Sea Limited (SE) 12 Nov 242024 Q3 Earnings call transcript

Good morning and good evening to all, and welcome to the Sea Limited Third Quarter 2024 Results Conference Call. [Operator Instructions] And finally, I'd like to advise all participants that this call is being recorded. I would now like to welcome Mr. M.C. Koh to begin the conference. ahead. go Please

inherently welcome for Call. and On XXXX Quarter our realized which Third call, and release. and Hello, not press reasons may am to as M.C., Conference be are statements, forward-looking I may the Director. to Sea's Earnings risks we uncertainties future everyone, in make Sea's subject various Investor this in Relations stated

measures EBITDA. can certain of our Also, to this as We financial such the believe as the a disclosures. these of businesses of call understanding non-GAAP adjusted flows our enhance measures investors' discussion complement cash when GAAP includes actual our major used

discussion release. with non-GAAP section a measures on the GAAP financial measures to non-GAAP and the our in the For financial reconciliation press use measures, of of closest please refer

and I Feng; Chris Chief Li; with Sea's have me Executive Officer, Forrest Tony President, Chief Financial Hou. Officer, and Chairman

and performance be quarter operating any will updates, highlights share management questions by you a financial followed XXXX. strategy of which Q&A session, have. and we Our in third welcome business This the for will

With that, the let Forrest. over me to turn call

Hello, another and quarter. has to it report thank been I'm joining you that call. everyone, today's happy solid for

our We this quarter GMV while track guidance are of by XX% year-on-year high growth. grew over ratio. X growth mid-XX SeaMoney's our maintaining full businesses. all stable seeing Shopee on year-on-year deliver is across to year loan NPL book a

expect Free getting improved I'm while we full our now year-on-year. also growth. very grow to for And we XX% high back bookings that Garena, Fire's year to proud over profitability

expect to as we in EBITDA delivering remain adjusted profitable Asia continue growth positive Brazil on forward. achieved and Shopee quarter, This going to focus Shopee we both

third and detail. monthly Asia strong take leadership volume XX% over business' the you our order quarter in market buyers year-on-year. delivered that, Starting growth market. GMV strong through active more remains with User each With e-commerce. average quarter, growing this strong Shopee by let sustaining has with in in performance me growth

this rate. quarter. Southeast led both We our take in improved in further have to commissions, monetization in has On advertising rate industry-wide commission increases market take rationalization commission and Asia

set On more the traffic their paid ad their introduced it ROI of seller for attracted helped achieve allocation simplified improvements our a to see ad ad better advertising, ad sellers benefits This We spend returns our spend and and easier features. optimize driving it, sellers algorithm dashboard, our ad target. on and onboarding, sellers our adoption the for of offerings. tech making to up both

quarter, per XX than has ad XX% increased third sellers Shopee's over same ad-paying basis we quarter the here. year, much and take points, over more ad-paying by and by upside last see revenue improved by XX% rate the Compared In seller year-on-year. increased to more

our priorities front, is committed be improving operations quality the competitiveness, our It buyers. mind bring users. we On X Shopee to same to that key and continues deepen of we the service share our our enhancing strong to brand to content competitive mode, remain Price a competitiveness proposition price anchor ecosystem. value a strengthening our among

structural given by end-to-end market Asia investing advantage Portrait, highest and quality, platforms our peers. recent has Brazil. prices service Shopee a our a conducted the for us in integration vital good In over among survey in product our score partners logistics across On e-commerce received logistics and

savings the happy to service the on with them to better cost are passed able are we provide. customer buyers we Our and

to solutions access appreciated we give Our logistics cost-effective are reliable as one-stop both that efficient. sellers and -- them also

It placements. order our Asia quarter, cost become were logistics SPX speeds quarter-on-quarter has days extensive be of Cost per service to in and half both SPX continued factor third in and Express orders Express Asia within leadership. differentiating in also Brazil. the order In in leading of particular provider delivery delivered improve coverage, X continues key a with us. market to faster a for

format also the to side on the have popular continues made supply both We significant progress market. on demand the Live in front. our ecosystem and a be content streaming

year in in the half division building off. has streaming Our second capability of live to last invest paid Shopee's

both in economics. unique third over on over the basket streaming our consistently streamers increased streaming driving grew In quarter, XX% the over size the live few average buyers quarters, daily live its daily and grew unit has unique improvements Average XX%, past quarter-on-quarter.

