Sea Limited Q4 Earnings Miss Estimates but Revenues Increase
Sea Limited Q4 Earnings Miss Estimates, Revenues Increase Y/Y
Sea Limited SE reported adjusted earnings of 80 cents per share in the fourth quarter of 2025, which increased 29% from the year-ago quarter but missed the Zacks Consensus Estimate by 11.11%.
Revenues of $6.9 billion increased 38.4% on a year-over-year basis, primarily driven by growth in Shopee and Monee. The top line beat the Zacks Consensus Estimate modestly by 0.65%.
SE’s Q4 Top-Line Details
E-commerce (Shopee): Shopee revenues totaled $5 billion, up 35.8% year over year, which includes GAAP marketplace revenues of $4.3 billion and GAAP product revenues of $0.6 billion.
GMV increased by 28.6% year on year to $36.7 billion in the fourth quarter.
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Gross orders for the reported quarter reached 4 billion, representing a 30.5% year-over-year increase.
Shopee strengthened its market leadership in Asia and Brazil, driven by its highly competitive pricing. In 2025, Shopee served around 400 million active buyers and 20 million sellers, achieving 127 billion dollars in GMV.
The company expects Shopee’s full-year 2026 GMV to increase around 25% on a year-over-year basis.
Digital Financial Services (Monee): Monee’s revenues jumped 54.3% year over year to $1.1 billion, driven primarily by strong expansion in the credit business as lending activities increased.
Consumer and SME loan principal outstanding surged 80% year over year to $9.2 billion as of December end.
Non-performing loans over 90 days were stable at 1.1% of total consumer and SME loans in the reported quarter, indicating strong credit quality.
Digital Entertainment (Garena): Garena revenues were $701 million, marking year-over-year growth of 35.1%. The growth was largely attributable to growth in active users, coupled with improved paying user penetration.
Quarterly active users were 633.3 million, up 2.5% year over year.
Quarterly paying users of 58 million increased 15% year over year. The paying user ratio was 9.2% in the fourth quarter compared with 8.2% in the year-ago quarter.
Average bookings per user in the reported quarter were $1.06 compared with $0.88 in the year-ago quarter. Garena's total bookings grew 23.8% year-over-year to $672.4 million.
Sales of goods increased 35.8% year over year to $640.6 million in the fourth quarter.
Other Services, which encompass a mix of various business activities, increased 25.2% year over year to $42.2 million in the fourth quarter.
Sea Limited’s Operating Details
Gross profit increased 36% year over year to $3 billion in the fourth quarter. The company’s gross margin contracted 80 basis points (bps) year over year to 43.8%.
Sea Limited reported an adjusted EBITDA of $787.1 million in the quarter under review, up 33.2% year over year, representing an adjusted EBITDA margin of 11.5%, which narrowed 40 bps.
Shopee's adjusted EBITDA reached $202.5 million in the fourth quarter, up sharply from $152.2 million in the same period last year.
Monee’s adjusted EBITDA increased 24.7% year over year to $263.1 million, up from $211 million in the prior-year period.
Garena's adjusted EBITDA rose 25.6% year over year to $363.8 million in the fourth quarter, from $289.7 million in the prior-year period.
SE’s Balance Sheet & Cash Flow
As of Dec. 31, 2025, SE had cash and cash equivalents of $4.16 billion compared with $3.07 billion as of Sept. 30, 2025.
During the fourth quarter of 2025, the company repurchased 116.2 thousand shares for an aggregate of $14.5 million as part of its $1.0 billion share repurchase program.
SE generated $1.48 billion in cash from operating activities in the reported quarter compared with $1.18 billion in the previous quarter.
SE’s Zacks Rank & Stocks to Consider
Currently, Sea Limited carries a Zacks Rank #5 (Strong Sell).
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