertising business is growing more than twice as fast as our overall business, but we're still very far from our full potential. We mentioned before that operational improvements outside of that drove the bulk of the profit margin expansion this past year. But as it continues to make progress, make strides, and we believe it has the potential to contribute to a higher share of margin gains in the future. Very pleased and optimistic on that front.

Eric，謝謝你的提問。關於廣告，從歷史上看，更多的選擇、更多的供應商和商家會帶來更高的客戶參與。這反過來又帶來了更多的廣告機會。我們已經看到並預計，選擇的成長和客戶參與度的提升將成為未來廣告成長的關鍵驅動力。正如你所指出的，也正如我們所提到的，我們的廣告業務成長速度是我們整體業務的兩倍多，但我們距離充分發揮潛力還很遠。我們之前提到過，除此之外的營運改善是去年利潤率成長的主要推動力。但隨著它不斷取得進展，取得長足進步，我們相信它有潛力在未來貢獻更高的利潤率。我們對此感到非常高興和樂觀。

On the second point about Taiwan, our strategy on how we're going to be disciplined on investment levels beyond this year. I think perhaps it's worth taking a step back and describing a little bit about our strategy and our investment level on developing offerings as a whole. We look at investments in developing offerings as a pool of investment that compounds value across the ecosystem and accelerating tire flywheel.

關於台灣的第二點，我們今年以後將如何控制投資水準的策略。我想或許值得退一步，稍微描述一下我們的策略以及我們在整體產品開發上的投資水準。我們將產品開發上的投資視為一個投資池，它可以在整個生態系統中創造複合價值，並加速輪胎飛輪的運作。

At every turn, we'll assess and allocate dollars within that pool to investments that provide the most promising results. We'll reduce our exit investments, as you pointed out, and as we have done it times in the past, when they don't meet our high thresholds. These investments, our objective is to maximize long-term shareholder value. We laid out our strategy to achieve that in our operating tenants which we shared in one of our first earnings calls post IPO. We'll continue to remain disciplined and abide by those operating tenants, which we published again in our earnings presentation this quarter.

我們會在每個關鍵時刻評估資金池，並將其分配給那些最有前景的投資。正如您所指出的，當投資退出未達到我們的高門檻時，我們會減少投資，就像我們過去多次所做的那樣。這些投資的目標是最大化長期股東價值。我們在IPO後的首次財報電話會議上就營運目標制定了實現這一目標的策略。我們將繼續保持紀律，並遵守這些營運目標，我們在本季的財報報告中再次公佈了這些策略。

As we've noted, our guidance for developing offerings investment in 2023 is $400 million. We expect our investment to remain at these levels. But in every scenario, we expect to generate meaningful free cash flow at the consolidated level. And it's worth noting that this quarter, our level of investment in developing offerings was at that level, and we're still generating significant free cash flow at the consolidated level.

正如我們之前提到的，我們對2023年產品開發投資的預期是4億美元。我們預計我們的投資將保持在這個水平。但在任何情況下，我們都預期在合併層面上都能產生可觀的自由現金流。值得注意的是，本季我們在產品開發方面的投資水平就達到了這個水平，而且我們仍在合併層面上產生可觀的自由現金流。

Your next question comes from the line of John Yu from Citi.

您的下一個問題來自花旗銀行的 John Yu。

Congratulations for the good results. I have 2 questions. Firstly, regarding the product Commerce division, I'm trying to understand each part of growth fields in the second quarter. I heard that you mentioned about the growth rate comparison in the earlier Q&A, but could you please share some more color about the revenue contribution of advertising and FLC in the second quarter?

恭喜您取得如此好的成績。我有兩個問題。首先，關於產品商務部門，我正在努力了解第二季各個成長領域的情況。我聽說您在先前的問答中提到了成長率的比較，您能否再詳細談談第二季廣告和FLC的營收貢獻？

And specifically regarding Taiwan, it would be also helpful if you could share potential CapEx estimates in Taiwan over the next few years. And what would be Coupang's key focus competitive advantage in Taiwan? I'm asking this question in the context of competition, as Taiwanese local players are already operating 1-day delivery option. So how would you describe the competitive landscape in Taiwan?