effort market Asia. content in successful particularly been has in Indonesia, largest Our our

and been of steadily We live since unit start order our streaming economics and have the the largest has there GMV XXXX, volumes both improved then. by platform e-commerce since

boost recent Shopee been efforts Indonesia. and YouTube to new our has in between a content One collaboration

embed now buttons directly. allows videos can Shopee items buy viewers their to creators that YouTube clickable in from

We have and markets. into partnership more collaboration extending to just this as forward Vietnam and look Thailand brought strategic this well, to

quarter, Looking grew good beyond buyers year-on-year. In average third Asia, monthly XX% coming close to are we active also Brazil. out by the results of seeing

We X new to and on there. best site with are better than an having adjusted Award, consumers on which in shopping first the among Brazil been this Brazil. share further user purchasing about in unit feel market break the time basket the mind investments only This in Shopee are the Top-of-Mind opportunities even economics. giving than see as bigger Despite in for sizes growth to We very our Shopee's recently years, the us cohorts, best cohorts recognition encouraged that improving returns older Folha excited brands EBITDA ever. recognized allowed less basis us received

Asia show rate. penetration have a that continue our markets as In summary, very grow position great to still with Shopee I'm to of to low strength happy e-commerce both e-commerce very This Many in us puts continues improve. and Brazil. in penetration the

digital to turning Next, financial services.

momentum We both continued revenue delivering our quarter, in EBITDA. double-digit strong growth year-on-year and this

continues Our key but credit in to is growth high which demand, underserved still lending be market. in driver of very our

also users. for and to efficient allows to credit it market us makes risk. highly better acquire underwrite Shopee user base us serve large Shopee's from data in our Proprietary

retail that we addition, diversified us give sources innovative in our asset-backed funding give markets lending such access and as products have deposits. us that digital to banks local In

All has scale up quickly business and of very led to this our profitably. us credit

In the we grew loan third borrowers. And first-time over XX% year-on-year. X added book our quarter, million

reached held X.X%. million year-on-year. active and Our end growing growth, by loans consumer the our XX% in about of high the users than ratio Despite XX SME quarter the third NPL quarter, XX-day more at stable

size them our offering risk Shopee longer and tenure options credit tenure track SPayLater as such and healthy credit gradually is users limit increase limit, offer and We One a on higher offerings small record, borrowers the with other cash If of underpins loans. their engage purchases. tenure short by show practice healthy practices first-time credit loan typically users. to management a sustainable repayment growth. to our products we products, This

users. loans tenure we Right $XXX a base retail have to strongly, was products very well These now, SPayLater purchases in example our average One of few of loan use mobile growth book in stores. case, less is higher especially half outstanding our credit off-Shopee users more now months. offline received of credit In was with period limit by for loan select spread case there. off-Shopee book loans a Indonesia. loans offer consumer ticket just markets. user very than this we than per been large over facilitate This extra pushing more are an initiative user with recent large Recently, of phones account our different across Off-Shopee limit.

explore to bring continue Indonesia this will in our other We cases further markets. use and success to

beyond our market. ahead we in see opportunities unique of are Shopee a compelling. us gives Strong use very growth cases plenty summary, and also In Shopee with synergies advantage,

our in markets. We are positioned the offer business well services credit address more to and to underserved huge grow demand our financial

Free to largest the one representing the quarter, year-on-year million is to over active quarter. be strong users good continued Total Fire an world. grew year-on-year. growth Garena's into mobile Free grew This business. impressive XX% turning of our bookings XX%, third entertainment and driven in growth. which by has daily third had over strength adjusted continues games digital XXX in the of XX% Finally, over performance EBITDA consistently Fire, the the

In the untapped ramping this region both and over opportunity sizable and we year. up top such We past North campaigns to addition in the other were meaningful regions, been Americas, in-game to as game this events a happy all view growth Asia market. has and as see Africa in

