Sea Limited’s SE shares have gained 44.7% over the trailing six months, significantly outpacing the Zacks Computer & Technology sector’s return of 4.9% and the Zacks Internet Software industry’s appreciation of 14.8%.

SE shares have also outperformed industry peers, including HubSpot HUBS, Workday WDAY and nCino NCNO, in the same period.

Over the same timeframe, HubSpot, Workday and nCino shares have gained 25.1%, 11.9% and 7.8%, respectively.

SEA Limited’s strong performance is driven by consistent top-line growth, supported by the strength of its core segments, which include e-commerce (Shopee), digital financial services (SeaMoney) and digital entertainment (Garena).

E-commerce & Digital Services Propel SE’s Prospects

Sea Limited's impressive performance is largely driven by substantial growth in its core businesses. These segments are pivotal to the company's success, each addressing critical market needs.

Shopee dominates the e-commerce space with rapid gross merchandise value growth and operational efficiency. This platform has demonstrated significant improvement, solidifying its position as a leader in Southeast Asia's e-commerce market, driven by growth in gross orders, highlighting Shopee's expanding user base and enhanced engagement.

Shopee increased its monetization by optimizing market dynamics in Southeast Asia, resulting in higher commission rates across the industry. This strategy has helped improve profitability and revenue per transaction while strengthening its position in the e-commerce market.

The third quarter was significant for Shopee, as its loan book grew 70% year over year, and it added 4 million first-time borrowers. Active loan users reached 24 million, up 60%. The non-performing loan ratio was stable at 1.2%. Sea Limited engages first-time borrowers through SPayLater, offering a small credit limit and short tenure on Shopee purchases.

SPX Express enhances e-commerce by providing fast delivery and cost efficiency, with 50% of orders in Asia delivered within two days. Improved costs in Asia and Brazil strengthen logistics. The rise of live streaming boosts the content ecosystem, supporting e-commerce growth.

The digital entertainment segment demonstrated significant growth potential, with total bookings increasing more than 24% in the third quarter of 2024. This momentum is driven by the success of Free Fire, one of the world's leading mobile games, which consistently attracts more than 100 million daily active users.

Free Fire has been one of the world's largest mobile games and continues to captivate users with high engagement and acquisition. In October 2024, it became the first online popular game to partner with Thailand's Zoological Park Organization, introducing the adorable baby pygmy hippo, Moo Deng, to its virtual world.

SE’s Growth Fueled by Collaborations & Product Launches

A recent boost to Shopee's content efforts comes from a new collaboration with YouTube in Indonesia, allowing creators to embed clickable buttons in their videos for direct purchases from Shopee. This partnership has now expanded to Thailand and Vietnam, with plans to extend it to more markets.

Shopee collaborated with Malaysia's Ministry of Health to launch the "Pek Kasih Mama" initiative, aiming to uplift local communities by enhancing online sales capabilities for entrepreneurs.

Garena recently launched Need for Speed Mobile in Taiwan, Hong Kong and Macau, and has become the top racing mobile game in terms of downloads in all locations.

Garena is enhancing its partnership with Tencent to bring Delta Force, a first-person tactical shooter, to PC and mobile users across Southeast Asia, Middle East and North Africa (MENA) and Latin America. This collaboration is set to strengthen Garena’s gaming portfolio in these regions.

The Zacks Consensus Estimate for first-quarter 2025 revenues is pegged at $4.8 billion, suggesting 26.7% year-over-year growth.

The consensus mark for earnings is pegged at 87 cents per share, unchanged over the past 30 days. The consensus mark indicates a year-over-year surge of 314.29%.

The Zacks Consensus Estimate for SE’s 2025 revenues is pegged at $19.62 billion, implying growth of 17.64% from the 2024 actual.

The consensus mark for earnings is pegged at $4.03 per share, unchanged over the past 30 days. The consensus mark indicates a year-over-year upsurge of 91%.

SE’s earnings missed the Zacks Consensus Estimate in the trailing four quarters, delivering an average negative surprise of 55.54%.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Zacks Rank

SE currently sports a Zacks Rank #1 (Strong Buy), which implies that investors should start accumulating the stock right now. You can see the complete list of today’s Zacks #1 Rank stocks here.

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