Sea Limited Reports Fourth Quarter and Full Year 2023 Results
“I am happy to share that we have achieved our first full year of annual profit since our IPO,” said
“Despite an environment of intensified competition in
“For SeaMoney, 2023 was the first year of positive profit, primarily attributed to our consumer and SME credit business. In 2024, we will continue to invest in user acquisition for our credit business, both on and off Shopee platform as we see significant upside in our markets. As we scale, we will remain prudent on risk management.”
“For Garena, I am happy to share that we are seeing improved user acquisition and retention trends for Free Fire. In 2023, Free Fire was the most downloaded mobile game globally according to
“We are pleased to see positive trends in both growth and profitability for all three of our businesses. Looking ahead, we will continue to invest for the future with discipline and focus.”
Fourth Quarter 2023 Highlights
-
Group
-
Total GAAP revenue was
US$3.6 billion , up 4.8% year-on-year. -
Total gross profit was
US$1.5 billion , as compared to total gross profit ofUS$1.7 billion for the fourth quarter of 2022. -
Total net loss was
US$(111.6) million , as compared to total net income ofUS$422.8 million for the fourth quarter of 2022. -
Total adjusted EBITDA1 was
US$126.7 million , as compared toUS$495.7 million for the fourth quarter of 2022. -
As of
December 31, 2023 , cash, cash equivalents, short-term and other treasury investments2 wereUS$8.5 billion , representing a net increase3 ofUS$565.7 million fromSeptember 30, 2023 .
-
Total GAAP revenue was
-
E-commerce
-
GAAP revenue was
US$2.6 billion , up 23.2% year-on-year. -
GAAP revenue included
US$2.3 billion of GAAP marketplace revenue, which consists of core marketplace revenue and value-added services revenue and increased by 23.2% year-on-year.-
Core marketplace revenue, mainly consisting of transaction-based fees and advertising revenues, was up 40.6% year-on-year to
US$1.6 billion as a result of platform growth and improved monetization. -
Value-added services revenue, mainly consisting of revenues related to logistics services, was down 5.3% year-on-year to
US$657.9 million as a result of higher revenue net-off against shipping subsidies.
-
Core marketplace revenue, mainly consisting of transaction-based fees and advertising revenues, was up 40.6% year-on-year to
-
Adjusted EBITDA1 was
US$(225.3) million , as compared toUS$196.1 million for the fourth quarter of 2022 andUS$(346.5) million for the third quarter of 2023. Adjusted EBITDA improved meaningfully quarter-on-quarter for bothAsia and Other markets.Asia markets recorded adjusted EBITDA ofUS$(192.9) million in the quarter, as compared toUS$320.0 million for the fourth quarter of 2022 andUS$(306.2) million for the third quarter of 2023.-
Other markets recorded adjusted EBITDA of
US$(32.4) million in the quarter, as compared toUS$(123.9) million for the fourth quarter of 2022 andUS$(40.3) million for the third quarter of 2023. -
In
Brazil , unit economics continued to improve, with contribution margin4 loss per order improving 88.9% year-on-year toUS$(0.05) for the quarter.
- Gross orders totaled 2.5 billion for the quarter, increasing by 46.0% year-on-year and 13.4% quarter-on-quarter.
-
GMV was
US$23.1 billion for the quarter, increasing by 28.6% year-on-year and 15.3% quarter-on-quarter.
-
GAAP revenue was
-
Digital Financial Services -
GAAP revenue was
US$472.4 million , up 24.3% year-on-year. -
Adjusted EBITDA1 was
US$148.5 million , up 96.4% year-on-year. -
Digital financial services revenue and operating income are primarily attributed to the consumer and SME credit business. As of
December 31, 2023 , consumer and SME loans principal outstanding wasUS$3.1 billion , up 27.0% year-on-year. This consists ofUS$2.5 billion on-book andUS$0.6 billion off-book loans principal outstanding5. -
Non-performing loans past due by more than 90 days as a percentage of consumer and SME loans on-book was 1.6%, stable quarter-on-quarter.
-
GAAP revenue was
-
Digital Entertainment -
GAAP revenue was
US$510.8 million , as compared toUS$592.2 million for the previous quarter. -
Bookings6 were
US$456.3 million , up 1.9% quarter-on-quarter. -
Adjusted EBITDA1 was
US$217.4 million , as compared toUS$234.0 million for the previous quarter. - Adjusted EBITDA represented 47.6% of bookings for the fourth quarter of 2023, as compared to 52.2% for the previous quarter.
- Quarterly active users were 528.7 million, as compared to 544.1 million for the previous quarter.
- Quarterly paying users were 39.7 million, as compared to 40.5 million for the previous quarter. Paying user ratio was 7.5%, remaining stable quarter-on-quarter.
-
Average bookings per user were
US$0.86 , up 4.8% quarter-on-quarter.
-
GAAP revenue was
Full Year 2023 Highlights
-
Group
-
Total GAAP revenue was
US$13.1 billion , up 4.9% year-on-year. -
Total gross profit was
US$5.8 billion , up 12.5% year-on-year. -
Total net income was
US$162.7 million , as compared to total net loss ofUS$(1.7) billion for the full year of 2022. -
Total adjusted EBITDA1 was
US$1.2 billion , as compared toUS$(878.1) million for the full year of 2022.
