Japanese e-commerce start-up Mercari, 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 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.