North e-sport a in We Africa. believe event held where had game teams millions we of largest tournament ever major mobile of attracting social in Morocco, on Recently, attending the off-line participated, it thousands media. views was

#X to to in Our number Tower increase Sensor up level. high. was quarter quarter, again users. while and as also top update. third the continue to users and ranked Free a Fire of mobile In ARPU played keep The And the for engagement most our healthy during at new the engaging thanks this always Free quarter, the we downloaded who sales downloaded year-on-year. in Fire be an saw attracting, has campaign Fire Free our priorities third once item game world. anniversary try the strong retaining XX% remained User We

markets and sure of updates our experiences are game and quite trends. media seasoned inspired keeping lot these this release do very vintage steadily, gamers. its for has relentlessly fresh things believe and Fire to Free is a I It with updates even a Many remarkable local make approach. content our in-game of able new grow to user to frequently, by that so social is user-centric We base

collaborate the Fire into October, part the baby geological organization was Free of Moo hugely pygmy the bring first popular Thailand hippo, game in game. world Deng, with In the their online to to

highly introduced viral shared one how million social we generated making is that leverage virtual This them items Our helping also keeps more and on emotional feel social an level, themed Fire to with views. than interesting. connect XX that content on in users new we Free went relevant join They trends users. visible that media is hippo of love users example Fire Free Free local the to just Fire. yielding user It media, at

in for Beyond most Tower. Free the at all Taiwan, ranked launched racing end Mobile Sensor Kong X to game markets according Macau downloaded of in launch, Need the #X Hong October. it its has and Garena Fire, as Speed Since

America. strengthening bring users in to are several a across mobile Asia, Latin tactical game, PC and MENA partnership our to also We and with shooting Delta first-person Tencent Southeast markets Force,

quarter strong posting we businesses happy with very profitable a all conclude, To that our high I'm of growth. X delivered

your continue We have you, done always, so. Thank will we as and doing well, for support.

I Tony our to financials. invite that, With discuss

the and thanks joining Forrest, call. to you, for Thank everyone

growth For increased was driven Sea GAAP to XXXX. e-commerce of the primarily third of XX% year-on-year our business overall, digital and financial the total by in billion our This revenue of quarter growth business. GMV services $X.X

of quarter million XXXX. was an quarter of XXXX the in adjusted million $XXX the EBITDA EBITDA third of to adjusted total third $XX Our in compared

XX% On grew e-commerce, XX% by Shopee's gross year-on-year. orders GMV and increased

Our $X.X revenue revenue GAAP $X.X of billion, year-on-year, and included third billion. GAAP up revenue quarter GAAP billion XX% marketplace of of product $X.X

and logistics core revenues mainly up billion, billion, year-on-year. related revenue, revenue, services of XX% marketplace Value-added advertising consisting marketplace GAAP Within transaction-based $X.X up mainly revenue, was XX% year-on-year. consisting revenues of fees services was $X to

in XXXX. compared E-commerce was EBITDA of million adjusted of loss an third EBITDA $XXX million the to XXXX third of in adjusted the quarter $XX quarter

we $XXX of EBITDA achieve loss third quarter million adjusted market, continued quarter, XXXX quarter of compared following during our Asian of our For million $XX second the to results, adjusted positive an the in recording XXXX. to EBITDA

XXXX. in In the compared up to up $XXX XX% Adjusted to adjusted EBITDA adjusted million $X financial third to year-on-year positive our by achieved we revenue $XXX year-on-year of million of EBITDA loss markets, an XX% services million. quarter GAAP million. was EBITDA was by of $XX Digital other

days percentage reached year-on-year. loans billion, of of end outstanding was loans Nonperforming September, outstanding. $X.X by and $X.X consumer of end on consumer total SME SME at of the X.X% and and XX% the billion This a past than the our billion XX more off-book of book due up quarter. loans As $X.X consists loans principal principal as

of the million. in nonoperating the million in income million third quarter was Digital net a to third $XX million. compared expense quarter EBITDA $XX entertainment of million XXXX third income million was in net income of the XXXX bookings of of to expense recognized quarter had were We a Returning a compared numbers. of $XXX $XXX $XX to GAAP income We the net third revenue of tax XXXX. consolidated in our year-on-year. up net Adjusted XX% $XXX $XX million, quarter nonoperating XXXX. tax of

a the income third as million was quarter net $XXX third net loss As XXXX. to of compared XXXX result, million quarter of of a in in $XXX the

ready to Tony. you, questions. to Thank call We're open now and the Forrest Operator?

