Singapore Shopee-owner Sea tumbles amid signs of e-commerce slowdown, though Garena revenue up

Sea, Southeast Asia’s most valuable company, tumbled after reporting third-quarter financial results that showed signs of a slowdown in e-commerce growth.

The Singapore-based company’s revenue doubled to US$1.2 billion for the quarter and it boosted annual forecasts for two key businesses. But net losses also doubled to US$419.9 million and quarter-on-quarter growth in e-commerce gross merchandise value dropped to 16 per cent, from 29 per cent in the second quarter.

Sea shares slid 4.3 per cent in US trading. The stock is still up more than 300 per cent for the year.

“The results were disappointing,” said Nirgunan Tiruchelvam, head of consumer sector equity research at Tellimer. “This suggests that the market’s grand expectations of high growth in the e-commerce segment are misplaced.”

Sea has emerged as a stock-market sensation since its initial public offering in 2017, a wager the money-losing company can establish itself as a leader in e-commerce and gaming in Southeast Asia. Its shares have surged about 1,400 per cent since the start of 2019, pushing its market value to more than US$80 billion.

The rally has minted at least three billionaires at the company. CEO Forrest Li’s net worth is estimated at US$9.4 billion, according to the Bloomberg Billionaries Index.