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Sea’s (NYSE:SE) stock fell about 10% premarket on Tuesday after mixed third quarter results.
Net loss narrowed to about $143.99M, compared to net loss of $569.28M in the prior year period.
However, the Singapore-based tech giant, which operates e-commerce platform Shopee, had a net income of $331M in the second quarter of 2023.
Sea is facing strong competition from the likes of Alibaba’s (BABA) Lazada and ByteDance’s (BDNCE) TikTok as well as new entrants such as PDD (PDD) Temu. Sea’s Shopee — which operates across Southeast Asia, including Indonesia — and Jakarta-based GoTo’s Tokopedia are Indonesia’s online-shopping market leaders.
Until recently, TikTok Shop was gaining ground, when in September, Indonesia brought in a rule prohibiting social commerce companies from facilitating direct e-commerce payments on their platforms. ByteDance (BDNCE) has halted its e-commerce transactions in its TikTok Shop app in Indonesia but, reportedly in October, the company was thinking of applying for e-commerce licenses in the country.
Sea saw second quarter total revenue grow 4.9% year-over-year to $3.31B, surpassing analysts estimates.
“In this current period, we will prioritize investing in the business to increase our market share and further strengthen our market leadership,” said Sea’s Chairman and Group CEO Forrest Li. “Our move to self-sufficiency and profitability in the past quarters has significantly improved both our cash reserves and operational efficiency and we see a very good opportunity to build our e-commerce content ecosystem efficiently especially in live streaming.”
E-commerce and other services GAAP revenue soared 22.3% to $2.4B mainly due to improved monetization in the e-commerce business and growth of the credit business year-over-year.
E-commerce GAAP revenue rose 16.2% year-over-year to $2.2B.
Digital Entertainment’s GAAP revenue declined about 33.7% year-on-year to $592.2M, mainly attributable to moderation in user engagement and monetization year-on-year.