Pang of line the from comes with question Vitt first Goldman The Instructions] [Operator Sachs.

increasing in with Congratulations fourth for could you me, us of that one, from competitive see landscape rate while quarter presence more expanded take you competitor regions. Number noticed social Two competitor results. the be that questions set latest insight your provide its into the e-commerce. will We the been the solid commerce noticed also its has currently? both that cross-border we on in the

provide line? overall take on exactly we #X, you some would see basis the both And and about XX that ramp-up seen how process? of think the uptick this be you points around quarter-on-quarter they've strategies? But growth for That's rate for it allow Can a this will also have projections you and terms bottom potential question top ad impact differently could us advertisement progress? provide you advertisement. to the So the nice timeline rate. your how insight what that share you #X. Question it to done in comments in related -- take ceiling the Can do the notice and do that

growth, on improving growth our as landscape. quite think while fact, at as you EBITDA And mentioned in in stable are our has Asia look both our if landscape, I Brazil. possible a doing opening, to been and do competitive be see we competitive far well, in the we the

look with that our this well all our quite see we're for we QX in, doing do If you is the still growth environment GMV year. guidance and mid-XXs we competitive at maintaining are QX,

local our our products, we before, As of shared are market. majority local sellers selling

relatively at stage. us this small impact the from to probably consequence, cross-border competitor a As

If ads rate, ad there take improvement we rate. meaningful of at look take a the is

If on quarter, about year same last take compare the you X.X% the to we grew side. rate ad

few a doing a the revamp did a We to can We ads from query. return a we ad place investment particular our for better sellers. Part deliver the of improvement algorithm how can well perspective. consequence improve have systems comes ad done user's past sizable the rate rate we actually, our we a over take many as technical to things, conversion have quarters. By from that, better the to to that

when we traffic versus We algorithm also terms ad our tried the improve the so our ad to of to have flexibility ad in displaying buyers. for can more utilization to display that products organic

the ad On top experience sellers ad of the product improved buyer seller also the to to we that, easier side -- utilize sorry, make products.

help that using our the more also us have in have, see are which our improve turn, their can the there in that we ad end users' pool day which we consequence, pool easier and the our increased a of products, that because As to are match ad, the efficiencies more queries. sellers bigger to can products we in ad the we of the

the is We the the improvement going believe that of to in quarters. ad continue potential next product few

it's the think would I comment early what too be. on to potential ceiling

technology, and our to in, improvement improving markets sellers impact improvement we our to all and I out countries. also the while rolling we the quarters come further will coming are will products the out across the rolling in think the see new

line with Citigroup. Our next comes Yap from of the question Alicia

e-commerce. Congrats follow-up I results. on the questions strong to have related

Asia balance they been good into Temu Shopee the profitability? Vietnam versus launched recently. we market So how tractions do actually the then observed the be more share competition and picks XXXX? how growth that competition Southeast in XXXX, interest as that and intensified the Shopee we related resilient we If even a recently given in gaining about Brazil just economic Southeast entering If environment especially would the should for head lower pretty you And is given so, up, growth also has though rate Asia? management to anticipate in thinking also growth that

appreciated. color would be any So

probably I think early a on comment the XXXX. too to it's bit

coming the I think we're better monitoring QX, still will probably guidance trend provide the in in and we in XXXX quarter.

we range, Number to in would think grow think we X as as is, like general, way to fashion. sure a we is grow about much we profitable make like can profitable But in possible. would we the the #X, this

next kind when quarters. about terms into we that's we few the think of it of come I probably think how in

competition, we seeing mentioned South of I stable in terms as a Asia. competitive environment relatively earlier, In are

didn't see in competitive environment, any Brazil, particular In changes the we either.

