Coupang Inc

Liquidity

Liquidity is a measure of our ability to access sufficient cash flows to meet the short-term and long-term cash requirements of our business operations. Our primary sources of liquidity are cash on hand, supplemented through various debt financing arrangements and sales of our equity securities. We had total cash, cash equivalents and restricted cash of $5.6 billion as of December 31, 2023, of which $3.9 billion was held by our foreign subsidiaries and may not be freely transferable to the U.S due to local laws or other restrictions. Additionally, we have $875 million available under the Revolving Credit Facility as amended in January 2024, as described below.

The ability of certain subsidiaries to transfer funds or pay dividends to Coupang, Inc. is also restricted due to terms which require the subsidiaries to meet certain financial covenants, including requirements to maintain a positive net equity balance or having current period income.

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As of December 31, 2023 and 2022, we had stockholders’ equity of $4.1 billion and $2.4 billion, respectively. We have periodically incurred losses in prior periods and may incur losses in the future. We expect that our investment into our growth strategy will continue to be significant, particularly with respect to our Developing Offerings segment, which will continue to focus on our newer offerings and entrance into new geographies, as well as overall expansion of our fulfillment, logistics, and technology capabilities. As part of this expansion to fulfill anticipated future customer demand and continuation to expand services, we plan to build new fulfillment centers. We have entered into various new construction contracts for capital projects which are expected to be completed over the next three years. These contracts have remaining capital expenditures commitments of $114 million as of December 31, 2023. We expect that our future expenditures for both infrastructure and workforce-related costs will exceed several billion dollars over the next several years.

At closing of the Farfetch Acquisition, a Coupang subsidiary provided additional cash funding to Farfetch of $150 million, and contributed the outstanding $150 million bridge loan towards the Farfetch Acquisition. The limited partnership is further obligated to fund Farfetch up to $200 million within twelve months of the acquisition date.

Changes in our cash flows were as follows:

Operating Activities

The year-over-year change in operating cash flow was primarily driven by a $1.5 billion improvement in net income (loss), which resulted in net income for the year. Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities included changes in deferred income taxes of $843 million. Additionally, benefiting the improvement in cash used in operating activities were the changes in operating assets and liabilities, including a decrease in inventories of $323 million primarily from the implementation of the new FLC program combined with improved inventory management, and an increase in accounts payable of $1.1 billion primarily as a result of increased volume of purchases as well as improved payment terms, primarily with certain large, multi-national suppliers, partially offset by a reduction in payables from the FLC changes.

Investing Activities

The increase was primarily driven by the $75 million bridge loan made to Farfetch as of December 31, 2023, and a $72 million increase in purchases of property and equipment, primarily related to investments made in the current year in our fulfillment and logistics infrastructure, including purchases of buildings, land and equipment.

Financing Activities

The decrease was primarily driven by a $129 million decrease in proceeds from debt and short-term borrowings, partially offset by a $75 million decrease in repayments of debt and short-term borrowings due to the timing of maturities.

We believe that our sources of liquidity will be sufficient to meet our anticipated cash requirements for at least the next 12 months. However, we may need additional cash resources in the future if we find and pursue other opportunities for investment, acquisition, strategic cooperation, or other similar actions, which may include investing in technology, our logistics and fulfillment infrastructure, or related talent. If we determine that our cash requirements exceed our amounts of cash on hand or if we decide to further optimize our capital structure, we may seek to issue additional debt or equity securities or obtain credit facilities or other sources of financing. This financing may not be available on favorable terms, or at all.

Capital Resources

We have entered into material unconditional purchase obligations. These contractual commitments primarily relate to technology related service contracts, fulfillment center construction contracts, and software licenses. We generally enter into term loan facility agreements to finance the construction of our fulfillment centers. These agreements may require that we provide for collateral equal to or greater than the amount borrowed under the arrangement. As we continue to build or purchase additional fulfillment centers, we expect our borrowings under debt financing arrangements to continue to increase. We also have material operating

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leases which expire over the next ten years as well as obligations for our debts. Total minimum contractual commitments due within the next 12 months were $1.0 billion as of December 31, 2023. Additionally, we have:

•operating leases that have not commenced with future minimum lease payments of $355 million with non-cancellable lease terms of 1 to 10 years;

•expected defined severance benefits to be paid of $889 million; and

•open purchase orders for inventories that are primarily due in the next twelve months, and are generally cancellable, in full or in part, through the contractual provisions.

Refer to Note 13 — "Commitments and Contingencies", Note 5 — "Defined Severance Benefits", and Note 10 — "Leases" in Part II, Item 8 - “Financial Statements and Supplementary Data” for disclosure of our future commitments.

Our short-term and long-term borrowings generally include lines of credit with financial institutions available to be drawn upon for general operating purposes.

