Sea Limited reports net profit of S$218.7M for FY2023

SINGAPORE: Singapore-founded Sea Limited reports a net profit of S$218.7 million (US$162.7 million) for the fiscal year 2023 ended Dec 31, 2023, marking a significant milestone with its first full year of annual profit since its initial public offering (IPO) back in Oct 2017, The Edge Singapore reports.

This achievement is a stark contrast to the previous fiscal year, FY2022 when the group recorded a net loss of S$2.23 billion (US$1.66 billion). The turnaround is striking, indicating a positive trajectory for Sea Limited.

For FY2023, earnings per share (EPS) on a fully diluted basis amounted to S$0.34 (25 US cents), a noteworthy improvement from the loss per share of S$3.98 (US$2.96) in FY2022.

The company’s total GAAP revenue for the full-year period reached S$13.1 billion, showing a healthy increase of 4.9% year-on-year.

This growth was primarily driven by its e-commerce segment, Shopee, which experienced a remarkable 23.5% year-on-year surge in GAAP revenue, reaching S$12.10 billion (US$9.0 billion).

Shopee

Despite the revenue growth, Shopee’s adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) stood at a loss of S$287.39 million (US$213.8 million) for FY2023, showing improvement from the previous fiscal year’s loss of S$2.29 billion (US$1.7 billion).

The segment also witnessed an 8.8% year-on-year increase in gross orders, totalling 8.2 billion for FY2023, with significant gains in Southeast Asian market share.

Garena

However, Sea Limited’s digital entertainment segment, Garena, experienced a decline in GAAP revenue, dropping to S$2.96 billion (US$2.2 billion) in FY2023 from S$5.24 billion (US$3.9 billion) in FY2022.

Bookings also decreased to S$2.42 billion (US$1.8 billion) from S$3.76 billion (US$2.8 billion), with adjusted EBITDA falling by 29.9% year-on-year to S$1.2 billion (US$920.9 million).

Despite these challenges, Free Fire, Garena’s flagship mobile game, maintained its status as the most downloaded mobile game globally in 2023.

SeaMoney

SeaMoney, the company’s digital financial services arm, demonstrated significant growth, with GAAP revenue reaching S$2.42 billion (US$1.8 billion) for FY2023, marking a 44.0% year-on-year increase.

Adjusted EBITDA for SeaMoney stood at S$739.45 million (US$550.1 million), a substantial improvement from the previous fiscal year’s loss of S$307.29 million (US$228.6 million).

As of Dec 31, 2023, Sea Limited’s total loans receivable increased to S$3.31 billion (US$2.46 billion), while its cash position, including cash equivalents, short-term investments, and other treasury investments, amounted to S$11.43 billion (US$8.5 billion). This represents a net increase of S$760.42 million (US$565.7 million) from Sept 30, 2023.

Commenting on the company’s performance, Chairman and CEO Forrest Li expressed satisfaction with Sea Limited’s achievements in 2023.

He highlighted the company’s profitability, strengthened market leadership in e-commerce, growth in digital financial services, and stabilisation of the digital entertainment business.

Li also said, “We have emerged with a much stronger balance sheet with our cash position increasing to US$8.5 billion as of the end of 2023, demonstrating the discipline and prudence we have applied in our investments over the past year. Looking ahead, we expect 2024 to be another profitable year.” /TISG

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