to businesses, do has that certain coming of the we As market players a believe that as see through a part you business cross-border been given and mentioned, relatively of been has small a model, our we part cross-border our overall market cross-border small well.

look good advantage impact offering, platform, we you at those those products product that to competitive the So are still pricing Even in players you relatively relatively platform. will be to limited. in those the compare pricing see if the a us products for our our cross-border

that there's price too it we the on change much. dramatic players, from our in platform purchase these a will don't So competitors impact preference buyer's they that on sense unless that how see

next Our John Choi Daiwa. from comes of the question line with

a I here. on results. have Congratulations Okay. solid set of X questions

the latest Brazil? the all, on going we key what is noticed reduce that is near-term of reducing by and have I And driver First you've Asia for shipping the percentage orders started our what forward? is think in question handled SPX cost of our what first and logistics the is, the target order? per subsidies, to

economics. question second your my And about is unit

raised this if a further think stream for the merchant rate streaming, versus look the our our the peers take What economics you long-term. in and live feedback increase unit is timeline live area? at the after I in Shopee of

platform. we coverage and SPX SPX, we how On are to the SPX that deliver mentioned, percent the Shopee that also as much increasing

-- And also In more the in grow, general, X in increasing half are working parts Asia. we and are more for thing that have days few within of cost the all XX% we coverage, believe, doing value hard Asia, quarters. increasing to continue if now Brazil, than than different these more chain. but and to we The the cost and orders not coming XX%, only we of you look probably the next at quality reducing reduce the key both delivered SPX from than on in the

For well sellers the management, prepare we can of And working example, of involves our look we first match can that the pick the are hard miles, how to their part management products. for sellers from products if the how at costs part well and seller fleet between the the up you side. from

our the make If to productivity. that center you also the sorting we're compensation automations in and sorting that has in the sure at the workers increasing linkage look the we centers our a sorting of manage centers, the to percentage closer way

If you a look line of improving sure on how at haul to utilize all can line was spending better utilized lot quite make haul, the trucks are we're it before. the than well effort we

you many also a efficiently package the mile formats on rider have the is more the more of fixed We're on in deliver more the management innovating them can also traffic thing, figure based can logistics out we remote a last hubs and orders hubs are Another lot the the last improve patterns than we by hubs efficiently last to we mile our the on to imagine, mile usually last the sequence we lot last and user mobile using for important behaviors. mile more have. have. helping one different to route how technology them helping that as In area, mile more very that based

Yes.

value all it's it's So across that the logistics. one only chain the thing, again, have we not end-to-end for probably

live The slightly over -- in probably in -- penetration economics economics, be relatively order you meaningfully of a have to stream orders live that to of unit terms all actually stream economics as unit compare quarter-to-quarter, do unit stream and long-term, as shared the probably our look will generally -- has has In And will come the it our percentage continue at good across we live we our live believe you if platform streams, -- to we similar economics -- economics. been unit before, our percentage the our if to increased quarter-to-quarter, to has improved the the markets. of the time. improve competitors platform terms for you if

don't we For the the of have take rate increase, fixed in timeline take increase. terms a rate

lot we seller take delivering I ecosystem we trying a more think increase ecosystem that make balance we spent whenever rate, our are partners. effort the our of to value sure to to

to So and it's evaluate the will our we ecosystem continue something from hear conduct adjustment. feedback before we any

comes from line question with Jefferies. the Thomas next of Our Chong

My payment soon? about questions. first comment about the Can any X is business. have coming cycle Free and I to games management Fire new expected question life be

And quarters? my impact investment management e-commerce the about in side. EBITDA some this provide second question on updates margin logistics spending the on coming and Can is

like for that Fire, see after headwinds are some we of excited like, Free Sure. face, challenge especially the growth Like terms the in we the to very situation. like is post-COVID

think user-centric X the very to very, years we have to and start payoff. improve through the I like continually past in very we the product been approach, trying hard see the

life results whole like this believe, of We like Fire a terms mean, more Free start the pretty always Fire, a like a more it's the to the instead and as year see -- great the trend much service of beginning for is the like Free we platform extending been I the year. product. of for And and has cycle. in the

up And game sign. and see conviction So Fire ambition evergreen platform. evergreen the very we an as Free have a from that this a the as do -- to we perspective, and build encouraged is

user think has been accelerated. is about new the And like into if and the growing. game, even coming a it's growth Fire years, And game, the X still you old users Free new