-
Total GAAP revenue was
-
E-commerce
-
GAAP revenue was
US$9.0 billion , up 23.5% year-on-year. -
GAAP revenue included
US$7.9 billion of GAAP marketplace revenue, up 27.4% year-on-year. -
Adjusted EBITDA1 was
US$(213.8) million , as compared toUS$(1.7) billion for the full year of 2022. - Gross orders totaled 8.2 billion, up 8.8% year-on-year.
-
GMV was
US$78.5 billion , up 6.8% year-on-year.
-
GAAP revenue was
-
Digital Financial Services -
GAAP revenue was
US$1.8 billion , up 44.0% year-on-year. -
Adjusted EBITDA1 was
US$550.1 million , as compared toUS$(228.6) million for the full year of 2022.
-
GAAP revenue was
-
Digital Entertainment -
GAAP revenue was
US$2.2 billion , as compared toUS$3.9 billion for the full year of 2022. -
Bookings6 were
US$1.8 billion , as compared toUS$2.8 billion for the full year of 2022. -
Adjusted EBITDA1 was
US$920.9 million , as compared toUS$1.3 billion for the full year of 2022. -
Adjusted EBITDA represented 50.9% of bookings for the full year of 2023, as compared to 47.7% for the full year of 2022.
-
GAAP revenue was
1 |
For a discussion of the use of non-GAAP financial measures, see “Non-GAAP Financial Measures”. |
|
2 |
Other treasury investments currently consist of group treasury related investments, such as available-for-sale sovereign bonds and corporate bonds, classified as part of long-term investments. |
|
3 |
Includes proceeds of approximately |
|
4 |
Contribution margin refers to adjusted EBITDA before allocation of HQ costs. |
|
5 |
Off-book loans principal outstanding mainly refers to channeling arrangements, which is lending by other financial institutions on our platform. |
|
6 |
GAAP revenue for the digital entertainment segment plus change in digital entertainment deferred revenue. This operating metric is used as an approximation of cash spent by our users in the applicable period that is attributable to our digital entertainment segment. |
Unaudited Summary of Financial Results |
||||||||||||||||||
(Amounts are expressed in thousands of US dollars “$” except for per share data) |
||||||||||||||||||
|
For the Three Months
|
|
For the Full Year
|
|
||||||||||||||
|
2022 |
2023 |
|
2022 |
2023 |
|
||||||||||||
|
$ |
$ |
YOY% |
$ |
$ |
YOY% |
||||||||||||
Revenue |
|
|
|
|
|
|
||||||||||||
Service revenue |
|
|
|
|
|
|
||||||||||||
|
948,857 |
|
510,773 |
|
(46.2 |
)% |
3,877,163 |
|
2,172,009 |
|
(44.0 |
)% |
||||||
E-commerce and other services |
2,231,133 |
|
2,771,267 |
|
24.2 |
% |
7,463,173 |
|
9,770,376 |
|
30.9 |
% |
||||||
Sales of goods |
271,594 |
|
334,588 |
|
23.2 |
% |
1,109,369 |
|
1,121,175 |
|
1.1 |
% |
||||||
|
3,451,584 |
|
3,616,628 |
|
4.8 |
% |
12,449,705 |
|
13,063,560 |
|
4.9 |
% |
||||||
|
|
|
|
|
|
|
||||||||||||
Cost of revenue |
|
|
|
|
|
|
||||||||||||
Cost of service |
|
|
|
|
|
|
||||||||||||
|
(242,470 |
) |
(161,360 |
) |
(33.5 |
)% |
(1,077,017 |
) |
(672,481 |
) |
(37.6 |
)% |
||||||
E-commerce and other services |
(1,282,174 |
) |
(1,621,218 |
) |
26.4 |
% |
(5,194,065 |
) |
(5,530,043 |
) |
6.5 |
% |
||||||
Cost of goods sold |
(229,627 |
) |
(309,263 |
) |
34.7 |
% |
(993,346 |
) |
(1,027,389 |
) |
3.4 |
% |
||||||
|
(1,754,271 |
) |
(2,091,841 |
) |
19.2 |
% |
(7,264,428 |
) |
(7,229,913 |
) |
(0.5 |
)% |
||||||
Gross profit |
1,697,313 |
|
1,524,787 |
|
(10.2 |
)% |
5,185,277 |
|
5,833,647 |
|
12.5 |
% |
||||||
Other operating income |
68,453 |
|
58,524 |
|
(14.5 |
)% |
279,184 |
|
221,021 |
|
(20.8 |
)% |
||||||
Sales and marketing expenses |
(473,620 |
) |
(967,433 |
) |
104.3 |
% |
(3,269,223 |
) |
(2,779,223 |
) |
(15.0 |
)% |
||||||
General and administrative expenses |
(352,321 |
) |
(232,603 |
) |
(34.0 |
)% |
(1,437,612 |
) |
(1,134,724 |
) |
(21.1 |
)% |
||||||
Provision for credit losses |
(175,103 |
) |
(159,988 |
) |
(8.6 |
)% |
(513,690 |
) |
(633,942 |
) |
23.4 |
% |
||||||
Research and development expenses |
