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Sea Group posts 160% gain in Q2 profits as net losses widen

Written by Stephanie Pearl Li Published on     2 mins read

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Despite robust growth, Sea reported net losses to the tune of USD 433.7 million in the second quarter, up 10.2% YoY.

Singapore-based conglomerate Sea Group posted USD 930.9 million in gross profits for the second quarter, registering a 363.5% year-on-year growth, according to the company’s financial results published on Tuesday. Despite the robust growth, the firm reported net losses of USD 433.7 million in the second quarter, up 10.2% from the same period in 2020.

The tech giant reported a 158.6% rise in revenue to USD 2.3 billion, up from USD 882 million in the same period a year ago, while the total EBITDA surged 213% from USD 7.7 million in 2020 to USD 24.1 million this year.

Sea Group’s money-making engine Garena, which develops some of the world’s most popular mobile games like battle royale title Free Fire, booked USD 1.2 billion in revenue, up 65% YoY, while its EBITDA increased by USD 741 million, up 70% from last year. The firm recorded 725 million quarterly active users, up 45% YoY, while the number of paid users jumped 85% YoY, reaching 92 million.

Shopee, Sea’s e-commerce arm, saw its GAAP revenue go up by 161% during Q2 to hit USD 1.2 billion as the firm expanded the scale and reach of its marketplace, thickening revenue from transaction-based fees, value-added services, and advertising.

The e-commerce subsidiary recorded a total of 1.4 billion gross orders in Q2, up 127% YoY, while its gross merchandise value reached USD 15 billion, up 88% YoY. “This deepening monetization was driven mainly by growing merchant investments in marketing and advertisement on the Shopee platform to better attract and serve buyers,” Sea Group’s CEO Forrest Li told investors during the earnings call.

Li added that Shopee was the top-ranked mobile app within its category across Southeast Asia and Taiwan in Q2. “In Indonesia, Shopee’s largest market, the e-commerce arm continued to dominate the local market with a triple-digit year-on-year growth when it comes to order numbers,” he said.

SeaMoney, Sea’s payments arm, recorded more than USD4.1 billion in total payment volume, up 150% YoY. It had over 32 million users during the second quarter.

“Even though SeaMoney is still at an early stage of development, the long-term addressable opportunity is highly significant. Consumers and small businesses in our markets are moving more of their consumption and commercial activities online, creating a greater need for the digital financial services that SeaMoney can offer,” Li said. “Moreover, we are encouraged to see the strong network effects of our mobile wallet helping to drive its acceptance and adoption across the region.”

Read this: Anger boils in Indonesia as Shopee allegedly underpays its couriers

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