具體到台灣，如果您能分享未來幾年台灣的潛在資本支出估算，那將非常有幫助。 Coupang 在台灣的主要競爭優勢是什麼？我是從競爭的角度來問這個問題的，因為台灣本地企業已經在提供當日送達服務。那麼您如何描述台灣的競爭格局呢？

John, thanks for the question. I think on product commerce, it's important to note that we just have a single-digit share in the overall retail market opportunity. Active customers are only about half of the total active shopper is available. Our active customer growth is accelerating again this quarter. Tens of millions of customers have yet to join WOW. We continue to grow at a multiple of the market, and our active customer growth is accelerating because we've made unparalleled investments in infrastructure and technology that have enabled us to deliver unmatched customer experience and operational excellence. That applies to our 1P or FLC and even our third-party offerings are also growing at a multiple of the overall market.

John，謝謝你的提問。我認為就產品商務而言，需要注意的是，我們在整個零售市場中只佔個位數的份額。活躍客戶僅佔所有活躍購物者總數的一半左右。本季度，我們的活躍客戶成長再次加速。仍有數千萬客戶尚未加入WOW。我們繼續以市場倍數的速度成長，而我們的活躍客戶成長之所以加速，是因為我們在基礎設施和技術方面進行了前所未有的投資，這使我們能夠提供無與倫比的客戶體驗和卓越營運。這適用於我們的第一方（1P）或FLC，甚至我們的第三方產品也以整個市場的倍數成長。

We're still a tiny share of a retail market that is projected to reach $550 billion in just the next 3 years. And as we've demonstrated quarter after quarter, we're confident that in any scenario, we'll continue to grow at a multiple of the market. For Taiwan, it's too early to discuss specifics, but you can see here that -- and we haven't fulfilled all of our plans and designs to build the same kind of transformational customer experience that we've built in Korea. But the customer response has been terrific. Again, it's early, but we have a track record of execution and disciplined investment. We're encouraged by many things we see. And we have a lot of things to improve, and we look forward to sharing more when the time is right.

在預計未來三年內將達到5500億美元的零售市場中，我們仍然只佔很小的份額。正如我們逐季展現的，我們相信，在任何情況下，我們都將繼續保持數倍於市場的成長。對於台灣地區，現在討論具體細節還為時過早，但您可以看到——我們尚未完成所有計劃和設計，以打造與韓國地區相同的變革性客戶體驗。但客戶反應非常好。再次強調，現在還為時過早，但我們在執行力和嚴謹的投資方面有著良好的記錄。我們看到的很多事情都令人鼓舞。我們還有很多需要改進的地方，我們期待在適當的時候分享更多資訊。

Yes. John, on your first question of contribution to revenue in Q1 call, we had highlighted that FLC change impacts net revenue by about 540 bps. That gives you indication and magnitude of the contribution of revenue of FLC to our net revenues.

是的。約翰，關於您在第一季電話會議上提出的第一個關於收入貢獻的問題，我們之前強調過，FLC 的變化會對淨收入產生約 540 個基點的影響。這能讓您了解 FLC 的收入對我們淨收入的貢獻程度。

Your next question comes from Seyon Park of Morgan Stanley.

您的下一個問題來自摩根士丹利的 Seyon Park。

I have 2 questions. If you look at the gross profit coming from product farmers, it increased about $150 million sequentially. I was wondering whether you can provide us with a little bit more color as to what drove that increase, whether the contribution and the ramp-up of FLC is a large part of that increase or whether we're seeing it from better margins from the pure 1P business or some contribution coming from advertising. That's my first question.