(244,195 |
) |
(279,806 |
) |
14.6 |
% |
(1,376,501 |
) |
(1,164,126 |
) |
(15.4 |
)% |
||||||
Impairment of goodwill |
(177,663 |
) |
- |
|
- |
|
(354,943 |
) |
(117,875 |
) |
(66.8 |
)% |
||||||
Total operating expenses |
(1,354,449 |
) |
(1,581,306 |
) |
16.7 |
% |
(6,672,785 |
) |
(5,608,869 |
) |
(15.9 |
)% |
||||||
Operating income (loss) |
342,864 |
|
(56,519 |
) |
(116.5 |
)% |
(1,487,508 |
) |
224,778 |
|
(115.1 |
)% |
||||||
Non-operating income (loss), net |
34,973 |
|
31,654 |
|
(9.5 |
)% |
(13,025 |
) |
207,616 |
|
(1,694.0 |
)% |
||||||
Income tax credit (expense) |
43,461 |
|
(76,894 |
) |
(276.9 |
)% |
(168,395 |
) |
(262,680 |
) |
56.0 |
% |
||||||
Share of results of equity investees |
1,540 |
|
(9,856 |
) |
(740.0 |
)% |
11,156 |
|
(7,032 |
) |
(163.0 |
)% |
||||||
Net income (loss) |
422,838 |
|
(111,615 |
) |
(126.4 |
)% |
(1,657,772 |
) |
162,682 |
|
(109.8 |
)% |
||||||
|
|
|
|
|
|
|
||||||||||||
Earnings (Loss) per share attributable to
Basic |
0.76 |
|
(0.19 |
) |
(125.0 |
)% |
(2.96 |
) |
0.27 |
|
(109.1 |
)% |
||||||
Diluted |
0.72 |
|
(0.19 |
) |
(126.4 |
)% |
(2.96 |
) |
0.25 |
|
(108.4 |
)% |
||||||
|
|
|
|
|
|
|
||||||||||||
Change in deferred revenue of
|
(405,262 |
) |
(54,459 |
) |
(86.6 |
)% |
(1,125,294 |
) |
(362,397 |
) |
(67.8 |
)% |
||||||
|
|
|
|
|
|
|
||||||||||||
Adjusted EBITDA for Digital Entertainment (1) |
258,233 |
|
217,411 |
|
(15.8 |
)% |
1,313,091 |
|
920,923 |
|
(29.9 |
)% |
||||||
Adjusted EBITDA for E-commerce (1) |
196,146 |
|
(225,332 |
) |
(214.9 |
)% |
(1,690,554 |
) |
(213,774 |
) |
(87.4 |
)% |
||||||
Adjusted EBITDA for Digital Financial Services (1) |
75,601 |
|
148,482 |
|
96.4 |
% |
(228,560 |
) |
550,112 |
|
(340.7 |
)% |
||||||
Adjusted EBITDA for Other Services (1) |
(25,437 |
) |
(6,979 |
) |
(72.6 |
)% |
(239,149 |
) |
(44,880 |
) |
(81.2 |
)% |
||||||
Unallocated expenses (2) |
(8,887 |
) |
(6,877 |
) |
(22.6 |
)% |
(32,962 |
) |
(33,199 |
) |
0.7 |
% |
||||||
Total adjusted EBITDA (1) |
495,656 |
|
126,705 |
|
(74.4 |
)% |
(878,134 |
) |
1,179,182 |
|
(234.3 |
)% |
(1) |
For a discussion of the use of non-GAAP financial measures, see “Non-GAAP Financial Measures”. |
|
(2) |
Unallocated expenses within total adjusted EBITDA are mainly related to general and corporate administrative costs such as professional fees and other miscellaneous items that are not allocated to segments. These expenses are excluded from segment results as they are not reviewed by the Chief Operating Decision Maker (“CODM”) as part of segment performance. |
Three Months Ended
Revenue
Our total GAAP revenue increased by 4.8% to
-
Digital Entertainment : GAAP revenue wasUS$510.8 million compared toUS$948.9 million in the fourth quarter of 2022, primarily attributable to moderation in user monetization year-on-year. -
E-commerce and other services: GAAP revenue increased by 24.2% to
US$2.8 billion in the fourth quarter of 2023 fromUS$2.2 billion in the fourth quarter of 2022, primarily driven by the GMV growth of our e-commerce business and the growth of our credit business year-on-year. -
Sales of goods: GAAP revenue increased by 23.2% to
US$334.6 million in the fourth quarter of 2023 fromUS$271.6 million in the fourth quarter of 2022.
Cost of Revenue
Our total cost of revenue was
-
Digital Entertainment : Cost of revenue decreased by 33.5% toUS$161.4 million in the fourth quarter of 2023 fromUS$242.5 million in the fourth quarter of 2022. -
E-commerce and other services: Cost of revenue for e-commerce and other services segment combined was
US$1.6 billion in the fourth quarter of 2023, as compared toUS$1.3 billion in the fourth quarter of 2022, primarily driven by higher costs of logistics from order growth. -
Cost of goods sold: Cost of goods sold increased by 34.7% to
US$309.3 million in the fourth quarter of 2023 fromUS$229.6 million in the fourth quarter of 2022.
