(Reuters) -Sea Ltd topped Wall Street estimates for fourth-quarter revenue on Tuesday, helped by strong growth in its financial services segment and e-commerce platform Shopee.
U.S-listed shares of the Southeast Asian technology conglomerate were up 5.5% in early morning trading.
Indonesia’s e-commerce market leader, Shopee, has attracted a large user base and become a significant growth driver for its parent company.
Sea’s e-commerce segment, which accounts for more than two-thirds of the company’s total business, reported a 41.3% jump in revenue on higher consumer spending during the holiday quarter.
Shopee’s “savings” brand image might be something that emerging competitors find difficult to overcome, according to venture and insights firm Momentum Works.
Sea expects Shopee’s gross merchandise volume (GMV), the value of goods sold, to grow about 20% this year as it sees strength across the e-commerce markets in Asia and Brazil.
The company is seeing improvements in order frequencies from markets where customers enjoy same-day delivery services, executives said on a post-earnings call.
Sea also expects Garena, its digital entertainment business that offers popular games such as Free Fire, to grow in the double-digit percentage range in terms of user base and bookings this year.
Users have responded positively to a collaboration between Free Fire and popular anime television series Naruto: Shippuden, giving the game a strong start to the year, CEO Forrest Li said.
Revenue at Sea’s financial services business, which is home to digital payments and financial services provider SeaMoney, grew 55.2%, beating analysts’ estimates of a 35.3% increase, according to data compiled by LSEG.
Sea in September announced a partnership with Alphabet’s YouTube, which will allow users in Indonesia to purchase products featured on YouTube via direct links to Shopee.
The company’s revenue rose 36.9% to $4.95 billion in the quarter, compared with analysts’ estimate of $4.62 billion.
(Reporting by Harshita Mary Varghese in Bengaluru; Editing by Shinjini Ganguli)
