Sea Limited (SE -2.73%) has experienced struggles that its counterparts in other parts of the world have avoided. The Singapore-based company has become the Amazon of Southeast Asia even as the e-commerce conglomerate missed the recovery that benefited Amazon and its Latin American peer MercadoLibre.Unlike these competitors, Sea Limited operates a gaming division, which was its original business. The question for its long-term investors is whether any of these struggles will make a difference five years fro ...

Investment Rating - Buy (Maintained) [1] Core Views - The company's e-commerce platform, Shopee, demonstrated strong performance in Q4 2023, with revenue reaching $2.591 billion, a 23.2% YoY increase, surpassing consensus expectations [2] - The digital financial business underperformed in Q4 2023, with revenue of $470 million and adjusted EBITDA of $148 million, both below Bloomberg consensus [3] - The gaming business showed improvement in Q4 2023, with adjusted revenue of $456 million and adjusted EBITDA of $217 million, accounting for 47.6% of adjusted revenue [10] - The company achieved its first full-year profit since going public, with GAAP revenue of $13.06 billion and net income attributable to shareholders of $151 million in 2023 [9] Financial Forecasts and Valuation - Revenue is expected to grow from $13.064 billion in 2023 to $17.817 billion in 2026, with a CAGR of 10.9% [1] - Net income attributable to shareholders is projected to increase from $151 million in 2023 to $1.36 billion in 2026, with a CAGR of 108.5% [1] - Non-GAAP net income is forecasted to rise from $836 million in 2023 to $1.894 billion in 2026, with a CAGR of 31.4% [1] - EPS is expected to grow from $0.27 in 2023 to $2.41 in 2026, with a CAGR of 106.5% [1] E-commerce Business - Shopee's GMV grew 29% YoY in Q4 2023, driven by improved user experience and restrictions on TikTok in the Indonesian market [2] - The commission and advertising monetization rate increased by 0.2 percentage points QoQ to 7%, while the value-added service monetization rate decreased by 0.1 percentage points to 2.9% due to logistics subsidies [2] - Shopee's adjusted EBITDA loss narrowed to $225 million in Q4 2023, better than consensus expectations [2] Digital Financial Business - Revenue grew 24.3% YoY to $470 million in Q4 2023, but fell short of Bloomberg consensus [3] - Adjusted EBITDA increased to $148 million in Q4 2023 from $76 million in Q4 2022, but was below expectations [3] - The business is expected to maintain rapid growth in 2024, but profitability may be negatively impacted by increased marketing expenses [3] Gaming Business - Revenue was $510 million in Q4 2023, below consensus expectations [10] - Adjusted revenue improved QoQ to $456 million, with adjusted EBITDA of $217 million, representing 47.6% of adjusted revenue [10] - Free Fire's daily active users peaked at over 100 million in February 2024, and management expects double-digit YoY growth in user base and revenue in 2024 [10] Financial Ratios - ROE is projected to increase from 2.3% in 2023 to 13.3% in 2026 [15] - Gross margin is expected to rise from 44.7% in 2023 to 50.0% in 2026 [15] - Net profit margin is forecasted to grow from 1.2% in 2023 to 7.6% in 2026 [15] - The debt-to-asset ratio is expected to decline from 64.5% in 2023 to 58.2% in 2026 [15] Valuation Metrics - P/E ratio is projected to decrease from 151.75 in 2023 to 23.98 in 2026 [1] - P/S ratio is expected to decline from 1.75 in 2023 to 1.83 in 2026 [15] - EV/EBITDA is forecasted to drop from 36.73 in 2023 to 16.82 in 2026 [15]

Amazon started out in 1994 selling books online, and today, it dominates the entire e-commerce industry. However, the company has also expanded into other areas like streaming, digital advertising, and cloud computing.The stock has soared over the past decade, and while e-commerce remains the company's largest source of revenue, its other segments are making notable contributions to its profits and success.Sea Limited (SE -2.73%) bears a striking resemblance to Amazon in the latter's earlier days. It draws ...

Sea Limited (SE) reported a loss of 1 cent per share in fourth-quarter 2023, missing the Zacks Consensus Estimate of 2 cents per share. The company posted earnings of $1.25 per share in the year-ago quarter.Revenues of $3.6 billion increased 4.8% on a year-over-year basis. The consensus estimate was pegged at $3.59 billion.The company’s shares have gained 33.1% year to date compared with the Zacks Computer & Technology sector’s rise of 9.8%.Top-Line DetailsDigital entertainment revenues totaled $510.7 milli ...

MariBank, Singapore tech giant Sea Group's digital bank, has launched in Singapore to select members of the public as it rolls out its services progressively.Southeast Asian tech giant Sea Limited on Monday posted its first profitable year amid efforts to defend market share against Alibaba-owned Lazada and TikTok.Net income in 2023 was $162.7 million, as compared to a net loss of $1.7 billion in 2022. There was a net loss of $111.6 million in the fourth quarter of 2023, as compared to net income of $422.8 ...

Key TakeawaysSea Limited reported better-than-expected quarterly results on higher sales at its e-commerce and financial services businesses.The Singapore-based consumer internet provider also posted its first annual profit since it began publicly trading.ADRs of Sea Limited pared early gains and remained in negative territory over the past year. American Depositary Receipts (ADRs) of Sea Limited (SE) pared gained Monday after the Southeast Asian consumer internet company posted better-than-expected results ...

