Southeast Asian internet giant Sea Group reported a 10.3% dip in revenues on a quarter-on-quarter basis in the first three months of 2022, which were especially hit by the sluggish performance of its digital entertainment unit Garena and ecommerce arm Shopee.
It was the first quarter in which Sea saw a slide in its revenue, which was on an upward trajectory.
Photo credit: Reuters
Shopee’s earnings stayed flat, with GAAP revenue standing at US$1.5 billion, down over 6% from Q4 2021.
Garena saw a larger drop of over 27% to US$1.1 billion in its GAAP revenue from the previous quarter. The gaming vertical’s active users also shrank by 6% from Q4 2021 to 615.9 million.
Sea also reported a decline in cash and cash equivalents by over 20% from the previous quarter, whereas it also succeeded in cutting expenses by 5% on a quarter-on-quarter basis.
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The company, however, reported rosier year-on-year (YoY) earnings, with its total revenue rising 64.4% and gross profit gaining 81.3%.
However, its YoY net loss widened 37% to US$580.1 million. The operating loss on a YoY basis also went up nearly 6x to US$509.9 million.
The ecommerce vertical saw a 64.4% growth from the same quarter last year, while revenue from digital entertainment jumped 45.3% YoY.
“As we enter a new period, we recognize that the current macro trends and uncertainties could affect our region and the world in the near to mid-term,” Sea Group CEO Forrest Li said in a statement.
Editing by Collin Furtado and Eileen C. Ang
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