NYSE-listed Sea Limited, one of Singapore’s biggest tech firms, fell 3.5% early this week after releasing mixed earnings for the third quarter of 2021.
According to the firm, costs for the quarter mostly come from higher operating expenses, with sales and marketing accounting for two-thirds of total expenditures amounting to $1.5 billion (105% higher than last year).
The firm, which owns e-commerce giant Shopee, gaming developer Garena, and financial services platform SeaMoney, posted a net loss of $450.1 million attributed to ordinary shareholders. The company’s net loss increased from $340.8 million.
The company booked sales of $2.7 billion, but it lost $0.84 per share during the quarter. Analysts predicted that Sea Limited would lose $0.65 per share on less than $2.5 billion in sales for the period.
E-commerce was a bright spot, increasing by 134.4% year-over-year to $1.5 billion. As such, Sea Limited raised its full-year guidance for the second time. The firm predicts e-commerce sales to be between US$5 billion and US$5.2 billion, up from the previous year’s estimates of $4.7 billion and $ 4.9 billion.
“Shopee’s swift merchandising strategy and aggressive campaigns have reinforced its leading positioning. Its expansion into other seller services such as advertising and Shopee Express also contribute towards steady growth in both first-party and third-party seller take rate expansion,” said Kristine Lau, an analyst at research house Third Bridge.
Following Sea Limited’s earnings report on Tuesday, the organization named Chris Feng as group president beginning January 1, 2022. According to the Business Times, Feng’s leadership and innovation helped make Shopee a major e-commerce player in Southeast Asia. He will continue to lead Shopee and SeaMoney as CEO.
Another positive segment for Sea Limited is gaming. According to Nasdaq, Garena’s Free Fire has garnered enough attention to become the third most downloaded mobile game worldwide in August and September of this year.
Amidst Sea Limited’s achievements in e-commerce and gaming, Billy Duberstein of Motley Fool said that the firm may not be profitable today, but investors should keep an eye out as “under-the-hood indicators point to a very different future.”