Term Loan Facilities

In April 2023, we entered into a new three-year term loan facility agreement to borrow $178 million to finance the purchase of a fulfillment center and land. We pledged up to $214 million of certain land and buildings as collateral. The loan bears interest at a fixed rate of 6.76%.

Revolving Credit Agreement

We have a two-year Revolving Credit Agreement with a borrowing limit of $124 million that bears interest at the average of 91-days CD interest rate plus 2.30%. The revolving facility is secured by certain of our inventories.

Revolving Credit Facility

In January 2024, our senior unsecured credit facility (“the Revolving Credit Facility”) was amended to extend the maturity date to February 2026 and to bring the aggregate principal amount to $875 million. The Revolving Credit Facility continues to provide us the right to request incremental commitments up to $1.25 billion, subject to customary conditions.

Borrowings under the Revolving Credit Facility will bear interest, at our option, at a rate per annum equal to (i) a base rate equal to the highest of (A) the prime rate, (B) the higher of the federal funds rate or a composite overnight bank borrowing rate plus 0.50%, or (C) an adjusted Term Secured Overnight Funding Rate (“SOFR”) rate for a one-month interest period plus 1.00% or (ii) an adjusted Term SOFR plus a margin equal to 1.00%. We are also required to pay other customary fees for a credit facility of this size and type, including letter of credit fees, an upfront fee, and an unused commitment fee. The Revolving Credit Facility contains a number of covenants that, among other things, restrict our ability to:

•incur or guarantee additional debt;

•make certain investments and acquisitions;

•make certain restricted payments and payments of certain indebtedness;

•incur certain liens or permit them to exist; and

•make fundamental changes and dispositions (including dispositions of the equity interests of subsidiary guarantors).

Each of these restrictions is subject to various exceptions.

The Revolving Credit Facility is guaranteed on a senior unsecured basis by certain material restricted subsidiaries of Coupang, Inc. (including Coupang Corp.), subject to customary exceptions. The Revolving Credit Facility also contains certain customary affirmative covenants and events of default for facilities of this type.

The Revolving Credit Agreement and Revolving Credit Facility both require us to (i) maintain a ratio of secured indebtedness to total consolidated tangible assets of less than 35%, if we have $1 or more of revolving loans or any unreimbursed drawn letters of credit outstanding under the Revolving Credit Agreement or Revolving Credit Facility at the end of each fiscal quarter and (ii) maintain a minimum amount of liquidity of at least $625 million (or $313 million to the extent the aggregate commitment of the Revolving Credit Agreement or Revolving Credit Facility, respectively, is $500 million).

Refer to Note 12 — "Short-Term Borrowings and Long-Term Debt" in Part II, Item 8 - “Financial Statements and Supplementary Data” for disclosure of our debt obligations.

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In December 2023, we announced the pending acquisition of the business and assets of Farfetch, a leading global marketplace for the luxury fashion industry, which included a $500 million bridge loan to Farfetch and certain of its direct or indirect subsidiaries.

We established a limited partnership for the purposes of providing the bridge loan and acquiring all of the business and assets of Farfetch, owned 80.1% by Coupang, Inc and 19.9% by certain funds advised or managed by Greenoaks Capital Partners, LLC (“Greenoaks”). The limited partnership is included in the Company’s consolidated operating results as of December 31, 2023.

As of December 31, 2023, the limited partnership provided $75 million of financing under the bridge loan, and in January 2024, an additional $75 million was provided. Financings under the bridge loan, as well as capital contributions, are provided by the partners in accordance with their ownership percentages.

As announced on January 31, 2024, the acquisition was completed. At closing, the limited partnership provided additional cash funding to Farfetch of $150 million. Additionally, $150 million previously provided under the bridge loan was contributed towards the Farfetch Acquisition. The limited partnership is further obligated to fund Farfetch up to $200 million within twelve months of the acquisition date.

As part of the Farfetch Acquisition, a subsidiary of the limited partnership assumed the then outstanding syndicated Term Loans of $633 million, inclusive of fees incurred, under Farfetch’s existing Credit Agreement with certain banks and financial institutions. The Term Loans are payable on October 20, 2027, early repayment permitted. Repayment of the Term Loans is due in quarterly installments, of 0.25%, payable on the last business day of each fiscal quarter. The Term Loans bear interest at a rate equal to SOFR plus 6.25% per annum. Immediately following the acquisition, Farfetch repurchased $60 million of the outstanding Term Loan.

The Term Loans contain customary affirmative covenants as well as customary negative covenants, including, but not limited to, restrictions on certain entities within Farfetch’s ability to incur additional debt, make investments, make distributions, dispose of assets, or enter into certain types of related party transactions. The loans are secured against specified assets of the Farfetch group and guaranteed by certain subsidiaries of Farfetch.

Refer to Note 15 — " Subsequent Event - Farfetch" in Part II, Item 8 - “Financial Statements and Supplementary Data” for further discussion.