Sea(US:SE) Guoxin Securities·2024-03-12 16:00Investment Rating - The investment rating for the company is "Buy" (maintained) [3][43]. Core Insights - The company's e-commerce business has shown significant revenue and profit performance due to an improved competitive landscape, with Q4 2023 e-commerce revenue reaching $2.6 billion, a year-on-year increase of 23% [1][7]. - The company achieved a total revenue of $3.6 billion in Q4 2023, reflecting a 5% year-on-year growth, primarily driven by e-commerce and digital financial services, partially offset by a decline in gaming revenue [5][42]. - The adjusted EBITDA for the e-commerce segment was -$230 million, with an EBITDA margin of -9% [1][52]. Summary by Sections E-commerce Business - Q4 2023 e-commerce revenue was $2.6 billion, up 23% year-on-year, with a notable 41% growth in core markets [1][7]. - The management anticipates Shopee to achieve a growth rate of 15%-20% in 2024 and aims for breakeven in the second half of the year [1][9]. Digital Financial Services - The digital financial segment generated $470 million in revenue in Q4 2023, a 24% increase year-on-year, mainly driven by credit services [12][16]. - Adjusted EBITDA for this segment was $150 million, with a profit margin of 31%, up from 20% in the same period last year [12][16]. Gaming Business - The gaming segment reported a GAAP revenue of $510 million in Q4 2023, a 46% decrease year-on-year, with a slight 2% increase in sequential revenue [48][56]. - The number of active users was 530 million, reflecting a 9% year-on-year increase, although the number of paying users decreased by 9% [48][56]. Financial Forecast and Valuation - The company has revised its revenue forecasts for 2024-2025 to $15.5 billion and $17.1 billion, respectively, with an increase of 5% for both years [43][63]. - The target price is set between $59 and $60, indicating an upside potential of 9%-11% [43][63].