Other Operating Income
Other operating income was
Sales and Marketing Expenses
Our total sales and marketing expenses increased by 104.3% to
|
For the Three Months
|
|
||||
|
2022 |
|
2023 |
YOY% |
||
Sales and Marketing Expenses |
$ |
|
$ |
|
||
|
43,262 |
|
29,926 |
(30.8 |
)% |
|
E-commerce |
379,369 |
|
878,985 |
131.7 |
% |
|
|
29,918 |
|
51,927 |
73.6 |
% |
General and Administrative Expenses
Our general and administrative expenses decreased by 34.0% to
Provision for Credit Losses
Our provision for credit losses decreased by 8.6% to
Research and Development Expenses
Our research and development expenses increased by 14.6% to
Impairment of
We recorded nil impairment of goodwill in the fourth quarter of 2023, compared to
Non-operating Income or Losses, Net
Non-operating income or losses mainly consist of interest income, interest expense, investment gain (loss), foreign exchange gain (loss) and gain (loss) on debt extinguishment. We recorded a net non-operating income of
We recognized a gain on debt extinguishment of
Income Tax Expenses or Credit
We had a net income tax expense of
Net Loss or Income
As a result of the foregoing, we had net loss of
Basic and Diluted Loss or Earnings Per Share Attributable to Sea Limited’s Ordinary Shareholders
Basic loss per share attributable to Sea Limited’s ordinary shareholders was
Diluted loss per share attributable to Sea Limited’s ordinary shareholders was
Full Year Ended
Revenue
Our total GAAP revenue increased by 4.9% to
-
Digital Entertainment : GAAP revenue wasUS$2.2 billion for the full year endedDecember 31, 2023 fromUS$3.9 billion for the full year endedDecember 31, 2022 , primarily attributable to the moderation in user engagement and monetization. -
E-commerce and other services: GAAP revenue increased by 30.9% to
US$9.8 billion for the full year endedDecember 31, 2023 fromUS$7.5 billion for the full year endedDecember 31, 2022 , primarily driven by the improved monetization in our e-commerce business and the growth of our credit business. -
Sales of goods: GAAP revenue was
US$1.1 billion for the full year endedDecember 31, 2023 , relatively stable year-on-year.
Cost of Revenue
Our total cost of revenue was
-
Digital Entertainment : Cost of revenue decreased by 37.6% toUS$672.5 million for the full year endedDecember 31, 2023 fromUS$1.1 billion for the full year endedDecember 31, 2022 . -
E-commerce and other services: Cost of revenue for our e-commerce and other services segment combined increased by 6.5% to
US$5.5 billion for the full year endedDecember 31, 2023 fromUS$5.2 billion for the full year endedDecember 31, 2022 , primarily driven by higher costs of logistics from order growth. -
Cost of goods sold: Cost of goods sold was
US$1.0 billion for the full year endedDecember 31, 2023 .
Other Operating Income
Our other operating income was
Sales and Marketing Expenses
Our total sales and marketing expenses decreased by 15.0% to
|
For the Full Year
|
|
||||
|
2022 |
|
2023 |
YOY% |
||
Sales and Marketing Expenses |
$ |
|
$ |
|
||
|
268,061 |
|
104,721 |
(60.9 |
)% |
|
E-commerce |
2,328,636 |
|
2,510,693 |
7.8 |
% |
|
|
508,089 |
|
116,445 |
(77.1 |
)% |
General and Administrative Expenses
Our general and administrative expenses decreased by 21.1% to
Provision for Credit Losses
Our provision for credit losses increased by 23.4% to
Research and Development Expenses
Our research and development expenses decreased by 15.4% to
Impairment of
We recorded an impairment of goodwill of
Non-operating Income or Losses, Net
Non-operating income or losses mainly consist of interest income, interest expense, investment gain (loss), and foreign exchange gain (loss), and gain (loss) on debt extinguishment. We recorded a net non-operating income of
Income Tax Expense
We had a net income tax expense of
Net Income or Loss
As a result of the foregoing, we had net income of
Basic and Diluted Earnings or Loss Per Share Attributable to Sea Limited’s Ordinary Shareholders
Basic earnings per share attributable to Sea Limited’s ordinary shareholders was
Diluted earnings per share attributable to Sea Limited’s ordinary shareholders was
Webcast and Conference Call Information
The Company’s management will host a conference call today to review Sea’s business and financial performance.
Details of the conference call and webcast are as follows:
Date and time: |
|
|
Webcast link: |
A replay of the conference call will be available at the Company’s investor relations website (www.sea.com/investor/home). An archived webcast will be available at the same link above.
About
Forward-Looking Statements
This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the
Non-GAAP Financial Measures
To supplement our consolidated financial statements, which are prepared and presented in accordance with
- “Adjusted EBITDA” for our digital entertainment segment represents operating income (loss) before impairment of goodwill plus (a) depreciation and amortization expenses, and (b) the net effect of changes in deferred revenue and its related cost for our digital entertainment segment. We believe that the segment adjusted EBITDA helps to identify underlying trends in our operating results, enhancing their understanding of the past performance and future prospects.
- “Adjusted EBITDA” for our e-commerce segment, digital financial services segment and other services segment represents operating income (loss) plus depreciation and amortization expenses. We believe that the segment adjusted EBITDA helps to identify underlying trends in our operating results, enhancing their understanding of the past performance and future prospects.
- “Total adjusted EBITDA” represents the sum of adjusted EBITDA of all our segments combined, plus unallocated expenses. We believe that the total adjusted EBITDA helps to identify underlying trends in our operating results, enhancing their understanding of the past performance and future prospects.
