Coupang swung to a loss despite higher sales in the second quarter, as its bottom-line results were impacted by fines related to the data breach in South Korea.

The e-commerce giant reported an attributable net loss of US$570 million for the quarter ended June 30, compared to a profit of $32 million a year ago. Last year’s operating income of $149 million was also replaced by an operating loss of $556 million.

A large part of the losses was attributable to the approximately $410 million penalty in relation to the massive data breach in South Korea that affected the personal data of more than 33 million customers.

The local privacy regulator said Coupang’s security system allowed the hacker, who was a former employee, to easily access the personal information of all of its customers. The firm also failed to detect an unusual increase in traffic to its customer data until it was alerted by a customer’s inquiry. 

Separately, the regulator found the company’s marketing program illegally collected information on online activities of around 11 million customers without their agreement.

Excluding the administrative fines, net loss for the period was $160 million and operating loss was $146 million.

Sales remained positive during the quarter, up 4 per cent on a reported basis and 10 per cent on a constant currency basis to $8.9 billion.

Product commerce segment’s revenues were $7.4 billion, up 1 per cent on a reported basis and 8 per cent on a constant currency basis. Active customers grew 3 per cent to 24.7 million.

Sales from the developing offerings segment rose 20 per cent on a reported basis and 24 per cent in constant currency.