Loaded - Liquid - Lean

Coupang

Founded in 2010 by Bom Kim, Coupang has become the Amazon of South Korea. What began as an online marketplace rapidly evolved into a vertically integrated logistics and retail ecosystem that delivers millions of products, often within hours. Coupand operates in the e-commerce and consumer services industry but has a foothold in technology, logistics, and consumer infrastructure. Coupang’s goal isn’t to become a dominant player in South Korea but to become the go-to platform for retail, delivery, streaming, and financial services across Asia. 

In 2024, Coupang made some mf moves that redefined the company’s profile, revenue saw a 30% increase, margins increased, and turned the previously unprofitable luxury platform Farfetch into a break-even asset. Its boost in strong margins came from scaling automation, optimizing fulfillment, and expanding high margin services like advertising and third party logistics. In Taiwan, its operation has grown significantly, validating the variability of its logistics and service model beyond the Korean borders. With less than 15% of its centers currently automated, the dawgs have substantial room for improvement, showing massive long-term growth and operating leverage abilities. 

Coupang is worth analyzing because it's a rare hybrid, they are growing aggressively, capital efficient, and have successfully monetized several high-frequency vertices. Coupang has a very strong logistics network, its user base is embedded in the WOW membership program, and its merchant ecosystem increasingly relies on the company's infrastructure to operate. we/them/boys believe that Coupand is undervalued due to its full-stack architecture and strong reach to consumers across Asia. If their growth plans are successful they will be able to eat their competitor's breakfast, lunch, and dinner while they dominate the Asian e-commerce market. 

We will be evaluating Coupangs ability to scale its core competitive advantages like its logistics platform, data, and capital efficiency. Dem boys will be looking into its new business vertices like Coupand Eats, Coupand Play, and its recent Farfetch acquisition as they represent long term revenue drivers. With great revenues comes great responsibility, Coupang also faces external threats from regulators and competitors that are trying to slow the crew down. Our goal is to determine whether Coupang represents a long-term compounder with structural advantages or just a high/fast growth flash in the pan. 

Coupangs 2024 financial results are nice, the company reported total revenues of $30 billion, up 25% YoY. Its gross profit jumped up to 43% to $8.3 billion, while its gross margins rose from 25% to 30%. However, its net income took some major shots declining from $1.36 billion in 2023 to only $66 million in 2024, due to tax windfalls and insurance gains. It's developing offerings segment that includes Coupang Eats/Pay and Farfetch, while these segments remain unprofitable they saw margin improvements. Coupang’s ability to grow while improving its bottom line sets it apart from the other e-commerce hounds, its ability to balance makes it more valuable to investors and dangerous to competitors. 

As of now, Coupang’s stock is underappreciated by the market as its PE ratio and other valuation metrics are lower than its competitors. Its EV/EBITDA is currently around 20-25x which is much lower than its global peers like Amazon, MercadoLibre, and Sea. Coupang is still priced like a trailer, but it's a technology-powered logistics and commerce monster. It owns its infrastructure, controls the customer experience, and is building hard-to-replicate segments. Coupang is building a consumer operating system for Asia, once this ecosystem has scaled and is embedded within communities it will be hard to compete with. 

What sets Coupang apart from most fast growing companies, is its ability to generate real dollars not just flashy revenue numbers. In 2024, the company generated $1.9 billion in operating cash flow and over $1 billion in free cash flow. Coupang also spent 3% of its revenue on capex, mostly to expand its fulfillment network and scale automation. This enables them to not just build bigger but build smarter while other platforms are still relying on outside funding or debt. Coupang is in control, they don’t need to dilute shareholders the business is liquid, lean, and loaded, ready to strike whenever the opportunity strikes itself

Coupang is at the high stakes table within the e-commerce and the digital consumer services sectors, both are massive and highly competitive. The Asian e-commerce market is worth over $3.5 trillion and is growing fast, driven by digital penetration, consumer expectations, and the rising tide of mobile-first consumer behavior. South Korea is one of the most advanced digital economies in the world, with over 90% of its population shopping online. While many players in the global e-commerce game have chosen to scale through third party infra or external funding, Coupang has taken a different route. Coupang owns its platform enabling it to optimize every facet of its business. 