Shares of Sea Limited (SE 4.25%) popped then dropped on Monday after the company reported its results for 2023's fourth quarter before the market opened. It was a great quarter and year for the company, leading to enthusiasm from the market. But uncertainty regarding 2024 threw cold water on investors' initial fiery enthusiasm. Though it had been up by nearly 14% in early trading, it then fell, sinking to as low as down 2.5%. As of 12:40 p.m. ET, Sea stock was up by about 4.5%.A year of progressSea operates ...

Financial Data and Key Metrics Changes - Total GAAP revenue increased by 5% year-on-year to $3.6 billion in Q4 2023 and $13.1 billion for the full year of 2023, driven by improved monetization in e-commerce and digital financial services [90] - Total adjusted EBITDA was $127 million in Q4 2023, compared to $496 million in Q4 2022, while for the full year, adjusted EBITDA was $1.2 billion, a significant improvement from an adjusted EBITDA loss of $878 million in 2022 [91] - Cash position increased to $8.5 billion as of the end of 2023, reflecting disciplined investment strategies [72] Business Line Data and Key Metrics Changes - E-commerce Q4 GAAP revenue was $2.6 billion, with marketplace revenue up 23% year-on-year to $2.3 billion, and core marketplace revenue increased by 41% year-on-year to $1.6 billion [92] - Digital financial services GAAP revenue rose by 24% year-on-year to $472 million in Q4 and by 44% year-on-year to $1.8 billion for the full year [96] - Digital entertainment bookings were $456 million in Q4 and $1.8 billion for the full year, with adjusted EBITDA of $217 million in Q4 and $921 million for the full year [97] Market Data and Key Metrics Changes - Shopee's GMV and orders grew 29% and 46% year-on-year in Q4, respectively, indicating solid market share gains [77] - SeaMoney's consumer and SME loans principal outstanding reached $3.1 billion, a 27% increase year-on-year, with active users exceeding 16 million, a 28% increase year-on-year [84] Company Strategy and Development Direction - The company aims to maintain market share in 2024 with a focus on improving service quality, enhancing price competitiveness, and strengthening the content ecosystem for Shopee [74][75] - SeaMoney plans to invest in user acquisition for its credit business and expand digital banking and insurance services to capture future opportunities [85] - The company is focused on building a diverse portfolio in digital entertainment, with ongoing efforts to enhance user experiences and localize content [86][87] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving profitability in 2024, with expectations for Shopee's GMV growth in the high-teens range and adjusted EBITDA turning positive in the second half of the year [74][85] - The competitive landscape has stabilized, allowing the company to gain market share while improving unit economics [107][112] - Management highlighted the importance of maintaining a flexible leadership approach to sustain competitive advantages [12] Other Important Information - The company achieved its first full year of annual profit since its IPO in 2023, marking a significant milestone [63] - The logistics network has been expanded, with improvements in delivery speed and cost efficiency, contributing to a strong competitive moat [78][81] Q&A Session Summary Question: Insights on competition in the e-commerce space in Indonesia - Management acknowledged that the absence of TikTok during part of Q4 benefited their performance, but emphasized that growth trends continued into Q1 despite changing competitive dynamics [6][7] Question: Future cash allocation strategies - Management indicated a disciplined approach to maintaining a strong cash balance while exploring various options for cash deployment, including potential buybacks [9] Question: Anticipated competitor spending during Ramadan - Management noted that Ramadan has already begun in Indonesia and expressed confidence in their competitive positioning, emphasizing the importance of flexible leadership [12] Question: Confidence in Free Fire's growth - Management highlighted positive trends in user acquisition and monetization for Free Fire, expecting double-digit growth in both user base and bookings for 2024 [14][87] Question: Shopee's GMV growth expectations - Management provided a conservative guidance for Shopee's growth, citing market conditions and the need to maintain competitive advantages while focusing on efficient growth [18][19] Question: Live streaming unit economics - Management reported improvements in live streaming unit economics and noted that it has become a significant part of their order volume [35][80] Question: Broader game portfolio for Garena - Management clarified that Garena is not solely focused on Free Fire, as they have multiple titles across various genres and are actively expanding their game portfolio [46][47]

Sea Ltd (NYSE:SE) stock is up 1% to trade at $52.02 at last check, after the tech name recorded its first annual profit and issued a strong outlook for 2024. A fourth-quarter revenue win thanks to 24% year-over-year growth and smaller-than-expected losses are boosting the shares as well.While analysts are yet to chime in on the results, the options pits are already buzzing. So far today, 47,000 calls and 25,000 puts have crossed the tape, or seven times the intraday average volume. The most popular contract ...

For the quarter ended December 2023, Sea Limited Sponsored ADR (SE) reported revenue of $3.56 billion, up 16.9% over the same period last year. EPS came in at -$0.01, compared to $1.25 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $3.59 billion, representing a surprise of -0.66%. The company delivered an EPS surprise of -150.00%, with the consensus EPS estimate being $0.02.While investors scrutinize revenue and earnings changes year-over-year and how they compare w ...