ANN/THE STRAITS TIMES – Singapore-based Sea Ltd on Tuesday beat quarterly sales estimates and posted a smaller-than-expected quarterly loss, driven by strength in its core e-commerce as well as digital payments business.
Sea shares rose 13 per cent amid a rally in major United States (US)-listed Chinese technology stocks on hopes of Beijing easing its regulatory crackdown on the Internet sector.
Sea, which operates Shopee, SeaMoney and gaming unit Garena, said first-quarter e-commerce revenue grew 64.4 per cent.
After a meteoric run in 2020 and part of 2021, with multiple quarters of triple-digital revenue growth and expansion into newer markets including Mexico, Spain and South Korea, Sea’s growth tapered as the pandemic-fuelled boom in e-commerce and digital entertainment waned.
In the reported quarter, the company pulled out from India and France, while rising costs and supply chain issues added to its troubles, driving Sea shares 70 per cent lower this year.
“Shopee has continued to gain market share amid intense competitive pressure, although country re-openings across Asean are likely to drag on gaming and e-commerce segment earnings,” said analyst at research firm Third Bridge Kristine Lau.
Sea widened its full-year 2022 e-commerce revenue outlook range to between USD8.5 billion and USD9.1 billion from USD8.9 billion to USD9.1 billion forecast earlier.
“We still think the original guidance is achievable,” Chief Legal officer Yanjun Wang said on a post-earnings call, adding that Sea’s key Southeast Asian markets have so far been more resilient to Covid-19 outbreaks, while inflation has also been under control in the region.
First-quarter total revenue rose 64.4 per cent to USD2.90 billion, topping analysts’ expectations of USD2.76 billion, according to Refinitiv IBES data.
Net loss, however, widened to USD580.1 million from USD422.1 million. Excluding items, the company reported a loss per share of USD1.04, compared with analysts’ average estimate of a USD1.23 loss.