:South East Asian technology firm Sea Ltd beat third-quarter revenue estimates on Tuesday and said its e-commerce business, Shopee, turned profitable, sending its shares up more than 17 per cent in early trading.
The stock opened at its highest in more than two years, after more than doubling in value this year.
Shopee reported growth in purchases across Southeast Asia and Taiwan as consumers splurged ahead of the holiday and travel season.
The business achieved adjusted core profit in the third quarter in Asia and Brazil, said Sea CEO Forrest Li.
Shopee is available mostly in Southeast Asia and Brazil after exiting India, and some markets in Europe and Latin America.
“As we continue to focus on delivering growth, we expect Shopee to remain profitable going forward,” Li added.
The segment, which makes up more than two-thirds of the company’s total business, reported an adjusted core profit of $34.4 million in the quarter ended Sept. 30, compared with a loss of $346.5 million a year earlier.
The boost came from a 42.6 per cent surge in e-commerce revenue to $3.2 billion, which far exceeded analysts’ expectations of $2.92 billion, according to data compiled by LSEG.
While Shopee remains a dominant force in Southeast Asia, it has faced challenges in certain markets due to economic headwinds and stiff competition from rivals such as Lazada and global giant Amazon.
To beat competition, the company has diversified into digital finances and entertainment to tap into growing demand for such services.
The financial services business, which is home to digital payments and financial services provider SeaMoney, reported revenue growth of 38 per cent, beating estimates of a 21.7 per cent increase.
Sea’s total revenue jumped 30.8 per cent to $4.33 billion in the quarter, above analysts’ consensus estimate of $4.08 billion.