我有兩個問題。如果您看一下來自產品農場主的毛利，它環比增長了約1.5億美元。我想知道您能否更詳細地解釋一下推動這一成長的原因，FLC的貢獻和成長是否佔了很大一部分，還是純1P業務利潤率的提高，或者廣告業務的貢獻？這是我的第一個問題。

The second question is on AI or seeing a lot of vibe and talk about AI. I know that Coupang has been using AI and predicting the demand at each of the regions and the like. And I was just curious, given that AI has become such a big topic this year, whether that has led to any changes to your AI strategy or whether you have plans to more or adopt I guess, more of some of this generative AI to your products going forward?

第二個問題是關於人工智慧，或者說，我看到很多關於人工智慧的討論和氛圍。我知道Coupang一直在使用人工智慧，預測各個地區的需求等等。我很好奇，鑑於人工智慧今年成為如此熱門的話題，這是否導致了你們人工智慧策略的改變？或者，你們是否有計劃在未來的產品中更多地採用這種生成式人工智慧？

Thanks, Seyon. On the gross margin drivers. The drivers of margin improvement are consistent with what we've shared before. We've been driving continuous improvement that leverage our years of investment in technology infrastructure, supply chain optimization and new services among others. Again, we don't expect every initiative to bear fruit immediately or evenly every quarter. But we remain very confident about our long-term margin opportunity here and our ability to achieve our long-term guidance of higher than 10% adjusted EBITDA.

謝謝，Seyon。關於毛利率的驅動因素。利潤率提升的驅動因素與我們先前分享的一致。我們一直在推動持續改進，充分利用我們多年來在技術基礎設施、供應鏈優化和新服務等方面的投資。再次強調，我們並不期望每項措施都能立即或平均每季取得成果。但我們對長期利潤率成長機會以及實現調整後EBITDA高於10%的長期目標的能力仍然充滿信心。

And we'll continue to make significant operational improvements over time that will enable us to keep lowering prices for customers and expand margins. On AI, you're right that AI has been a powerful technology that we've deployed across virtually every facet of our business from rocket-related operations to search ads, customer service, supply chain management, just to name a few. We're currently evaluating opportunities to take advantage of the recent advances in AI. It's consistent with the strategy that we've always held and we'll continue to invest in AI teams and tools to drive efficiencies and enhance the customer experience.

我們將繼續進行重大的營運改進，這將使我們能夠持續降低客戶價格並提高利潤率。關於人工智慧，您說得對，人工智慧是一項強大的技術，我們幾乎將其應用於業務的方方面面，從火箭相關營運到搜尋廣告、客戶服務、供應鏈管理等等。我們目前正在評估利用人工智慧最新進展的機會。這與我們一直以來的策略一致，我們將繼續投資人工智慧團隊和工具，以提高效率並提升客戶體驗。

Your next question is from James Lee of Mizuho.

您的下一個問題來自瑞穗的詹姆斯李 (James Lee)。

Congrats again on good numbers. And 2 questions here. First, maybe can we give some more color on food delivery. Can you maybe talk about the progress in cross-selling to members with the discount? And also provide some update. I think in the past, you talked about you want to leverage more of the fixed cost of existing asset drivers on e-commerce as opposed to slowly relying on variable costs. Maybe can you speak to that a little bit?

再次恭喜您取得如此好的業績。我有兩個問題。首先，我們能否進一步介紹外送的情況？能否談談透過折扣向會員進行交叉銷售的進展？並提供一些最新進展。我記得您之前提到過，您希望更多地利用現有資產驅動因素的固定成本來推動電商業務，而不是緩慢地依賴可變成本。能否就此稍微談談？

And second question is more about -- in the past, you guys talked about the progress of expanding selections. You guys have talked about one of the frictions or not for accelerating membership is to be able to have more selections and that will drive more adoption to your membership. And I was wondering which categories you are making progress, which categories you're hoping to improve going forward.

