Sea Ltd (SE) 2021 Q1 Financial Results Review

Sea Ltd (NYSE:SE) started in 2009 as an online gaming company. It generates most of its revenue from digital entertainment primarily through selling in-game items to players. Sea diversified over the years, stepping into several new segments. For instance, it started digital payments service AirPay in 2014, and online shopping platform Shopee in 2015. Today, Sea is a leading player in mobile gaming, e-commerce, online payments, and food delivery services in Southeast Asia and Latin America.

The Singapore-based company recently announced lower-than-expected financial results for the first quarter. Sea reported an adjusted loss of 82 cents per share for the quarter ended March 31, as compared to an adjusted loss of 61 cents per share in the same period of 2020. Analysts on average were looking for a loss of 53 cents per share.

Revenue for the quarter climbed 146 percent on a year-over-year basis to $1.76 billion but missed the consensus forecast of 1.84 billion. If we look at the performance of different segments, Digital Entertainment revenue jumped 111.4 percent to $781.3 million, fueled by the growth in Sea’s active user base. Comparatively, revenue from e-commerce and other services skyrocketed 189 percent to $772.4 million, mainly driven by the growth in the scale of its e-commerce marketplace.

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Sea also saw strong growth across its digital payments and financial services unit SeaMoney. The company said that its mobile wallet total payment volume (TPV) touched a record $3.4 billion in the latest quarter, translating to a surge of more than three folds from the year-ago quarter. Meanwhile, quarterly paying users across its mobile wallet services exceeded 26.1 million in the quarter.