Sea Ltd (NYSE:SE) stock fell 5.64% (As on May 18, 11:35:09 AM UTC-4, Source: Google Finance) after the company posted better than expected results for the first quarter of FY 22, driven by improvements in its core e-commerce business in Southeast Asia and Latin America. Sea pushed the peddle on international expansion moving into newer markets including Chile, Colombia, and Mexico over the last two years amid a pandemic-driven boom in e-commerce and digital entertainment. The company, however, struggled to keep up with its rapid expansion and had to exit some of its newer markets such as India and France to subsequently focus on South East Asia, its home turf. SE rose more than 14% after reporting core gaming revenue grew faster than expected, offsetting a slowdown across the rest of the Southeast Asian internet giant’s business as online activity retreats from pandemic-era heights.

SE in the first quarter of FY 22 has reported the adjusted loss per share of 80 cents, beating the analysts’ estimates for the adjusted loss per share of $1.26. The company had reported the adjusted revenue of $2.9 billion in the first quarter of FY 22, beating the analysts’ estimates for revenue of $2.86 billion. Sea generated $1.5 billion in revenue from e-commerce operations, while analysts were projecting $1.7 billion in e-commerce revenue. Digital entertainment revenue stood at $1.14 billion, topping the consensus estimates of $927.3 million. The company reported an adjusted EBITDA loss of $509.9 million, compared to an $88.1 million profit in the same period last year, while analysts were expecting a loss of $506.2 million. First-quarter revenue from Shopee, Sea’s e-commerce unit, rose 64% to $1.5 billion, versus estimates of $1.7 billion. Revenue from gaming arm Garena gained 45%. The company said in March it expects Garena to post $2.9 billion to $3.1 billion in bookings in 2022, set to be its first decline ever.

Sea said that due to elevated macro uncertainties, it now sees a wider dispersion of potential scenarios for Shopee for 2022 and has lowered its e-commerce guidance to between $8.5 billion and $9.1 billion, representing 71.8% growth from 2021 compared to the previous guidance of between $8.9 billion and $9.1 billion. This is compared to the analyst expectations of $8.95 billion. The company is also exploring publishing partnerships and making early investments in game studios.