第二個問題更多是關於——過去，你們談到了擴大選擇範圍的進展。你們談到了加速會員成長的阻力之一，即能否提供更多選擇，這將推動更多會員採用。我想知道你們在哪些類別上取得了進展，以及你們希望在未來改進哪些類別。

James, thanks for your questions. On the first topic on Eats, we have seen synergies across the board. We mentioned a few of those points in our call earlier. We've seen an 80% increase in total on membership total while members participating in seen 20% increase in WOW members spent on Eats. In addition, we've seen WOW members engagement on product commerce go up. We've seen low retention also higher among customers who engage on it.

James，謝謝你的提問。關於第一個關於 Eats 的話題，我們已經看到了全面的綜效。我們在先前的電話會議中提到了其中幾點。我們的會員總數增加了 80%，參與的會員在 Eats 上的消費也增加了 20%。此外，我們也看到 WOW 會員在產品商務上的參與度有所提升。我們發現參與 WOW 的顧客的留存率也有所提高。

We also, of course, have behind the scenes, lots of opportunities to pursue synergies on the operational side. I think we continue to pursue synergies and efficiency gains on multiple fronts, but we're really excited that we're able to drive a compound value of these offerings across our whole ecosystem. And I want to stress again that our goal is to make this -- all of this is in service of our goal to make wow the best deal on the planet for customers.

當然，我們在幕後也有很多機會在營運方面實現協同效應。我認為我們會繼續在多個方面追求協同效應和效率提升，但我們非常高興能夠在整個生態系統中推動這些產品的複合價值。我想再次強調，我們的目標是——所有這些都是為了實現我們的目標：讓WOW成為全球客戶最划算的選擇。

With the majority of WOW members yet to have made a purchase on each this benefit has the potential to not only drive growth on each, but to supercharge their engagement on product commerce and create even more value surplus for our members on WOW. On selection, we're seeing -- and our mission is to drive selection expansion across every category and every segment of customer spend. There are many emerging categories. We're a retailer with less than 10 years under our belt. And many of our emerging categories like Fashion Beauty is just a few years old on Rocket. So we have low penetration across all categories, but there are emerging categories with a specialty low penetration. It just again highlights how early we are in our journey, and we're excited to expand our customer value proposition, particularly along selection across all categories and all segments for our customers.

由於大多數 WOW 會員尚未在每家商店進行購買，因此這項福利不僅可以推動每家商店的成長，還可以增強他們對產品商務的參與度，並為 WOW 上的會員創造更多價值盈餘。在選擇方面，我們看到—我們的使命是推動每個類別和每個客戶支出細分市場的選擇擴展。有許多新興類別。我們是一家成立不到 10 年的零售商。我們的許多新興類別，例如時尚美容，在 Rocket 上只有幾年的歷史。因此，我們在所有類別的滲透率都很低，但有些新興類別的滲透率特別低。這再次凸顯了我們正處於發展的早期階段，我們很高興能夠擴展我們的客戶價值主張，特別是為客戶提供所有類別和所有細分市場的選擇。

We will now take our last question from the line of Jiong Shao of Barclays.

現在我們來回答巴克萊銀行邵炯提出的最後一個問題。

Let me add my congrats as well. My first question is a follow-up on FLC. I think a quarter ago, you talked about FLC was about 4% of the units. Could you talk about the percentage of units for the 3P part? And could you also elaborate a bit on the rate-limiting factor prevent FLC to grow even faster? Is that because of the capacity issue, you have? Any color you can share about merchant adoption rate, if any member you can share that would be awesome.

我也想表達我的祝賀。我的第一個問題是關於FLC的後續問題。我記得一個季度前，您提到FLC大約佔總銷售量的4%。能談談第三方平台的銷售佔比嗎？您能詳細解釋一下是什麼限制了FLC的成長速度嗎？是因為容量問題嗎？能分享一下商家採用率的具體資訊嗎？如果您能分享任何會員的情況就太好了。

Second question is, again, a clarification around Eats. You talked about the WOW members using Eats up 80% year-over-year. Could you talk about penetration rate? Again, among your WOW members, what's the rough percentage of them are currently using Eats now. I heard you're saying that Eats is now profitable. I think I heard the unit economics is positive. I just want to confirm that's indeed the case.

