Delivery trucks wait at a Coupang logistics center in Seoul. Yonhap News
Coupang Inc., the U.S. parent company of Coupang, disclosed on the 4th that Coupang had received a notice of proposed taxation of approximately 300 billion won from the National Tax Service. The company also estimated the damage from the recent fire at its Incheon logistics center at 350 billion won.
In its second-quarter consolidated earnings report filed with the U.S. Securities and Exchange Commission (SEC), Coupang Inc. disclosed that the National Tax Service (NTS) had sent a notice of tax audit results for its Korean subsidiary, Coupang Fulfillment Services (CFS), covering the 2021 through 2025 tax years. According to the document, the notice from the NTS amounted to approximately $208 million (about 300 billion won), including penalties and interest.
Earlier, the Seoul Regional Tax Office launched a special tax audit of Coupang’s logistics subsidiary, Coupang Fulfillment Services, last December, and is understood to have recently concluded the audit and issued the notice of proposed taxation. In the report, Coupang said of the measure that it “intends to vigorously defend its position through available administrative remedies and, if necessary, judicial proceedings.” The company also explained that as of the end of June, its contingent liability provisions for the taxation were at a sufficient level.
Separately, regarding the recent fire loss at its logistics center in Seongnam-dong, Incheon, Coupang Inc. said it “is estimated at $246 million (about 350 billion won), including the total book value of the facility’s self-owned inventory and fixed assets before the fire, as well as amounts payable related to sellers’ inventory stored at the facility.”
The loss is scheduled to be reflected starting from third-quarter results. The company said it plans to file an insurance claim but noted that there may be additional liabilities and costs that are currently unidentified or cannot be quantified.
Coupang announced that day that its second-quarter operating loss was 835 billion won, swinging to a loss from a year earlier. Following an operating loss of 354.5 billion won in the first quarter, this marked two consecutive quarters of losses. The second-quarter net loss was 856 billion won, turning to a loss from 43.5 billion won a year earlier.
This is the largest quarterly operating loss and net loss for Coupang Inc. in the five years since its 2021 listing. The cumulative first-half operating loss also exceeded 1 trillion won for the first time. This is equivalent to the combined operating profit Coupang Inc. earned over the past two years.