Benzinga - by Anusuya Lahiri, Benzinga Editor.
Alibaba Group Holding Limited (NYSE:BABA), through its online platform AliExpress, has significantly increased its presence in South Korea, doubling its users to 8.58 million by April, according to Wiseapp.
Alibaba earmarked $1.1 billion for South Korea to build a new logistics center. This expansion comes amid fierce competition from domestic e-retailer Coupang, Inc (NYSE:CPNG), which is aggressively investing in advanced technologies and logistics to maintain its market share, taking a cue from Amazon.Com Inc (NASDAQ:AMZN).
Coupang reported a net loss of $24 million in the first quarter, its first in seven quarters. This loss was driven by substantial investments in AI-powered robots and a vast network of delivery drivers, the Nikkei Asia reports.
Alibaba’s net income plunged 86% to $453 million in the comparative quarter due to net loss from its investments in publicly traded companies during the quarter. Adjusted net income declined 11% Y/Y to $3.38 billion.
Coupang’s CEO, Kim Bom-suk, highlighted concerns over growing competition from Chinese e-commerce platforms offering low-priced products, such as AliExpress and PDD Holdings Inc (NASDAQ:PDD) Temu.
AliExpress’s strategy includes a $1.1 billion investment in a logistics hub and call center in South Korea, aiming to match Coupang’s quick delivery times.
Domestically, Coupang faces stiff competition from Naver, which holds a 20% market share compared to Coupang’s 22%.
To diversify, Coupang is exploring new opportunities in grocery and food delivery, areas where Chinese rivals struggle.
Price Actions: CPNG shares were trading higher by 0.34% at $23.31 premarket at the last check on Friday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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