These non-GAAP financial measures have limitations as analytical tools. None of the above financial measures should be considered in isolation or construed as an alternative to revenue, net loss/income, or any other measure of performance or as an indicator of our operating performance. These non-GAAP financial measures presented here may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to Sea’s data. We compensate for these limitations by reconciling the non-GAAP financial measures to their nearest
The tables below present selected financial information of our reporting segments, the non-GAAP financial measures that are most directly comparable to GAAP financial measures, and the related reconciliations between the financial measures. Amounts are expressed in thousands of US dollars (“$”) except for number of shares & per share data.
|
For the Three Months ended |
||||||||||||||||
|
Digital
|
E-
|
Digital
|
Other
|
Unallocated
|
Consolidated |
|||||||||||
|
$ |
$ |
$ |
$ |
$ |
$ |
|||||||||||
Operating income (loss) |
261,060 |
|
(303,681 |
) |
134,205 |
(9,558 |
) |
(138,545 |
) |
(56,519 |
) |
||||||
Net effect of changes in deferred
|
(49,925 |
) |
- |
|
- |
- |
|
- |
|
(49,925 |
) |
||||||
Depreciation and Amortization |
6,276 |
|
78,349 |
|
14,277 |
2,579 |
|
- |
|
101,481 |
|
||||||
Share-based compensation |
- |
|
- |
|
- |
- |
|
131,668 |
|
131,668 |
|
||||||
Adjusted EBITDA |
217,411 |
|
(225,332 |
) |
148,482 |
(6,979 |
) |
(6,877 |
) |
126,705 |
|
||||||
|
|||||||||||||||||
|
For the Three Months ended |
||||||||||||||||
|
Digital
|
E-
|
Digital
|
Other
|
Unallocated
|
Consolidated |
|||||||||||
|
$ |
$ |
$ |
$ |
$ |
$ |
|||||||||||
Operating income (loss) |
400,165 |
|
109,486 |
|
61,841 |
(28,714 |
) |
(199,914 |
) |
342,864 |
|
||||||
Net effect of changes in deferred
|
(331,321 |
) |
- |
|
- |
- |
|
- |
|
(331,321 |
) |
||||||
Depreciation and Amortization |
11,726 |
|
86,660 |
|
13,760 |
3,277 |
|
- |
|
115,423 |
|
||||||
Share-based compensation |
- |
|
- |
|
- |
- |
|
191,027 |
|
191,027 |
|
||||||
Impairment of goodwill |
177,663 |
|
- |
|
- |
- |
|
- |
|
177,663 |
|
||||||
Adjusted EBITDA |
258,233 |
|
196,146 |
|
75,601 |
(25,437 |
) |
(8,887 |
) |
495,656 |
|
(1) |
A combination of multiple business activities that does not meet the quantitative thresholds to qualify as reportable segments are grouped together as “Other Services”. |
|
(2) |
Unallocated expenses are mainly related to share-based compensation, impairment of goodwill of prior acquisitions that are not under our reportable segments, and general and corporate administrative costs such as professional fees and other miscellaneous items that are not allocated to segments. These expenses are excluded from segment results as they are not reviewed by the CODM as part of segment performance. |
|
For the Full Year ended |
|||||||||||||||||
|
Digital
|
E-
|
Digital
|
Other
|
Unallocated
|
Consolidated |
||||||||||||
|
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||
Operating income (loss) |
1,177,871 |
|
(550,470 |
) |
490,209 |
|
(56,728 |
) |
(836,104 |
) |
224,778 |
|
||||||
Net effect of changes in deferred
|
(289,346 |
) |
- |
|
- |
|
- |
|
- |
|
(289,346 |
) |
||||||
Depreciation and Amortization |
32,398 |
|
336,696 |
|
59,903 |
|
11,848 |
|
- |
|
440,845 |
|
||||||
Share-based compensation |
- |
|
- |
|
- |
|
- |
|
685,030 |
|
685,030 |
|
||||||
Impairment of goodwill |
- |
|
- |
|
- |
|
- |
|
117,875 |
|
117,875 |
|
||||||
Adjusted EBITDA |
920,923 |
|
(213,774 |
) |
550,112 |
|
(44,880 |
) |
(33,199 |
) |
1,179,182 |
|
||||||
|
||||||||||||||||||
|
For the Full Year ended |
|||||||||||||||||
|
Digital
|
E-
|
Digital
|
Other
|
Unallocated
|
Consolidated |
||||||||||||
|
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||
Operating income (loss) |
1,971,416 |
|
(2,013,360 |
) |
(277,264 |
) |
(252,162 |
) |
(916,138 |
) |
(1,487,508 |
) |
||||||
Net effect of changes in deferred
|
(879,809 |
) |
- |
|
- |
|
- |
|
- |
|
(879,809 |
) |
||||||
Depreciation and Amortization |
43,821 |
|
322,806 |
|
48,704 |
|
13,013 |
|
- |
|
428,344 |
|
||||||
Share-based compensation |
- |
|
- |
|
- |
|
- |
|
705,896 |
|
705,896 |
|
||||||
Impairment of goodwill |
177,663 |
|
- |
|
- |
|
- |
|
177,280 |
|
354,943 |
|
||||||
Adjusted EBITDA |
1,313,091 |
|
(1,690,554 |
) |
(228,560 |
) |
(239,149 |
) |
(32,962 |
) |
(878,134 |
) |
(1) |
A combination of multiple business activities that does not meet the quantitative thresholds to qualify as reportable segments are grouped together as “Other Services”. |