So see we better -- engagement we see those, retention. from and and better all the the

from those is that strong it's a very, very, and Fire a Free at still very stage. early all very metrics, So sign

and through the engagement, the and making engagement the it's better local to I fresh, with as confidence grow through experience keep friendly better well. time, always for the through gamers give new think same -- intention At more a the the existing game, it game users. to keep and continually have the content the the to us a

the from HSBC. with Our of Rishabh Dhancholia next comes question line

moment. a for pause please Operator,

us has moment question Give here. second been not yet. The a answered

question on the second investment. questions, Regarding logistic regarding the the

than our the around investment and and machines CapEx more rather it's hub sorting The centered driven OPEC-driven rather the sorting logistics businesses. centers. heavy to For core the is improvement our businesses, to capital part of

So counted sense SPX well. as build as of to our and relatively of part it's that a part our the businesses EBITDA overall in that smaller spending is overall

that the significant So from be margins the impact there see will to this EBITDA a don't we from -- perspective.

Let's proceed for next question. the

We Dhancholia with have Rishabh HSBC.

right. All

proceed So let's the for question. next

have We Kothiyal with Divya Morgan Stanley.

So just if at a XX% question e-commerce my is quarter-on-quarter percentage driven what's of sales basis. the you look first on gone explain in GMV by Could the growth as well, the business. And about it's and marketing up we as expense? slightly it XX

Just marketing if think comments and on to to number? year When these being off. coming how we outlook And triangulate on your do about you this can any expect start sales stable. for this competition expenses with next

then we been a actually But a quite out? being you And DFS company more the general approach the how -- on the been specific has quarter, sense measured growth? have was growth. initiatives say growth on in And what question to I growth drive the being was beyond business the on mean is this accelerated Indonesia talk that panning business. that taken is taken this the second the got DFS we growth the really bit. Could

the sales are that first question, there marketing the might things especially in For X QX. impact and growth, typically, so

the on one at look I you if growth our revenue growth, as well. is side meaningful a there think revenue is

from side way seller rate. the take a bit the on the we that in So take more

sales that we take spend that, make the a see we when marketing of more our seller will compensate typically, some we and on So rate increase sure bit to side.

think that's one. I

Second one is QX.

for is you more a season date. season if more year this where If you is the relatively QX promotional compare with QX QX, e-commerce, account lower

core X the reaction to a sales that's drivers for the marketing competition than side. rather movement think I and the

question The financial -- service businesses. on digital the the regarding second

seeing Indonesia, in are growth only markets. but in other We the also not

penetration example, Shopee see see also, in We Malaysia. well we good on early late. For started very Brazil growth And market, from see where our relatively we the SPayLater penetration Thailand, signs meaningful we of products. in

through the growth that Shopee So for penetrate various we part driver of users the formats. more is

users to more digital take can financial we side. one. service That's So our

existing is the products one optimize users. Second to we our

cash and if we more lot a example, both For pricing. SPayLater our you products, risk-based loan our at are look doing

type users. products a also more to We our provide target new of prime

launched a users in of term some to can For prime build needs user spent address use example, quite that we we -- loan top On effort make also Shopee to the to to that, their as more Indonesia platform. cases sure go we scenarios, target well. beyond

For example, opening rollout Indonesia, QR shared National in as for through SPayLater the the we Philippines, Malaysia same initiative rolled the payment we code, out in in off-line in the the as have we that well.

