(Reuters) -Sea Ltd topped market estimates for quarterly revenue on Tuesday, powered by strong demand in its Shopee e-commerce business and its gaming division, sending the company’s U.S.-listed shares nearly 19% higher in early trading.
Shopee, a popular e-commerce platform in Southeast Asia and Taiwan, is seeing strong consumer demand, thanks to the company’s efforts to offer competitive pricing and improved customer experience.
The company has been working to improve user acquisition, traffic and engagement on its Shopee app by introducing social elements like live-streaming and mini-games with redeemable coins and prizes.
Revenue from Sea’s e-commerce unit, which turned profitable last year, jumped 33.7% to $3.8 billion in the April-June quarter.
Gross merchandise value – a measure of the total value of products sold on the platform – rose 28% to $29.8 billion. On a post-earnings call, executives said Shopee’s annual GMV growth would come in better than the company’s prior expectations for a 20% increase.
“All three of our businesses have delivered robust, healthy growth, giving us greater confidence of delivering another great year,” CEO Forrest Li said.
“Our company has reached a stage where we can pursue growth opportunities while improving profitability.”
Meanwhile, revenue at Sea’s digital entertainment unit rose 28.4% to $559.1 million. The segment houses online game developer and publisher Garena, widely known for its popular mobile shooter game “Free Fire”.
Garena reported a 17.8% jump in paying users and a 23% increase in bookings for the June quarter.
Bookings at Garena are now expected to grow more than 30% this year, Li said.
Sea’s digital financial products arm, home to its Monee app that offers services such as payment processing and credit products, reported a 70% rise in revenue to $882.8 million.
Singapore-based Sea reported a 38.2% rise in total second-quarter revenue to $5.26 billion, beating estimates of $4.98 billion, according to data compiled by LSEG.
(Reporting by Deborah Sophia in Bengaluru; Editing by Tasim Zahid and Leroy Leo)
