Sea Limited Q2 2024 Earnings Summary $SE
Sea Limited reported Q2 2024 results that highlight a solid quarter with continued momentum from Q1. The CEO, Forrest Li, noted, "All three of our businesses have shown both strong growth and higher profitability." He emphasized that consumer spending trends remain healthy across Southeast Asia, strengthening the foundation for their e-commerce segment, Shopee.
Li mentioned, “We expect that Shopee will become adjusted EBITDA positive from the third quarter.” They revised their guidance for Shopee’s full-year GMV growth to the mid-20s, reflecting strong operational performance. Shopee has focused on enhancing competitiveness by improving pricing strategies, service quality, and ad take rates. They have observed more than a 20% increase in sellers paying for ads, driven by initiatives like the successful launch of Live Ads.
In the financial services realm, SeaMoney continues to grow its loan book while remaining prudent in risk management. CFO Tony Hou shared insights into this growth, noting that they registered over four million first-time borrowers in Q2, a number that has more than doubled year-on-year. The company has also expanded its off-Shopee credit use cases, partnering with over a thousand electronic stores in Indonesia.
Turning to digital entertainment, the performance of Garena's Free Fire game remains robust. Li stated, "Free Fire had more than 100 million daily active players," underlining the game’s ongoing popularity. He also expressed excitement about new game launches, including Need for Speed: Mobile, set to debut later this year.
While discussing the competitive landscape, Hou highlighted a more stable environment, especially in e-commerce, where take rates are expected to improve. He remarked, “We welcome the trend of more rational pricing strategies across the industry.”
In summary, Sea Limited's second-quarter results exhibit strong growth across all business segments, with positive projections moving forward. Investors can look forward to continued improvements and the potential for enhanced profitability as the company maneuvers through market dynamics. Li concluded with confidence in their strategy and the addition of new independent directors, emphasizing their commitment to innovation and growth in critical areas like AI and financial services.
