Japan's one-time tech unicorn Mercari warns of more losses
07/02/2019 07:31
TOKYO, Feb 7 (Reuters) - Japanese e-commerce start-up
Mercari 4385.T , which went public last year with great
fanfare, booked a quarterly loss of 1.1 billion yen ($10
million) and warned of more losses ahead as it spends heavily to
expand in the U.S. market.
Mercari's smartphone app, which allows people to trade used
items online, is well known in Japan but has made only a small
headway in the U.S. market where it faces tough competition from
established sites such as eBay EBAY.O and Craigslist.
Mercari gave no specific forecast, but said heavy spending
on its overseas expansion could mean bigger losses ahead. The
company recently abandoned its push in Europe, but has not given
up in the United States, where it has recruited executives from
tech companies such as Facebook.
The company said it sold a total of 138.9 billion yen ($1.26
billion) worth of merchandise in the October-December quarter,
up 50 percent from the same period a year earlier.
But heavy sending on advertising and new businesses led to
an operating loss of 1.1 billion yen in the quarter, bigger than
its 463-million-yen loss a year earlier.
Mercari shares had surged to a high of 6,000 yen shortly
after going public in June in an IPO that raised over $1
billion, making it a rare tech unicorn. But they have fallen
over 60 percent since then, closing on Thursday at 2,322 yen
apiece.
($1 = 109.9200 yen)
(Reporting by Ritsuko Ando; Editing by Shreejay Sinha)
((Ritsuko.Ando@reuters.com; +81 3 6441 1743; Reuters Messaging:
ritsuko.ando.thomsonreuters.com@reuters.net))