|
(2) |
Unallocated expenses are mainly related to share-based compensation, impairment of goodwill of prior acquisitions that are not under our reportable segments, and general and corporate administrative costs such as professional fees and other miscellaneous items that are not allocated to segments. These expenses are excluded from segment results as they are not reviewed by the CODM as part of segment performance. |
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS |
||||||||||||
Amounts expressed in thousands of US dollars (“$”) except for number of shares & per share data |
||||||||||||
|
For the Three Months
|
For the Year
|
||||||||||
|
2022 |
2023 |
2022 |
2023 |
||||||||
|
$ |
$ |
$ |
$ |
||||||||
Revenue |
|
|
|
|
||||||||
Service revenue |
|
|
|
|
||||||||
|
948,857 |
|
510,773 |
|
3,877,163 |
|
2,172,009 |
|
||||
E-commerce and other services |
2,231,133 |
|
2,771,267 |
|
7,463,173 |
|
9,770,376 |
|
||||
Sales of goods |
271,594 |
|
334,588 |
|
1,109,369 |
|
1,121,175 |
|
||||
|
|
|
|
|
||||||||
Total revenue |
3,451,584 |
|
3,616,628 |
|
12,449,705 |
|
13,063,560 |
|
||||
|
|
|
|
|
||||||||
Cost of revenue |
|
|
|
|
||||||||
Cost of service |
|
|
|
|
||||||||
|
(242,470 |
) |
(161,360 |
) |
(1,077,017 |
) |
(672,481 |
) |
||||
E-commerce and other services |
(1,282,174 |
) |
(1,621,218 |
) |
(5,194,065 |
) |
(5,530,043 |
) |
||||
Cost of goods sold |
(229,627 |
) |
(309,263 |
) |
(993,346 |
) |
(1,027,389 |
) |
||||
|
|
|
|
|
||||||||
Total cost of revenue |
(1,754,271 |
) |
(2,091,841 |
) |
(7,264,428 |
) |
(7,229,913 |
) |
||||
|
|
|
|
|
||||||||
Gross profit |
1,697,313 |
|
1,524,787 |
|
5,185,277 |
|
5,833,647 |
|
||||
|
|
|
|
|
||||||||
Operating income (expenses): |
|
|
|
|
||||||||
Other operating income |
68,453 |
|
58,524 |
|
279,184 |
|
221,021 |
|
||||
Sales and marketing expenses |
(473,620 |
) |
(967,433 |
) |
(3,269,223 |
) |
(2,779,223 |
) |
||||
General and administrative expenses |
(352,321 |
) |
(232,603 |
) |
(1,437,612 |
) |
(1,134,724 |
) |
||||
Provision for credit losses |
(175,103 |
) |
(159,988 |
) |
(513,690 |
) |
(633,942 |
) |
||||
Research and development expenses |
(244,195 |
) |
(279,806 |
) |
(1,376,501 |
) |
(1,164,126 |
) |
||||
Impairment of goodwill |
(177,663 |
) |
– |
|
(354,943 |
) |
(117,875 |
) |
||||
|
|
|
|
|
||||||||
Total operating expenses |
(1,354,449 |
) |
(1,581,306 |
) |
(6,672,785 |
) |
(5,608,869 |
) |
||||
|
|
|
|
|
||||||||
Operating income (loss) |
342,864 |
|
(56,519 |
) |
(1,487,508 |
) |
224,778 |
|
||||
Interest income |
54,336 |
|
90,949 |
|
115,515 |
|
331,310 |
|
||||
Interest expense |
(10,809 |
) |
(10,129 |
) |
(45,396 |
) |
(41,075 |
) |
||||
Investment loss, net |
(123,004 |
) |
(80,279 |
) |
(207,331 |
) |
(125,656 |
) |
||||
Net gain on debt extinguishment |
199,697 |
|
38,550 |
|
199,697 |
|
38,550 |
|
||||
Foreign exchange (loss) gain |
(85,247 |
) |
(7,437 |
) |
(75,510 |
) |
4,487 |
|
||||
|
|
|
|
|
||||||||
Income (Loss) before income tax and
|
377,837 |
|
(24,865 |
) |
(1,500,533 |
) |
432,394 |
|
||||
Income tax credit (expense) |
43,461 |
|
(76,894 |
) |
(168,395 |
) |
(262,680 |
) |
||||
Share of results of equity investees |
1,540 |
|
(9,856 |
) |
11,156 |
|
(7,032 |
) |
||||
|
|
|
|
|
||||||||
Net income (loss) |
422,838 |
|
(111,615 |
) |
(1,657,772 |
) |
162,682 |
|
||||
|
|
|
|
|
||||||||
Net loss (income) attributable to non-
|
3,960 |
|
1,875 |
|
6,351 |
|
(11,956 |
) |
||||
|
|
|
|
|
||||||||
Net income (loss) attributable to Sea
|
426,798 |
|
(109,740 |
) |
(1,651,421 |
) |
150,726 |
|
||||
|
|
|
|
|
||||||||
Earnings (Loss) per share: |
|
|
|
|
||||||||
Basic |
0.76 |
|
(0.19 |
) |
(2.96 |
) |
0.27 |
|
||||
Diluted |
0.72 |
|
(0.19 |
) |
(2.96 |
) |
0.25 |
|
||||
|
|
|
|
|
||||||||
Weighted average shares used in earnings
|
|
|
|
|
||||||||
Basic |
560,326,301 |
|
569,527,667 |
|
558,119,948 |
|
566,612,815 |
|
||||
Diluted |
611,938,691 |
|
569,527,667 |
|
558,119,948 |
|
594,405,604 |
|
UNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS |
||||
Amounts expressed in thousands of US dollars (“$”) |
||||
|
|
As of |
||
|
|
2022 |
2023 |
|
|
|
$ |
$ |
|
ASSETS |
|
|
|
|
Current assets |
|
|
|
|
Cash and cash equivalents |
|
6,029,859 |
2,811,056 |
|
Restricted cash |
|
1,549,574 |
1,410,365 |
|
Accounts receivable, net of allowance for credit losses of
|
|
268,814 |
262,716 |
|
Prepaid expenses and other assets |
|
1,798,651 |
1,861,842 |
|
Loans receivable, net of allowance for credit losses of
|
|
2,053,767 |
2,464,662 |
|
Inventories, net |
