---
endpoint: analytics
pattern: Internet
status: done
latency_ms: 278997
conversation_id: d16097cc-b4c9-4a18-ac42-104ee00e4401
citations: 23
created: 2026-05-31 19:35:26Z
---

# Provide a one‑year narrative of Sea Limited, outlining how business performance, market conditions, and company actions shaped investor sentiment and valuation.

# Sea Limited (SE) — One-Year Narrative (May 2025 → May 2026)

The past year compressed Sea's full investor cycle into twelve months: from a "firing on all cylinders" growth-and-margin story that drove the stock to multi-year highs near $145 in November 2025, through a sharp ~40% drawdown into March 2026 as management signalled a fresh re-investment phase, to a partial recovery on a Q1 2026 beat. Operational execution remained strong throughout — the controversy was entirely about how aggressively to harvest margins versus reinvest them.

---

## 1. The Operational Backbone: Five Earnings Prints

| Quarter | Reported | Revenue | YoY | Adj. EBITDA | Shopee GMV | YoY | Monee Loan Book | Garena Bookings |
|---|---|---|---|---|---|---|---|---|
| Q1 2025 | 13-May-2025 | $4.8B | +30% | $947M | $28.6B | +22% | $5.8B (+75%) | $775M (+51%) [2] |
| Q2 2025 | 12-Aug-2025 | $5.3B | +38% | $829M | $29.8B | +28% | $6.9B (+90%) | $661M (+23%) [4] |
| Q3 2025 | 11-Nov-2025 | $6.0B | +38% | $874M | $32.2B | +28% | $7.9B (+70%) | $841M (+51%) [7] |
| Q4 2025 | 03-Mar-2026 | $6.9B | +38% | $787M | $36.7B | +29% | $9.2B (+80%) | $672M (+24%) [11][12] |
| Q1 2026 | 12-May-2026 | $7.1B | +47% | $1.03B | $37.3B | +30% | $9.9B (+71%) | $931M (+20%) [14][15] |
| **FY2025** | | **$22.9B** | **+36%** | **$3.4B** | **$127B** | **+27%** | **$9.2B** | **$2.9B (+37%)** [10][11] |

Net income for FY2025 reached **$1.6B versus $448M in 2024 — a 260% jump** — with adjusted EBITDA up 75% YoY [10]. By Q2 2025 management noted that all three businesses had been **EBITDA-positive since H2 2024 and the company was accumulating cash every quarter** [3].

---

## 2. May–August 2025: The "Firing on All Cylinders" Phase

The year opened with the **Q1 2025 print on 13 May** alongside a symbolic move — the rebrand of SeaMoney to **Monee** on Sea's 16th anniversary, signalling that the fintech business had outgrown its payments-only roots and was being positioned as a stand-alone consumer-finance franchise [1]. CLSA's same-day desk note carried the title "**Firing on all cylinders**" (O-PF), with a follow-up "Singapore Internet (Asean E-conomy)" four days earlier framing SE as the dominant Asean internet platform [SA].

Operationally the setup was unusually clean:

- **Shopee**: GMV +22% with EBITDA $264M vs a $22M loss a year earlier; ad take-rate +50 bps YoY [2].
- **Monee**: $5.8B loan book +75%, revenue +58%, EBITDA +62%, NPL stable at 1.1% [2].
- **Garena**: Best quarter since 2021 (+51% bookings) on the NARUTO SHIPPUDEN collaboration [2].

Q2 (reported 12-Aug) reinforced every line. Group revenue **+38% to $5.3B**, EBITDA $829M, and the loan book grew **+90% YoY to $6.9B** while NPL held at 1.0% [4]. The Shopee VIP membership program — launched in Indonesia — was producing the kind of unit economics that justified a re-rating: **GMV from VIP members +50% QoQ, ~30% higher monthly spend, ~20% higher retention** [6]. Management raised **Garena's full-year bookings guidance to >30%** (from prior double-digit), citing the Free Fire 8th-anniversary Solara map launch and incoming Squid Game / NARUTO Chapter 2 IP collaborations [5].

Sentiment in this stretch was uniformly constructive: the long-anticipated "Asean internet flywheel" was finally producing operating leverage across all three segments simultaneously.

