fine, and Farfetch-related losses, Coupang’s net income was a healthier $407 million. The New York-listed firm reported net revenues of $8 billion for the quarter ending December 31, reflecting a 21 per cent increase on a reported basis and a 28 per cent surge on an FX-neutral basis. Notably, even when excluding the impact of the Farfetch acquisition, revenues still exhibited healthy growth at 14 per cent (reported) and 21 per cent (FX-neutral). While experiencing growth, Coupang faces heightened competition from Chinese e-commerce giants. PDD Holdings’ Temu and Alibaba Group’s AliExpress have established themselves as formidable competitors through aggressive marketing campaigns. The competitive landscape intensified last month when Shinsegae Group partnered with Alibaba Group to create a strategic e-commerce alliance. This joint venture, alongside Naver’s shopping platform, is scheduled to launch in the first half of 2025. Industry analysts predict this will make 2025 Coupang’s most challenging year since it gained market dominance during the pandemic. Despite these challenges, Coupang remains optimistic about its growth prospects both domestically and internationally. The company’s strategic investments and expansion efforts represent a calculated response to increasing competitive pressures. “Our growth story extends far beyond Korea. We believe the playbook we pioneered in Korea can be applied in other markets with equal success,” said Kim Bom, founder and CEO of Coupang.  In Taiwan, where Rocket Delivery launched in late 2022, Coupang has gained momentum with 23 per cent quarter-over-quarter revenue growth. The company has further strengthened its position in the Taiwanese market by introducing its Wow membership program, enhancing customer loyalty and engagement. The Farfetch Turnaround: From Loss to Breakeven Meanwhile, Farfetch has shown promising financial improvements under Coupang’s management. In 2024, it generated $1.7 billion in revenue while significantly reducing losses to just $34 million – a substantial improvement compared to its last publicly reported financials in 2022, when it recorded $2.3 billion in revenue with losses of $98.7 million. “When we acquired Farfetch at the beginning of 2024, it was losing hundreds of millions of dollars annually and facing declining growth metrics,” Bom said. “Yet within this challenge, we saw a rare opportunity. Farfetch was a sector leader with roughly $4 billion in annual transaction volume and a global brand in luxury fashion.” “In the year since the acquisition, our team applied the same relentless, disciplined execution that defines Coupang’s operations,” he added.  Having acquired UK-based luxury fashion retailer Farfetch for $500 million in early 2024, Coupang has implemented significant operational changes. The company confirmed that CEO Kim does not plan to engage in further share transactions until the end of 2026. Coupang said Farfetch posts 49 million monthly visitors.  “We made tough decisions with the aim of simplifying operations and refocusing the teams on the only two things that truly matter – customer experience and operational excellence. The results speak volumes. Farfetch’s losses have shrunk dramatically, to a breakeven run-rate today, and this significant turnaround was achieved with minimal loss of scale.” “While we’re proud of what the Farfetch team has accomplished so far, we’re even more excited about the potential for the team to build on this promising foundation to deliver innovations that will transform the customer experience in global luxury commerce,” Bom said.   However, according to seven current and former employees interviewed by The Business of Fashion, Coupang’s cost-cutting strategy has eliminated key elements that established Farfetch as a leader in online luxury retail. These sources suggest that while the cuts improve short-term financial results, they may ultimately compromise Farfetch’s relationships with luxury brands and high-end customers. Farfetch has cut its VIP client services teams in key cities, replacing personalised shopping assistance with automated tools. High-spending customers, once pampered with exclusive fashion week events, now receive downgraded experiences. Logistics changes, switching shipping providers and centralising customer service, have resulted in delays and frustration among top-tier shoppers. Luxury brands are pulling away from Farfetch, with Kering, Celine, and Alaia cutting ties due to pricing disagreements and lack of control over product presentation. Luxury e-commerce is expected to grow significantly in the coming years, with online sales projected to reach 33 per cent of total luxury sales by 2030, up from 20 per cent in 2024, according to Bain & Company research. Further reading: Coupang’s financial paradox: Record revenue amid profit decline in Q3.