We also et home the offline, use for cetera. cases and the rolled like SPayLater the out specific cell phones appliance,

us to more services the next to few All will this user and of those grow continue for while are to in Some for users. broader of to penetrate cases those financial digital more we help the quarters will expand segment expanding to more users countries those a cases. and use products

HSBC. Our Dhancholia Rishabh next from question with again is

segment outlook segment this undertaken user growth What growth -- to are in your initiatives various the deepen are of questions, what DFS the please. segment? DFS drive penetration products? for margins And And each Two for across key secondly, in segment priorities and in in XXXX?

there For key perspective. our the a for is macroeconomic -- priorities XXXX marketing from strong the entire very in so and very, all, potential. strong growth And tailwind feel like and the we

would very So overall, very we will mindset. very, a each -- maintain a jump in growth without say into strong still specific I very, and

be will the growth focus. so And the

have we like this momentum a very, at -- so moment. very a And strong

we this quality also see We of like meanwhile, And mentioned, moment. continue If this our you trend the all on will very hope as X focus growth business good the is trend into XXXX. is rate, to on we only well. And growth. our the very X not stage deliver like for as got the and but a to with the growth strong growth kind of think foundation high the have all profitable business at I

So terms that of very big XXXX. the broad will be the picture for sense -- in priority a the in

previous the the the you CMS of Yes, we shared in I as now user penetrating questions, to if at Shopee the businesses, look part are further base. just

are building of users more users optimizing more cover our and ecosystem product also our serve to better. outside use in We our cases ecosystem to Shopee

will think the over year, in any margin countries in our shift don't I in. in growth for we or next observe this other quarter We next businesses trend only contribute have that particular few but service not also terms quarters. of financial to the all the for Indonesia, many

Our line JPMorgan. with the next Ranjan comes from of Sharma question

questions my Two side. from

presume penetration growth the is thoughts that profitable corollary e-commerce. And could out your the in Shopee Asia? share on centers you Brazil, at with is left of Firstly, us high of around quite much profitable how further like in Asia? expansion the Southeast already to major because in that is Can becoming Asia we urban you Southeast look

The is money on there is need sheet? close to your a are billion to How do capital the second keep Or investments, back now. $XX case and question which some for much to to shareholders? you cash you return on balance the

is our that we with lot of penetration of if more there still if advanced can room markets, terms In you a we at e-commerce the the market. e-commerce grow see current quite e-commerce in we look penetration, that benchmark major

like, we believe that look the driven you that cities, the Part in penetration the penetration at at be of meaningful Java Jakarta we Java around do Jakarta if cost look Even Java. versus to even look if a that e-commerce the there's other versus Java outside in room will way, the top-down example, the area by at see we that Jakarta, do city, be. grow potential cities, So still are doing. in in market overall, in for of will optimization you Indonesia, or of meaningful

deliveries, for the and improvement service better are by e-commerce will SPay like from buying that come experience example, of our from further a on. part cost working the of For we reducing that

of Part population, progressions better older, be of so will by that natural driven power. younger of were getting the slightly population have they the some purchasing

users be time. try And and e-commerce who -- more some frequent of don't the use before, the e-commerce over they will purchaser other

believe we in So penetration. in terms the all, room do meaningful there's still of that

huge in a which the our have have particular potential outside hard Asia too we anything expansion besides don't we there. of to In right near-term, core Brazil in But say, there near-term, it's believe now. plan the right very do we the let's out For is Asia, long-term. of the next, any is what predict now, market

value In is on for like maximizing shareholders the of terms and always start location, our with of value things mind. our to top the capital creating

And our we there to options create all how to buyback is look remain mean, at value where actually, very well. one other for value, So open-minded. the definitely, opportunities shareholders. better I make of all ways, and as how we options review constantly the is the

certain there's of come timely accordingly. opportunity we shareholders will communicate will when and we I with plan, and out appears, the think the

Our of next question comes from the Salgaonkar BofA. Sachin line with

Congrats of good set on numbers. a

going here. achieving Brazil. margin an and it Should the First about the hover to Or question EBITDA levels congrats here? here? is ahead? margin going make margins out for out continue breakeven looking to think an should should these improvement on out given we in Clearly, How we investments around see you're

credit the ahead? at look you going do how in is course, Brazil of business evolving is, question Related

amount question think incremental where it else? DFS second EBITDA being Is now is maximum breakeven, investment it or logistics? more about made? And you anything your all of that investments, towards you Is see do more are towards businesses when

very Brazil still our If achieved a market, breakeven in very you market, been in it's at the market. happy and this dynamic we've the quarter. we that EBITDA market newest look It's

the fluctuation we as will look generally, But we although time there for that But further grow can from manner, we to think use are market hoping thinking. might be a profitable to a generally, time. base with some I in

