Shopee Parent Company Sea Ltd Reports eCommerce Growth in Q2 of 2024

Sea Ltd Announces Q2'2024 Results: Key Insights

• Sea Ltd Reports Growth: Overall revenues increased in the second quarter of 2024 from the previous year. Revenue was up 23% and gross profit up 9.2%.

• Development per Segment: eCommerce on Shopee is Sea Ltd's most valuable branch, where revenues grew by 33.7%. The other segments contribute smaller shares: Revenues from financial services increased by 21.4%. The number of users on Sea's gaming platform grew, but with revenue declines of 17.7%.

Sea Limited, the parent company of Shopee, has announced its financial results for the second quarter of 2024, which ended on June 30. Sea's Q2’2024 revenue grew year-on-year, with revenue up 23% and gross profit up 9.2%. The group generates revenue from its eCommerce platform Shopee, digital financial services, and digital entertainment, i.e. gaming.  

Here are the results for Q2’24.

eCommerce Revenues Grew a Third YoY in the Second Quarter of 2024

Shopee is Sea Ltd's eCommerce business, which is on a solid trajectory in Southeast Asia and some Latin American countries. 

A pandemic growth surge resulted in sustained higher order numbers, so Sea's latest earnings update confirms analysts' positive expectations for 2024 revenues. The 2020 and 2021 restrictions have improved Shopee's GMV, taking it to new levels from which it continues to grow.

More precisely, Sea announced that GMV for Q2’2024 was US$23.3 billion. This represents a year-over-year increase of 29.1%. As GMV measures marketplace activity, or the goods bought and sold on a platform, Shopee and Sea profit by taking fees for providing the marketplace. eCommerce revenue was therefore US$2.8 billion, up 33.7% year-on-year. 

Two-thirds of Shopee's total revenue comes from eCommerce. The remainder comes from digital financial services and digital entertainment.

Other Segments: Financial Services and Gaming Platform

SeaMoney provides digital payment services like e-wallets and financial products like loans. Revenues for this business segment were US$519.3 million, an increase of 21.4% from Q2’23. Sea reports that these financial services primarily include consumer and SME loans, which grew 39.5% year over year. 

While Sea Ltd’s gaming service Garena saw higher engagement, revenues declined by 17.7% compared to Q2’23. The platform saw an increase in the number of users and slightly higher average bookings per user, as well as an 8.1% share of quarterly paying users. The decrease in revenues is due to higher investments in the quarter. 

Sea Ltd’s overall revenue grew year-over-year in Q2’24. eCommerce on Shopee is an important basis to cover most of the conglomerate’s revenue. The financial services growth comes amid a time in which consumers and small businesses are looking for additional ways to manage growing expenses. Gaming is clearly an in-demand pastime for consumers, but with lower willingness to spend relative to the influx of users.

 Sources: Investopedia – Sea – Yahoo! Finance: 1 2