Sea’s losses widen amid revenue growth; president will step down end-2018

Nick Nash, Sea’s outgoing group president, at Tech in Asia Tokyo 2016 / Photo credit: Tech in Asia

Sea reported both increased revenues and wider losses in its fourth quarter and full year results, which it released today.

Shares in the Singapore-based internet company fell more than 10 percent on the results, closing the day at US$10.96. The company’s October IPO was priced at US$15.

Sea – which counts Garena (gaming and entertainment), Shopee (ecommerce), and AirPay (digital financial services) among its brands – also said it is set to lose its group president Nick Nash, who will step down from the role at the end of this year. 

Nash retired from his position on Sea’s board of directors last week, with group chief financial officer Tony Hou taking his place.

There is a good long lead in time to ensure Nick’s smooth transition.

A Sea spokesperson told Tech in Asia that Nash will “return to his roots in investment” following his departure. Nash joined the company – then named Garena – in December 2014, after a decade-plus stint at US investment firm General Atlantic.

The spokesperson added that Sea has no immediate plans to appoint another group president, and indicated that founder and group CEO Forrest Li will take over at least some of Nash’s responsibilities.

“[Nash’s] role has been and continues to be focused on Sea’s long-term strategies. Our group CEO has been actively overseeing key strategic initiatives and communications of the company, and there is a good long lead in time to ensure Nick’s smooth transition,” they said. 

In a Sea internal email published by TechCrunch, Li paid tribute to Nash and suggested he is planning on launching a private equity fund after his departure which will “focus on supporting the next generation of technology and technology-enabled businesses in Asia.”

Revenues and losses beat predictions

Sea booked adjusted revenue of US$165 million for the three months ending December 31, up 72.8 percent on Q4 2016 and 8.3 percent on Q3 2017.

While this beat expectations, the group’s Q4 2017 adjusted net loss was US$252 million, up 306 percent from Q4 2016’s US$62 million net loss. This came in wider than the US$201 million estimated by Thomson Reuters prior to the announcement, based on an average of three analysts’ predictions.

Slower growth anticipated

Analysts remain bullish