---

## 3. September–November 2025: Peak Sentiment, Buyback, Upgrades

Q3 (reported 11-Nov) was the high-water mark of the cycle. Group revenue **$6.0B (+38%)**, EBITDA $874M (+68%); Shopee EBITDA tripled to $186M; Monee revenue **+61%** with EBITDA +37%; Garena bookings **+51% YoY** and EBITDA **+48%** — Garena's best quarter since 2021 [7]. Management used the print to **raise Shopee's full-year GMV growth guidance to "more than 25%"** (from the prior 20%) [8] and announced EA Sports FC Mobile's launch in Vietnam [9].

The corporate-action layer amplified the narrative:

- **17-Nov-2025**: Board approved a **$1B share buyback program** — Sea's first sizeable capital return, signalling that management saw the cash generation as durable [17].
- **12-Nov**: **Deutsche Bank upgraded to Buy** with a $170 PT [18]; Wedbush kept Outperform but trimmed PT to $190 [19].
- **17-Nov**: **Phillip Capital upgraded to Buy** with the stock at $140.85 [SA pre-open].
- **02-Jan-2026**: **Maybank upgraded to Buy** with the stock at $130.64 [21].

The shares peaked around the **~$145 area on Q3 results** and held the $130–145 zone for much of November–December.

---

## 4. December 2025–March 2026: The Re-investment Pivot and Drawdown

The narrative inflected sharply at the **Q4 / FY2025 print on 3-Mar-2026**. The numbers were objectively strong — full-year revenue $22.9B (+36%), net income $1.6B (+260%), Shopee FY EBITDA $881M (vs $156M in 2024), Monee loan book $9.2B (+80%) [10][11][12] — but two elements broke the run:

1. **Q4 EBITDA of $787M came in below the $814M FactSet consensus** [23], the first meaningful guidance/consensus disappointment in the year.
2. **2026 Shopee guidance** explicitly framed the new investment cycle: "**grow Shopee's annual GMV by over 25% year-on-year, with its full year adjusted EBITDA no lower than 2025 in absolute dollars**" [13]. In a market that had been pricing operating leverage acceleration, "no lower than" implied a deceleration in EBITDA-margin expansion — the buy-side read it as a multi-quarter step-down in profitability cadence.

The reaction was severe. **Wedbush slashed its price target from $170 to $120** on 3-Mar-2026 while keeping Outperform, a ~30% PT cut on a headline beat — capturing the consensus-style downshift in 2026 earnings power [20]. The shares went from $130+ entering March to ~$88 on the print, and drifted to **$84-level by mid-March and again pre-Q1 2026 in May** (Taixue Group disclosed sales at $84.47 on 18-Mar) [SA].

The drawdown peak-to-trough was roughly **40%** — almost entirely a derating, with topline trajectory still accelerating.

---

## 5. April–May 2026: Q1 2026 Beat and Partial Rehabilitation

The **Q1 2026 print on 12-May** went some way to restoring the bull case but did not fully reverse the de-rating. Highlights:

- Group revenue **$7.1B, +47% YoY** — an acceleration from FY2025's +36% run-rate [14].
- **Adjusted EBITDA exceeded $1 billion for the first time** in a single quarter [14], and the reported $1.03B beat FactSet consensus of $794.5M materially [22].
- **Shopee**: GMV $37.3B (+30%); EBITDA $223M — slightly below Q1 2025's $264M, reflecting the deliberate spend on **delivery, fulfilment, ShopeeVIP and user acquisition** [Q1 26]. Management reaffirmed: "2026 is a year where we are leaning into growth investments to deepen our competitive moats, while maintaining financial discipline" [16].
- **Monee**: loan book **$9.9B (+71%)**, revenue +58%, EBITDA +14%, NPL still 1.1%; **Brazil crossed $1B in loan book** (+250% YoY), becoming the fourth >$1B market [15].
- **Garena**: bookings $931M (+20%) — Garena's best quarter since 2021; Arena of Valor delivered record bookings in its 10th year alongside Free Fire's Jujutsu Kaisen collaboration [15].

Shares moved from ~$85 to ~$94 on the print [SA Street Takeaways, 13-May-2026], suggesting investors gave management credit on growth velocity but maintained discount versus November highs on the deferred margin path.

---

## 6. What Shaped Sentiment and Valuation — The Causal Chain

| Driver | Direction | Where the market priced it |
|---|---|---|
| Shopee scale + monetisation (ad take-rate, VIP) | + | May–Nov 2025 re-rating |
| Monee loan book compounding 70–90% with stable 1.1% NPL | + | Continuous through year |
| Garena Free Fire revival via NARUTO / Squid Game IP | + | Mid-2025 guidance raise |
| $1B buyback authorisation | + | 17-Nov sentiment peak [17] |
| FY2025 Q4 EBITDA missing consensus | – | 3-Mar derating [23] |
| 2026 Shopee EBITDA guidance "no lower than 2025" | – | Multi-quarter compression of forward EPS estimates [13] |
| Q1 2026 record $1B+ EBITDA + Brazil acceleration | + | Partial recovery to $94 [22] |

The crucial macro point: **operating execution was linear and excellent across the entire year** — every quarter delivered higher GMV, larger loan book, growing Garena bookings, stable NPL, and improving conversion / take-rate metrics. The valuation cycle was driven not by results but by the **second derivative**: a perceived shift from "harvest mode" (the 2024-H1 2025 thesis) to "re-investment mode" (Brazil fulfilment build, ShopeeVIP partner roll-out, AI investments, off-Shopee SPayLater expansion). The buyback announcement and Q1 2026 record EBITDA partially reanchored the bull case, but the November 2025 levels remain a sentiment ceiling the stock has not reclaimed.

---

## 7. Internal Research Lens (CLSA)

CLSA's coverage in the corpus is concentrated **May–June 2025**, centred on the bullish "Asean E-conomy" framing — "Sea Limited - O-PF (Firing on all cylinders)" (14-May-2025), "Singapore Internet (Asean E-conomy)" (5-May and 20-May), and inclusion as a top single-stock idea in "Singapore strategy (Strength in defence)" (25-Jun-2025). The CLSA file does not appear to be updated past that mid-2025 vintage on SE specifically, so the H2 2025 / 2026 narrative shifts above are sourced from public transcripts and broker action via newswires.

---

**Sources**

[1] Sea Ltd., Q1 2025 Earnings Call — 13 May 2025
[2] Sea Ltd., Q1 2025 Earnings Call — 13 May 2025
[3] Sea Ltd., Q2 2025 Earnings Call — 12 August 2025
[4] Sea Ltd., Q2 2025 Earnings Call — 12 August 2025
[5] Sea Ltd., Q2 2025 Earnings Call — 12 August 2025
[6] Sea Ltd., Q2 2025 Earnings Call — 12 August 2025
[7] Sea Ltd., Q3 2025 Earnings Call — 11 November 2025
[8] Sea Ltd., Q3 2025 Earnings Call — 11 November 2025
[9] Sea Ltd., Q3 2025 Earnings Call — 11 November 2025
[10] Sea Ltd., Q4 2025 Earnings Call — 3 March 2026
[11] Sea Ltd., Q4 2025 Earnings Call — 3 March 2026
[12] Sea Ltd., Q4 2025 Earnings Call — 3 March 2026
[13] Sea Ltd., Q4 2025 Earnings Call — 3 March 2026
[14] Sea Ltd., Q1 2026 Earnings Call — 12 May 2026
[15] Sea Ltd., Q1 2026 Earnings Call — 12 May 2026
[16] Sea Ltd., Q1 2026 Earnings Call — 12 May 2026
[17] MT Newswires — Sea Board Approves $1 Billion Share Buyback Program (17-Nov-2025)
[18] MT Newswires — Deutsche Bank Upgrades Sea to Buy, PT $170 (12-Nov-2025)
[19] MT Newswires — Wedbush Trims Sea PT to $190, Keeps Outperform (12-Nov-2025)
[20] MT Newswires — Wedbush Lowers Sea PT to $120 from $170 (3-Mar-2026)
[21] StreetAccount — Maybank upgrades Sea Limited to Buy (2-Jan-2026)
[22] StreetAccount — Sea Limited reports Q1 adjusted EBITDA $1.03B vs FactSet $794.5M (12-May-2026)
[23] StreetAccount — Sea Limited reports Q4 adjusted EBITDA $787.1M vs FactSet $814.2M (3-Mar-2026)