第二個問題是關於 Eats 的澄清。您之前提到，使用 Eats 的 WOW 會員年增了 80%。能談談滲透率嗎？再問一下，在您的 WOW 會員中，目前使用 Eats 的會員大概佔比多少？我聽說您說 Eats 現在已經獲利了。我好像聽說它的單位經濟效益是正數。我只是想確認一下情況確實如此。

Joe, thanks for the question. I think FLC, as you can see, it's going very fast. We shared that it's going more than twice as fast of business. So I don't think there are any blockers or of course, there's always improvements -- as with any new service, we have continuous improvement. There are aspects to continue to improve on the consumer side, on the merchant side, and our teams are hard at work to build the right technology, the right processes, the right experiences. So that's the continuing work that we continue to do.

喬，謝謝你的提問。如你所見，我認為 FLC 發展得非常快。我們之前提到過，它的業務成長速度是之前的兩倍多。所以我認為沒有任何阻礙，當然，我們一直在改進——就像任何新服務一樣，我們也在持續改進。在消費者端和商家端，我們還有一些方面需要持續改進，我們的團隊正在努力建立合適的技術、合適的流程和合適的體驗。所以，這就是我們持續進行的工作。

But as you can see, FLC adoption has been very positive on both the consumer front and on the merchant front. And we've shared - I think last quarter, you're right, we showed I think we can share again this quarter that FLC still represents a small percentage of total units sold and it has a tiny fraction of the total selection in the market. And we believe there are many, many merchants, especially small and medium enterprises, or SMEs, for whom it would be very expensive to recreate the level of service and growth opportunities that FLC provides.

但如您所見，FLC 在消費者和商家方面的採用都非常積極。您說得對，上個季度我們已經表明，FLC 仍然只佔總銷量的一小部分，而且在市場選擇中只佔很小一部分。我們相信，對於許多商家，尤其是中小企業（SME），要重現 FLC 提供的服務和成長機會，成本將非常高。

And we're excited to expand access to Rocket Deliveries for small merchants, including SMEs. And to help them grow, we're also excited to bring the benefit of more and more of the selection to our customers on rocket services like Dawn Delivery and Rocket Returns. On while membership engagement on Eats, I think we can also share here that the majority of WOW members have yet to make a purchase on Eats. And we did focus over the last few quarters to make Eats unit economics positive.

我們很高興能為包括中小企業在內的小商家拓展 Rocket Deliveries 的服務。為了幫助他們發展，我們也很高興能為 Dawn Delivery 和 Rocket Returns 等 Rocket Deliveries 服務的客戶提供更多選擇。關於 Eats 的會員參與度，我想我們也可以分享一下，大多數 WOW 會員尚未在 Eats 上購買任何商品。過去幾個季度，我們確實致力於讓 Eats 的單位經濟效益保持正成長。

We've taken those positive contribution profits to reinvest in the form of this benefit that we believe is generating ROI, not only in Eats but across the whole ecosystem in product commerce, WOW membership and Eats. So I think with both FLC and we are still early in our journey. It is just getting started, and we'll continue to make progress. There is still lots of work to do, still lots of improvements to make across the board, and we look forward to updating you in greater detail in the future.

我們已將這些正向貢獻利潤以這種福利的形式進行再投資，我們相信這不僅在 Eats 平台，而且在整個生態系統（包括產品商務、WOW 會員和 Eats）中都能產生投資回報。因此，我認為 FLC 和我們都還處於起步階段。一切才剛開始，我們將繼續取得進展。我們還有很多工作要做，還有很多需要全面改進的地方，我們期待在未來為您提供更詳細的更新。

This concludes today's conference call. You may now disconnect.

今天的電話會議到此結束。您可以掛斷電話了。