Shopee parent Sea books second consecutive year of profits, driven by strong e-commerce demand

SINGAPORE - Internet company Sea reported profits for a second consecutive year in 2024, buoyed by growth in its e-commerce and fintech units.

Shares of Sea, which is Singapore-based but listed in the US, closed up 7.14 per cent at US$132.31 on March 4 after it posted record earnings and revenue.

Profit came in at US$447.8 million (S$604.5 million) for the 12 months to Dec 31, 2024 – 175.2 per cent up on the US$162.7 million recorded in 2023. Revenue surged as well, rising 28.8 per cent to US$16.8 billion, compared with US$13.1 billion in the previous year. The group’s revenue for the fourth quarter of the 2024 financial year was US$5 billion, up 36.9 per cent year on year.

All of its business segments contributed to the bumper 2024 result, with e-commerce arm Shopee leading the charge, followed by financial services provider SeaMoney and gaming and digital unit Garena.

Chief executive Forrest Li told a results briefing on March 4 that the group expects all of its businesses to remain profitable and “self-sufficient” going forward. 

“This strong set of results validates our strategies: We made the right decisions, at the right time, and executed very well on them,” he said. 

Singapore-based Shopee saw a revenue jump of 37.9 per cent year on year to US$12.4 billion.

Adjusted earnings before interest, taxes, depreciation and amortisation (Ebitda) for the e-commerce unit was US$155.8 million for the 2024 financial year, compared with losses of US$213.8 million in 2023. 

Ebitda is adjusted to include unallocated expenses and helps to identify underlying trends in Sea’s operating results.

Gross orders on Shopee stood at 10.9 billion for the 12 months to Dec 31, 2024, up 33 per cent year on year. The platform’s gross merchandise value (GMV) rose 28 per cent year on year to US$100.5 billion. 

GMV refers to the total value of goods sold between customers or from e-commerce platforms. 

“We remain confident about our ability to continue delivering profitable growth in 2025, and expect Shopee’s full-year 2025 GMV growth to be around 20 per cent, with improving profitability,” said Mr Li. 

Mr Li also noted that Shopee is using artificial intelligence (AI) within its operations.

The platform provides its sellers with AI tools to enhance product listings by improving descriptions, images and videos. It has also used AI to boost its customer service capabilities, including upgrading its customer service chatbots with the technology. 

“We believe we are still early in the AI adoption curve, and remain committed to exploring AI-driven innovations to improve efficiency and deliver better experiences for our users,” said Mr Li. 

Meanwhile, SeaMoney, which offers users various digital financial products, including mobile wallet services and banking, reported a 34.6 per cent growth in revenue to US$2.4 billion for the 2024 financial year. 

“While we have scaled fast, risk management remains our top operational priority... In 2025, we expect loan book size to grow meaningfully faster than Shopee’s GMV annual growth rate, as we improve credit penetration both on and off Shopee,” said Mr Li. 

Garena was a drag on overall growth, with the business seeing a drop in revenue in 2024 compared with 2023. But cash spent by users of the gaming and digital platform rose 18.7 per cent year on year to US$2.1 billion.

Mr Li said that Garena will continue scaling its user base and broadening its content offerings. 

“We now expect Garena to grow double digits year on year, for both user base and bookings in 2025,” he said. 

DBS Group research analyst Sachin Mittal said Shopee is expected to generate a 20 per cent growth in GMV in 2025.

The platform’s profitability is also forecast to climb 14 per cent for the 2025 financial year, he added. 

Ms Helena Wang, analyst at Phillips Securities Research, said that while Sea has achieved “impressive growth” in 2024, the company’s share price has been on an upward trajectory for several quarters, climbing 145 per cent in the past year. 

“With much of the positive news likely already priced in, we see limited upside potential from current levels,” she said.