I in quarters at Shopee through in a our ago, If look penetration and in very shared businesses you we questions, see started we as Brazil, SPayLater. the few earlier the good credit

loan our good product with launched we that rate in Brazil cash take also very observed. a We

our fine-tuned further modeling stage have we a importantly, comfortable lot more a More risk grow we in to to the Brazil are market. in with that

in our So we the are finance optimistic quite by the service generally, quarters. of in digital potentials business coming Brazil

the for And if various we prudent businesses, take you look a investment. at the to approach investment very

XX optimizing if at It typically any you to between through range. have investments those months months quite logistics, quickly period, can let's in contribute a our our the by structure. investment look X cost payback For to we example, EBITDA typically to say,

platform. in DFS each as the year. to are bring is the make sure user can DFS attracting generally profitability the bring see look profitable the the make look right that we we is DFS the for to way from in The we businesses, profit in we you quite it at the side, measure we user investment user on each has core a coming has meaningful been for the If numbers. you side The sure acquisition to at probably user

investment, as we new e-commerce in invest users of type on side, acquiring the other example, for do well. The

life In user's we unit also the measuring general, we cost acquiring those cycle markets. the users. time will life most approach breakeven in for economics compare you on For acquire customer for to the terms a each cases, users customer against cost take the year's of with that, value cycle if value in prudent in of spent quite most the the

of line comes with Barclays. Our final Jiong question from the Shao

the Congrats on very results. DFS My strong question the on first business. is

the Any about the growth of key progress couple accelerated last tremendous quarters, this and bit Is was in business? the you unpack expansion, I next accelerated if what for that for, quite wondering talk this can book. regional quarter, expansion? years out the and your both should a main that, the business? growth product grow sort a look made have few loan for things drivers You for for this for business continued are of this we to just over revenue

could reach for profit just leverage Or being the scale is once And times? at in you is improvement sort for Again, will e-commerce business, the meaningful this in improvement play question of Shopee profitable model. And certain leverage in second on business the in a be itself and your congrats again. out profitability? that gradual

our users That's more service that over the of we've you absolutely growth platform. I digital that users service if We the our attract think our time users forward, to right terms it's of and growth. user would in business essentially #X. finance And terms non-e-commerce our you're look to a digital come finance e-commerce digital will user happy the #X, So finance of like growth. service our from, the in with business, as well in very been become to

Number different more existing of products have across risk the both to also products, to financial different optimize user more users address their X get expanding segment course, essentially to from our our profiles use of needs to the is, users our assortment life product to with and might offerings cycles. that the

going I to approach. be think it's both

user plus mix think country -- The additions I of The the plus assortment DFS, start our we optimization, Indonesia. for for with users. in product product the growth terms the

newer benefit products As a growth I also the we over efficiently continue shared and that more the a the to more we experience attract user the earlier, in from fashion. learned see trend are from I other the And very so earlier good to we would that countries in countries will expect targeted some quarters. roll countries going able out

to profitability, it's in On serve our likely see our the any gradual our both, natural downstreams. And we a cost the on will environment to we operating own ecosystem we think more whether our in big also improvement upstream, that e-commerce it's is optimize on jump potentially without stable expenses or and you customers reduce external able to the I probably a In are the a gradual customers. profitability. improvement grow shocks, profitability environment a a as as serve

a the managed last of you platform to but we same few have at quarters, perspective. have service those if or we serve have, customer growing amount it our been amount example, people of in from look people For the that the customers even lot with orders quite small we

all relatively in possibility profitability the those as in future. becomes jump that But we there market that contribute see a in gradual will to is the So more over years, a stable improvement profitability. sizable is

the graduation the that we're both case possibilities, on profitabilities I gradually is the think, yes, to right we're to next able working your few improve question base quarters. now over but is that

our now call session. for Mr. I will turn question-and-answer back remarks. over concludes M.C. Koh This the to closing

all for quarter. joining speaking you today's again look call. you all Thank to of to next We forward

concluded. The presentation. today's Thank attending conference now has you for

disconnect. c now may You