Despite weakening monetisation, chief executive Forrest Li said that Garena has seen an improvement in its active user base, adding that the company will be launching new gaming titles in the coming months. He added that the responses from users to the new titles have been positive thus far.
“The first quarter of 2023 was another strong quarter for us,” said Mr Li in a statement.
“Across our business, we have been focused on maximizing operational efficiency and improving user experiences. And we continued to make meaningful progress on both fronts.”
Mr Li stressed that the results from the quarter “once again demonstrates the fundamental strength and resilience of our business model”.
He said that Sea remains confident that it can continue to create value for participants within its ecosystem, and deliver long term growth and sustainable returns for its shareholders.
The company had also announced a 5 per cent pay increase for employees just last week.
SINGAPORE - Sea Ltd on Tuesday reported a second quarterly profit following its first ever profitable quarter at the end of 2022, marking a continuation of the group’s recovery after the company aggressively cut costs and retrenched workers.
The Singapore-based gaming and e-commerce company reported net income totalling US$87.3 million for the first quarter of 2023 compared with a net loss of US$580.1 million for the first quarter of 2022.
This came on the back of revenues totalling US$3.04 billion for the quarter, up 5 per cent year-on-year.
Despite reporting overall growth, Sea’s stock commenced trading Tuesday in the US below US$77 each, down by almost 13 per cent. The company’s performance fell short of analysts’ predictions for first-quarter net income of US$223 million.
The shortfall in total net income for the quarter was due to a US$117.9 million impairment of goodwill associated with prior acquisitions, the company said.
Sea’s growth in the first quarter was driven primarily by its e-commerce arm, Shopee, which saw a revenue jump of 36.3 per cent year-on-year to US$2.1 billion.
Adjusted earnings before interest, taxes, depreciation and amortisation (Ebitda) for e-commerce was US$207.7 million for the quarter, compared with losses of US$742.8 million for the first quarter of 2022.
Ebitda is adjusted to include unallocated expenses and helps to identify underlying trends in Sea’s operating results.
Looking forward, the company seeks to strengthen the e-commerce business by improving its logistics and delivery systems and furthering its reach by working with influencers.
The group’s financial services arm, Sea Money, also grew, reporting a 75 per cent year-on-year rise in revenues to US$412.8 million for the quarter.
To support continued growth, Sea Money will look to further diversify its offerings as well as its funding sources.
Garena, the group’s gaming and digital arm, held overall growth back, with the business seeing a drop in cash spent by users in the first quarter of 2023 compared to the same period in 2022.