|
109,668 |
125,395 |
|
Short-term investments |
|
864,258 |
2,547,644 |
|
Amounts due from related parties |
|
13,421 |
290,254 |
|
Total current assets |
|
12,688,012 |
11,773,934 |
|
|
|
|
|
|
Non-current assets |
|
|
|
|
Property and equipment, net |
|
1,387,895 |
1,207,698 |
|
Operating lease right-of-use assets, net |
|
957,840 |
1,015,982 |
|
Intangible assets, net |
|
65,019 |
50,821 |
|
Long-term investments |
|
1,253,593 |
4,262,562 |
|
Prepaid expenses and other assets |
|
135,616 |
87,705 |
|
Loans receivable, net of allowance for credit losses of
|
|
21,663 |
20,551 |
|
Restricted cash |
|
17,724 |
22,236 |
|
Deferred tax assets |
|
245,226 |
328,961 |
|
|
|
230,208 |
112,782 |
|
Total non-current assets |
|
4,314,784 |
7,109,298 |
|
Total assets |
|
17,002,796 |
18,883,232 |
UNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS |
||||
Amounts expressed in thousands of US dollars (“$”) |
||||
|
As of |
|||
|
|
2022 |
2023 |
|
|
|
$ |
$ |
|
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
|
Current liabilities |
|
|
|
|
Accounts payable |
|
258,648 |
342,547 |
|
Accrued expenses and other payables |
|
1,396,613 |
1,834,807 |
|
Deposits payable |
|
1,316,395 |
1,706,299 |
|
Escrow payables and advances from customers |
|
1,862,325 |
2,199,464 |
|
Amounts due to related parties |
|
415 |
64,081 |
|
Borrowings |
|
88,410 |
146,661 |
|
Operating lease liabilities |
|
269,968 |
290,788 |
|
Convertible notes |
|
31,237 |
151,764 |
|
Deferred revenue |
|
1,535,083 |
1,208,892 |
|
Income tax payable |
|
176,598 |
223,638 |
|
Total current liabilities |
|
6,935,692 |
8,168,941 |
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
Accrued expenses and other payables |
|
87,072 |
79,257 |
|
Borrowings |
|
– |
119,323 |
|
Operating lease liabilities |
|
756,818 |
789,514 |
|
Deferred revenue |
|
63,566 |
72,587 |
|
Convertible notes |
|
3,338,750 |
2,949,785 |
|
Deferred tax liabilities |
|
9,967 |
133 |
|
Unrecognized tax benefits |
|
107 |
6,107 |
|
Total non-current liabilities |
|
4,256,280 |
4,016,706 |
|
Total liabilities |
|
11,191,972 |
12,185,647 |
UNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS |
||||||
Amounts expressed in thousands of US dollars (“$”) |
||||||
|
|
As of |
||||
|
|
2022 |
2023 |
|||
|
|
$ |
$ |
|||
Shareholders’ equity |
|
|
|
|||
Class A Ordinary shares |
|
258 |
|
262 |
|
|
Class |
|
23 |
|
23 |
|
|
Additional paid-in capital |
|
14,559,690 |
|
15,283,870 |
|
|
Accumulated other comprehensive loss |
|
(111,215 |
) |
(108,000 |
) |
|
Statutory reserves |
|
12,490 |
|
16,981 |
|
|
Accumulated deficit |
|
(8,745,541 |
) |
(8,599,306 |
) |
|
|
|
|
|
|||
|
|
5,715,705 |
|
6,593,830 |
|
|
Non-controlling interests |
|
95,119 |
|
103,755 |
|
|
Total shareholders’ equity |
|
5,810,824 |
|
6,697,585 |
|
|
Total liabilities and shareholders’ equity |
|
17,002,796 |
|
18,883,232 |
|
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||||||
Amounts expressed in thousands of US dollars (“$”) |
||||||||||||
|
For the Three Months ended
|
For the Year ended
|
||||||||||
|
2022 |
2023 |
2022 |
2023 |
||||||||
|
$ |
$ |
$ |
$ |
||||||||
|
|
|
|
|
||||||||
|
|
|
|
|
||||||||
Net cash generated from (used in)
|
319,691 |
|
278,833 |
|
(1,055,692 |
) |
2,079,688 |
|
||||
Net cash generated from (used in)
|
51,522 |
|
(1,048,554 |
) |
(2,428,809 |
) |
(5,804,462 |
) |
||||
Net cash (used in) generated from financing activities |
(513,711 |
) |
183,385 |
|
400,256 |
|
366,011 |
|
||||
Effect of foreign exchange rate changes
|
109,112 |
|
68,317 |
|
(143,511 |
) |
(7,964 |
) |
||||
Net decrease in cash, cash equivalents and restricted cash |
(33,386 |
) |
(518,019 |
) |
(3,227,756 |
) |
(3,366,727 |
) |
||||
Cash, cash equivalents and restricted cash at beginning of the period(1) |
7,643,770 |
|
4,761,676 |
|
10,838,140 |
|
7,610,384 |
|
||||
|
|
|
|
|
||||||||
Cash, cash equivalents and restricted
|
7,610,384 |
|
4,243,657 |
|
7,610,384 |
|
4,243,657 |
|
(1) |
As of |
Net cash used in investing activities amounted to
Net cash used in investing activities amounted to
UNAUDITED SEGMENT INFORMATION
The Company has three reportable segments, namely digital entertainment, e-commerce and digital financial services. The Chief Operating Decision Maker (“CODM”) reviews the performance of each segment based on revenue and certain key operating metrics of the operations and uses these results for the purposes of allocating resources to and evaluating the financial performance of each segment. Amounts are expressed in thousands of US dollars (“$”).