Coupang’s product offering goes beyond a traditional marketing place, although its core product is product commerce which includes everything from groceries, electronics, and fashion. This segment accounts for $26 billion out of the total $30 billion in 2024 revenue. This segment has strong margins due to its operational efficiency and high customer engagement. Within this segment is Rocket Delivery, its crown jewel that offers millions of products that are available for same-day delivery with no minimum order size. Its core product is surrounded by Coupang’s “Developing Offerings” which include Coupang Eats, Coupang Play, Coupang Pay, and Farfetch (a luxury e-commerce platform). While these platforms are not yet profitable they have become critical as they help increase platform stickiness and build more customer data points. Behind all these services is Coupangs real product, its logistics, and its technology platform. Its infrastructure is the company’s foundation on which all its vertices sit and is what enables Coupand to scale its services into new markets without losing quality or control. 

Coupang’s competitors are fairly nonexistent within Korea, but its closest rivals are SSG, 11st, and Gmarket. However, all these ‘competitors’ rely on third party logistics or marketplaces for their fulfillment layer. Amazon has low penetration in Asia, and Alibaba’s focus remains on China, simply put no other player matches Coupang's execution within the Korean markets.  Coupangs ability to execute at scale, while maintaining control of its supply chain puts it in a different category, closer to Amazon in its early days of prime and FBA than any regional player. What sets Coupang apart is its customer loyalty and speed, Coupang owns its fulfillment centers, delivery fleet, and increasingly its merchant logistics layer. Enabling to drive down the cost per delivery while improving service, something that competition can’t match. This creates high barriers to entry, especially for new nerds who hope to copy the Coupang model. 

Coupang has built that mf moat, built on vertical integration, scale, and operational consistency and efficiency. The boys control their entire supply chain from procurement to product delivery. This allows them to move faster, cheaper, and with higher quality than its rivals. In 2024, Coupang doubled its automation within its fulfillment centers, and logistics costs dropped 16% as a result. This advantage is not easily replicated, particularly in Korea’s dense urban geography where land, labor, and logistics are expensive and complex. Coupangs WOW membership program is another competitive advantage, for a monthly fee customers receive faster delivery, access to Coupand Eats and Play, free returns, and even installation services for large foods. This results in high retention, larger order size, and daily engagement across multiple vertices. Coupang is building a merchant moat through Fulfillment by Coupang which offers sellers warehousing, delivery, and customer service under one roof. This is the beginning of a product that could eventually mirror Amazon’s third-party seller dominance. 

The global e-commerce and digital consumer services industry is a multi-trillion dollar industry that includes a wide range of sectors. Key sectors include product commerce, digital marketplaces, last mile logistics, on demand services, and digital financial services. In Asia, E-commerce is not only mobile first but often super app-driven, with platforms offering bundled services like ride-hailing, payments, and shopping under a single interface. Emerging regions in Asia are seeing rapid growth in third-party logistics and merchant enablement platforms, helping digitize small businesses and informal economies. The supply chain segment of the industry has also emerged as a critical sub-sector with warehousing, automated fulfillment, route optimization, and real-time tracking having become essential products in the competitive customer ecosystem. The fastest growing companies in the space are not those with the most SKU or flashiest website, but those with the most advanced supply chain. 

Several macro and micro forces are driving sustained growth across e-commerce and consumer services including demographic tailwinds, technological infrastructure improvements, and platform economics. Asia is seeing a rise in its middle class, younger digital native consumers are fueling higher per capita online spending and consumers are demanding more convenience, better product selection, and faster fulfillment. This is forcing players to constantly innovate on delivery services and platform capabilities. Also, technological infrastructure improvements like mobile broadband penetration, faster payment rails, cloud computing, and edge-based AI. Finally, companies are no longer judged on just GMV or active users, but on monetization efficiency per user and cash flow per transaction. The industry is rapidly maturing into a game of vertical integration, lifetime value expansion, and operational leveraging. 

