Shopee hits profit milestone; Sea in the black for 2 straight quarters

Sea, Singapore’s largest homegrown internet company valued at over US$85 billion at the time of writing, has seen robust growth in revenue and profit, according to its Q3 2020 financial results.

The group has been profitable for two straight quarters on an adjusted EBITDA basis.

Meanwhile, its ecommerce arm Shopee appears to have hit a milestone in its sustainability drive.

Perhaps for the first time, Sea’s revenue from ecommerce and other services as well as goods sold has exceeded its costs in those areas. This could indicate that Shopee is gross profitable, or close to it.

Shopee with Blackpink / Photo credit: Shopee

That said, it seems that much of SeaMoney’s spending has gone towards Shopee’s e-wallet, ShopeePay. It can then be argued that those expenses should be considered part of the ecommerce unit.

On the other hand, SeaMoney is expected to become a revenue-generating unit that makes money from transaction fees and financial services. It’s also diversifying from Shopee. As such, there’s also a case for putting SeaMoney’s spending in a separate bucket.

See: Can Shopee become profitable? Here’s an in-depth analysis

Here’s a look at its key financial numbers on a company-wide level. It’s seeing accelerated growth from Q2 to Q3:

Here’s a look at its growing expenses, which is keeping pace with revenue:

Sea has accumulated a hefty war chest, which is increasingly being funded by its profits: