Sea Ltd Shares: What Asian Tech Investors Need to Watch With Its Q4 2024 Earnings

TradingKey - E-commerce is a big business globally. But in emerging markets, like many in Southeast Asia, it’s still growing at a rapid pace. That presents exciting investment opportunities.

One of the biggest e-commerce players operating in the region is Singapore-based Sea Ltd (NYSE: SE) – which runs the Shopee platform but also oversees a big online gaming business as well as a burgeoning fintech platform.

With e-commerce continuing to show strong growth in the region, Sea shares are up a whopping 136% in the past year and have advanced 21% so far in 2025 – easily beating the S&P 500 Index on both counts.

With Sea Ltd set to report its Q4 2024 results on Tuesday (4 March) before the market opens in the US, what should Asian tech investors be watching?

Can Shopee continue its robust growth?

As ever, with Sea Ltd, the key focus will be on the company’s core e-commerce business of Shopee. Its strong growth in recent quarters has been the primary driver of the uplift in Sea’s share price.

In terms of its Q3 2024 earnings, which came out in mid-November 2024, Sea posted revenue of US$4.3 billion, which was up 30.8% year-on-year. Meanwhile, total gross profit was US$1.9 billion, or an increase of 29.1% year-on-year.

Sea is also turning more consistently profitable. Its Q3 2024 net income amounted to US$153.3 million, a stark reversal from the US$144 million loss in Q3 2023.

Under the hood, Sea’s e-commerce business saw revenue surge by 42.6% year-on-year to US$3.2 billion. As a result, Shopee actually expanded faster than the overall business and now makes up nearly three-quarters of Sea’s total revenue. 

Encouragingly, gross orders totalled 2.8 billion for the quarter, an increase of 24.2% year-on-year. Investors will be keen to see that Shopee can continue this strong growth – both on the revenue and orders fronts – for Q4 2024.

Can gaming keep it up?

Sea’s most profitable business unit, from a margin perspective, is actually online gaming. With its Free Fire mobile gaming hit, the company has been able to fund growth in its e-commerce and fintech units. For Q3 2024, the Digital Entertainment (or gaming) business saw bookings of US$556.5 million, up 24.3% year-on-year. 

More importantly, quarterly paying users rose to 50.2 million and was up 23.9% year-on-year. The Free Fire game was actually the most downloaded mobile game globally in Q3 2024, a testament to its enduring appeal. 

What is the market expecting from Sea?

In terms of estimates for Q4 2024, analysts are pencilling in revenue to come in around US$4.84 billion – representing 35.8% year-on-year growth. That would be an acceleration from the most recently-published quarter (Q3 2024).

For e-commerce, revenue estimates are at US$3.59 billion which represents 35.6% year-on-year growth. Meanwhile, revenue for digital entertainment is expected to be US$513.9 million, up around 0.6% year-on-year.

Investors will also be watching Sea’s third arm – Digital Finance Services – to see whether the company’s loan book is growing in a healthy manner. In Q3 2024, its consumer and SME loans principal outstanding amounted to US$4.6 billion, up an impressive 73.2% year-on-year.

Short-term performance of Sea still rests on Shopee

If Sea can continue to grow its three businesses at a healthy clip, then the rally in shares could continue. Remember that Sea also maintains a robust cash position of US$9.9 billion as of the end of Q3 2024 so the firm also has room to expand and invest for future growth if necessary.

For long-term investors who hold Sea shares, expect a big move up or down and for this to be based on the performance of Shopee’s growth and profitability profile. 

With Shopee starting to move into positive adjusted EBITDA territory, from huge losses in prior years, the acceleration of profitability could well be a positive catalyst for shares.