Big data, machine learning, and artificial intelligence are no longer edge case applications, they are becoming the backbone of the digital commerce industry. The leading platforms are deploying trillions of machine learning predictions per day, this will enable them to optimize everything from delivery routes to fraud detection. Fulfillment and logistics are undergoing a second wave of disruption through robotics and automation as drone delivery, autonomous vehicles are starting to move from pilot phases into real deployment in dense urban markets Additionally embedded financial technology platforms like BNPL and digital wallets are becoming integral parts of user retention and monetization. 

Consumer expectations have rapidly evolved, shoppers today are wild beasts. Consumers now demand fair pricing, speed, reliability, supply chain transparency, free returns, and 24/7 customer services becoming baseline expectations. Some nerds also care about sustainability (Azar Capital Group does not care about it) and they are asking questions about packaging waste, carbon footprints, ethical sourcing, and labor practices. Lastly, the shift toward services over products is reshaping the monetization model as consumers now expect platforms to offer an ecosystem. This shift is huge in Asia, where “super-apps” are becoming central to how people eat, shop, pay, and live. 

The total addressable market for e-commerce and digital consumer services remains massive and underpenetrated in many regions. In Asia, digital commerce penetration is below 25% of total retail in key regions like India, Vietnam, and the Phillippines. One major trend is the geographic shift of growth from Tier 1 cities to Tier 2 and 3 markets. As logistics infrastructure expands and delivery networks become more effective, platforms are penetrating lower-density regions where online purchasing behavior is still low. Operational capacity is scaling including cloud infrastructure, modular fulfillment centers, and AI-driven inventory allowing platforms to scale without sacrificing speed or quality. The next wave of digital commerce will not be defined by who can grow the fastest but who can scale profitability and defensibly across markets. 

Coupang’s organic growth engine is firing on all cylinders, with its core producer generating $26 billion in revenue in 2024 and expected to grow 13-15% YoY. With a strong user base in Korea and growth in Taiwan, Coupang is not growing through customer acquisition, but by adding serious value to existing customers. The company's innovation pipeline is focused on both automation and vertical expansion, Coupang has massive room to expand its margins through robotics, AI systems, and fulfillment efficiency. The expansion of WOW membership across the Coupang Eats/Play/Pay is also becoming more compelling which will boost customer lifetime value. With each international launch, Coupang is not just replicating growth but it’s expanding its ecosystem and reinforcing the same infrastructure leverage that made it dominant in Korea.  

Duh boys over at Coupang have historically relied on and favored organic growth but have proved their ability to be bold and acquire a MFer if need be. In 2013, Coupang acquired Calmsea, a startup that specializes in predictive analytics for e-commerce. Then in 2023, Coupang decided to acquire the cash-burning company called Farfetch. Farfetch is a luxury e-commerce player, that became breakeven under Coupangs operational control in less than a year.  This acquisition gave Coupand access to high-margin, global consumers, and luxury infrastructure that would’ve taken years to build. By applying its logistics and technology discipline, Coupang has turned liabilities into a scaleable growth lever. This playbook could be repeated across vertices, making Coupand well-positioned to acquire underperforming platforms or regional players. Strategic partnerships may also accelerate growth without the risks that come with acquisitions. With over $1 billion in annual free cash flow and the proven ability to execute, Coupang has both the capital and the credibility to make moves.