[SA] = Additional StreetAccount headlines surfaced in search but not separately cited above include: "Sea Limited upgraded to buy from neutral at Phillip Capital ($140.85)", "Street Takeaways - Sea Limited Q3 Earnings ($145.13)", "Sea Limited holder Taixue Group Ltd. discloses sale of 1.3M shares ($84.47)", and the CLSA RMS notes "Sea Limited - O-PF (Firing on all cylinders)" (14-May-2025), "Sea Limited - O-PF (Business update first thoughts)" (13-May-2025), and "Singapore Internet (Asean E-conomy)" (5-May / 20-May-2025).

## Citations

- [1] **Q1 2025 Sea Limited** · external
- [2] **Q1 2025 Sea Limited** · external
- [3] **Sea Ltd. , Q2 2025 Earnings Call, 12-August-2025 7** · external
- [4] **Sea Ltd. , Q2 2025 Earnings Call, 12-August-2025 7** · external
- [5] **Sea Ltd. , Q2 2025 Earnings Call, 12-August-2025 7** · external
- [6] **Sea Ltd. , Q2 2025 Earnings Call, 12-August-2025 7** · external
- [7] **Sea Ltd. , Q3 2025 Earnings Call, 11-November-2025 7** · external
- [8] **Sea Ltd. , Q3 2025 Earnings Call, 11-November-2025 7** · external
- [9] **Sea Ltd. , Q3 2025 Earnings Call, 11-November-2025 7** · external
- [10] **Sea Ltd. , Q4 2025 Earnings Call, 3-March-2026 7** · external
- [11] **Sea Ltd. , Q4 2025 Earnings Call, 3-March-2026 7** · external
- [12] **Sea Ltd. , Q4 2025 Earnings Call, 3-March-2026 7** · external
- [13] **Sea Ltd. , Q4 2025 Earnings Call, 3-March-2026 7** · external
- [14] **Sea Ltd. , Q1 2026 Earnings Call, 12-May-2026 7** · external
- [15] **Sea Ltd. , Q1 2026 Earnings Call, 12-May-2026 7** · external
- [16] **Sea Ltd. , Q1 2026 Earnings Call, 12-May-2026 7** · external
- [17] **Sea Board Approves $1 Billion Share Buyback Program** · news — <https://my.apps.factset.com/viewer-fusion/?_doc_id=A3506528&_doc_date=2025-11-17&_doc_product=MNW>
- [18] **Deutsche Bank Upgrades Sea to Buy From Hold, Adjusts Price Target to $170 From $165** · news — <https://my.apps.factset.com/viewer-fusion/?_doc_id=A3503630&_doc_date=2025-11-12&_doc_product=MNW>
- [19] **Wedbush Trims Price Target on Sea Ltd. to $190 From $200, Keeps Outperform Rating** · news — <https://my.apps.factset.com/viewer-fusion/?_doc_id=A3503655&_doc_date=2025-11-12&_doc_product=MNW>
- [20] **Wedbush Lowers Sea Price Target to $120 From $170, Outperform Rating Maintained** · news — <https://my.apps.factset.com/viewer-fusion/?_doc_id=A3577190&_doc_date=2026-03-03&_doc_product=MNW>
- [21] **Sea Limited upgraded to buy from hold at Maybank Investment Bank** · news — <https://my.apps.factset.com/viewer-fusion/?_doc_id=sa_story_4511785&_doc_date=2026-01-02&_doc_product=SA>
- [22] **Sea Limited reports Q1 adjusted EBITDA $1.03B vs FactSet $794.5M** · news — <https://my.apps.factset.com/viewer-fusion/?_doc_id=sa_story_4674662&_doc_date=2026-05-12&_doc_product=SA>
- [23] **Sea Limited reports Q4 adjusted EBITDA $787.1M vs FactSet $814.2M** · news — <https://my.apps.factset.com/viewer-fusion/?_doc_id=sa_story_4584648&_doc_date=2026-03-03&_doc_product=SA>

