New York-listed Sea Ltd. has posted a net loss of $931 million for the second quarter ended June 30, 2022, more than doubling from $433.7 million a year ago.

The losses widened even as e-commerce division Shopee’s unit economics “improved significantly”, CEO and chairman Forrest Li said on Tuesday.

The losses included a $177.3 million impairment related to prior acquisitions, owing to lower current market valuations, and share-based compensation, the company said.

During the three months, the e-commerce and gaming giant recorded GAAP revenues of $2.9 billion, up 29% from the year before.

Source: Sea Ltd. EC stands for E-commerce, DE is Digital Entertainment, while DFS stands for Digital Financial Services as per company’s nomenclature.

E-commerce revenue for the quarter was up 51% from the year before at $1.7 billion, driven by marketplace revenue. (See chart above)

Adjusted losses before interest, tax, depreciation and amortisation (EBITDA) for Shopee was $648 million, compared with losses of $580 million in the same period last year. However, adjusted losses per order narrowed by 21% to 33 cents, compared to 41 cents previously.

The best-performing markets for Shopee were Southeast Asia and Taiwan, where adjusted losses came to less than 1 cent per order during the period.

Going forward, the company said it expects overall e-commerce activity to slow, following significant growth during pandemic restrictions.

Shopee’s Gross Orders and GMV grow in Q2

Source: Sea Ltd

Sea’s financial services unit posted stellar growth during the second quarter, with revenues of $279 million, up more than 200% from the year before. (See chart above) Adjusted EBITDA losses for the business improved to $111.5 million, from $155 million a year ago.

Quarterly active users across SeaMoney products and services grew 53% from the year before to 52.7 million. The company noted that nearly 40% of Shopee users in Southeast Asia have used SeaMoney. Total payment volumes for the mobile wallet hit $5.7 billion in April-June 2022, or 36% up from the year before.

Revenue shrinks at Garena

Meanwhile, Sea’s gaming unit Garena recorded $900.3 million in GAAP revenue in the quarter, down from over $1 billion a year ago.

Bookings, or the company’s gauge of cash spent by users during the period, fell from $1.2 billion a year ago, to $717.4 million. Quarterly active users were also about 15% down, to under 620 million.

Fall in users at Garena

Ses Ltd said it is suspending e-commerce GAAP revenue guidance for the 2022 financial year. “In our efforts to adapt to increasing macro uncertainties, we are proactively shifting our strategies to further focus on efficiency and optimisation for the long-term strength and profitability of the e-commerce business.”

Shares of Sea Ltd., which have fallen around 60% so far this year, were trading at $89.97 apiece on Tuesday morning on NYSE, up 1.42%.

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