SeaMoney's Ascendancy

SeaMoney, the company's digital financial services arm, has emerged as Sea's second-largest business unit, surpassing digital entertainment. For the full year, SeaMoney's revenue climbed by 34.6% to US$2.4 billion, up from US$1.8 billion. Adjusted EBITDA for SeaMoney grew by 29.5%, reaching US$712.2 million. The loan portfolio to consumers and small and medium-sized enterprises expanded by 63.9%, totaling US$5.1 billion as of December 31, 2024, with a stable non-performing loan ratio of 1.2%.

Li expects SeaMoney's loan book to grow at a pace surpassing Shopee's GMV annual growth rate in 2025, driven by enhanced credit penetration both within and outside the Shopee ecosystem.

Market Reception and Stock Performance

Following the announcement of these robust financial results, Sea Limited's stock experienced a significant uptick. The company's American Depositary Receipts (ADRs) saw their IBD SmartSelect Composite Rating elevate from 88 to a near-perfect 99, indicating superior performance across key investment metrics. This rating suggests that Sea's stock now outperforms 99% of all stocks in crucial stock-picking criteria.

The stock's Relative Strength Rating stands at 97, reflecting its substantial market performance over the past year. Additionally, Sea's Earnings Per Share (EPS) Rating is 80, indicating that its recent earnings growth surpasses 80% of all stocks. The Accumulation/Distribution Rating of B suggests moderate institutional buying over the past 13 weeks.

Strategic Initiatives and Future Outlook

Sea Limited has been proactive in integrating artificial intelligence (AI) to enhance customer service capabilities. Upgrades to AI-powered chatbots have led to a significant increase in customer satisfaction scores and a nearly 30% reduction in customer service costs year-on-year. The company has also leveraged large language model capabilities to improve its buyer return refund process, achieving a 40% improvement in resolution times in the Asia market, with nearly 60% of cases resolved within one day.

Furthermore, Sea has strengthened its content ecosystem, with live streaming now contributing approximately 15% of Shopee's overall order volume for physical goods in Southeast Asia. In Q4, average daily unique streamers and viewers grew by over 40% and 30% year-on-year, respectively. In Indonesia, Shopee maintained its lead as the largest live streaming e-commerce platform throughout 2024.

In summary, Sea Limited's

Garena's Resurgence

Sea's digital entertainment division, Garena, showcased a strong performance, with Q4 bookings rising by 19% to US$543.2 million, up from US$456.3 million in the same quarter of the previous year. For the full year, bookings reached US$2.1 billion, marking an 18.7% increase from US$1.8 billion previously. The mobile game "Free Fire" has been a significant driver of this growth. Li anticipates double-digit growth in both user base and bookings for Garena in 2025.

Shopee's Outstanding Performance

Shopee, Sea's e-commerce platform, continued its upward trajectory with a 23.5% increase in gross merchandise value (GMV) for Q4, amounting to US$28.6 billion compared to US$23.1 billion in the previous year. Quarterly revenue for Shopee rose by 41.3% year-on-year, reaching US$3.7 billion.

Financial Performance Overview

In Q4 2024, Sea Limited achieved a net profit of US$237.6 million, a remarkable reversal from the US$111.6 million loss recorded during the same period in the previous year. This net profit, however, slightly missed analysts' expectations of US$239.3 million. The company's revenue surged by 36.9% year-on-year, reaching US$5 billion, surpassing the anticipated US$4.7 billion.

For the full year, Sea's net profit more than doubled to US$447.8 million from US$162.7 million in the prior year. Annual revenue grew by 28.8%, totaling US$16.8 billion, up from US$13.1 billion.

Sea Limited Shares Climb on Strong Revenue Performance

Sea Limited, a prominent technology conglomerate in Southeast Asia, has reported robust financial results for the fourth quarter of 2024, signaling a significant turnaround and promising growth across its diverse business units.

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