|
For the Three Months ended |
|||||||||||||||
|
Digital
|
E-
|
Digital
|
Other
|
Unallocated
|
Consolidated |
||||||||||
|
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||
Revenue |
510,773 |
2,591,272 |
|
472,389 |
42,194 |
|
- |
|
3,616,628 |
|
||||||
Operating income (loss) |
261,060 |
(303,681 |
) |
134,205 |
(9,558 |
) |
(138,545 |
) |
(56,519 |
) |
||||||
Non-operating income, net |
|
|
|
|
|
31,654 |
|
|||||||||
Income tax expense |
|
|
|
|
|
(76,894 |
) |
|||||||||
Share of results of equity investees |
|
|
|
|
|
(9,856 |
) |
|||||||||
Net loss |
|
|
|
|
|
(111,615 |
) |
|
For the Three Months ended |
||||||||||||||
|
Digital
|
E-
|
Digital
|
Other
|
Unallocated
|
Consolidated |
|||||||||
|
$ |
$ |
$ |
$ |
$ |
$ |
|||||||||
Revenue |
948,857 |
2,102,740 |
380,172 |
19,815 |
|
- |
|
3,451,584 |
|||||||
Operating income (loss) |
400,165 |
109,486 |
61,841 |
(28,714 |
) |
(199,914 |
) |
342,864 |
|||||||
Non-operating income, net |
|
|
|
|
|
34,973 |
|||||||||
Income tax credit |
|
|
|
|
|
43,461 |
|||||||||
Share of results of equity investees |
|
|
|
|
|
1,540 |
|||||||||
Net income |
|
|
|
|
|
422,838 |
(1) |
A combination of multiple business activities that does not meet the quantitative thresholds to qualify as reportable segments are grouped together as “Other Services”. |
|
(2) |
Unallocated expenses are mainly related to share-based compensation, impairment of goodwill of prior acquisitions that are not under our reportable segments, and general and corporate administrative costs such as professional fees and other miscellaneous items that are not allocated to segments. These expenses are excluded from segment results as they are not reviewed by the CODM as part of segment performance. |
|
For the Year ended |
|||||||||||||||
|
Digital
|
E-
|
Digital
|
Other
|
Unallocated
|
Consolidated |
||||||||||
|
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||
Revenue |
2,172,009 |
9,000,848 |
|
1,759,422 |
131,281 |
|
- |
|
13,063,560 |
|
||||||
Operating income (loss) |
1,177,871 |
(550,470 |
) |
490,209 |
(56,728 |
) |
(836,104 |
) |
224,778 |
|
||||||
Non-operating income, net |
|
|
|
|
|
207,616 |
|
|||||||||
Income tax expense |
|
|
|
|
|
(262,680 |
) |
|||||||||
Share of results of equity investees |
|
|
|
|
|
(7,032 |
) |
|||||||||
Net income |
|
|
|
|
|
162,682 |
|
|
For the Year ended |
||||||||||||||||
|
Digital
|
E-
|
Digital
|
Other
|
Unallocated
|
Consolidated |
|||||||||||
|
$ |
$ |
$ |
$ |
$ |
$ |
|||||||||||
Revenue |
3,877,163 |
7,288,677 |
|
1,221,996 |
|
61,869 |
|
- |
|
12,449,705 |
|
||||||
Operating income (loss) |
1,971,416 |
(2,013,360 |
) |
(277,264 |
) |
(252,162 |
) |
(916,138 |
) |
(1,487,508 |
) |
||||||
Non-operating loss, net |
|
|
|
|
|
(13,025 |
) |
||||||||||
Income tax expense |
|
|
|
|
|
(168,395 |
) |
||||||||||
Share of results of equity investees |
|
|
|
|
|
11,156 |
|
||||||||||
Net loss |
|
|
|
|
|
(1,657,772 |
) |
(1) |
A combination of multiple business activities that does not meet the quantitative thresholds to qualify as reportable segments are grouped together as “Other Services”. |
|
(2) |
Unallocated expenses are mainly related to share-based compensation, impairment of goodwill of prior acquisitions that are not under our reportable segments, and general and corporate administrative costs such as professional fees and other miscellaneous items that are not allocated to segments. These expenses are excluded from segment results as they are not reviewed by the CODM as part of segment performance. |
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