Coupangs short-term and long-term growth will be powered by several catalysts that include continued logistics investment, its fulfillment by Coupang segment, and international expansion. In 2024, Coupang doubled its fulfillment automation capabilities which led to a 16% drop in logistics costs.  Another major catalyst is Fulfillment by Coupang, which is scaling fast and generating strong revenues. As more third-party merchants join FLC, Coupang will be able to monetize its infrastructure while reducing inventory risks. Combined with in-app advertising and data-driven promotion, FLC could evolve into a standalone revenue engine with marketplace economics. If Coupang successfully localizes its stack and bundles its membership program in multiple its TAM would expand massively. Coupang has the capital, infrastructure, and operational expertise to make that leap. 

Coupang’s vertically integrated model is a strong advantage but also exposes it to operational risks that include its supply chain, management execution, logistical fragility, and geopolitical tension. Any disruption in warehousing, system outages, workforce shortages, or fleet inefficiencies can have an immediate and widespread impact. Also, the complexity of integrating Farfetch, building out Coupang Eats, and scaling WOW membership requires top tier leadership. Misalignment in priorities, overextension of management bandwidth, or strategic dilution could result in major inefficiencies or delayed ROI on key growth drivers. Unlike asset-light marketplaces, Coupang’s performance is tied to the reliability of its infrastructure. This creates massive upside through control, but also risk through its complexity. 

Coupang operates in one of the most regulated and competitive sectors in Asia. Also, Korean law is strict on issues like labor classification, consumer protection, and corporate liability, where senior leadership can be held personally accountable for compliance violations. If competitors begin to replicate Coupang’s delivery speeds or undercut its margins through subsidies, the cost of defending its market share could rise quickly. While Coupangs’s business is built on high frequency, essential goods, economic shifts any changes in consumer behavior or inflation could disrupt the company's core revenue drivers. Market conditions in international markets Taiwan or Japan may not mirror the Korean consumer playbook, increasing uncertainty around scalability.

Coupang’s current valuation shows a mix of optimism and execution expectations. Any deviation in its growth or failure to develop its products could lead to a sharp decline in the stock valuation. Also, investor expectations are high for its new segments like Coupang Eats/Pay/Play but if these segments fail to scale or remain unprofitable, the market may begin to discount their long-term potential. Lastly, Coupand is a U.S. listened firm with its operations concentrated in Korea, meaning they are exposed to currency fluctuations, geopolitical noise, and global interest rates

Coupang has evolved from a cash-burning e-commerce disruptor to a cash generator platform with tier 1 infrastructure, execution, and optionality to build a dominant consumer operating system across Asia. Generating over $30 billion in revenue in 2024 and over a billion in free cash flow, Coupang has shown its agility and ability to operate efficiently. Coupang is well positioned to scale beyond Korea, they are already making strong moves in Taiwan and Japan. The company faces several risks that include the inability to execute its expansion, regulatory pressures, and its developing offerings segment. 

The bad boys over at Azar Capital Group will be giving Coupang a ‘BUY’ rating due to its massive growth potential and ability to turn assets that are losing tons of money to breakeven or profitable in a short amount of time. Unlike many companies, Coupang is funding its growth with its cash flow rather than dilution or debt. Long term, them dawgs Coupang is extremely well positioned to expand its margins and business over time, as it owns its supply chain and customer relationship. Coupang TAM expands every time it enters a new market, we believe that dem boys are well positioned for long-term growth and the ability to successfully scale its supply chain. 

Disclosure

Buckle up—this analysis is strictly for informational and entertainment purposes only and is absolutely, positively NOT financial, investment, legal, or professional advice of any kind. It’s not a golden ticket, a sure bet, or a substitute for your own brainpower. Markets are a rollercoaster, and losses can hit harder than a freight train—consider yourself warned. Investors must do their own hardcore due diligence, dig into the details, and/or consult a licensed financial advisor, accountant, lawyer, or whoever else you trust before even thinking about making investment decisions. Past performance? It’s not a fortune teller’s promise for future gains—things can and will go sideways. The author, this platform, and anyone remotely connected to this content take zero responsibility for your financial moves, wins, or wipeouts. Proceed at your own risk, and don’t come crying to us if the market bites back!