Sea Ltd (NYSE:SE) stock fell 0.37% (As on August 16, 11:33:05 AM UTC-4, Source: Google Finance) after the company posted mixed results in the three months ended June 30, as tepid consumer spending amid a challenging macroeconomic outlook pressured its e-commerce business and caused a steep decline in its mobile gaming unit. Sea’s e-commerce business Shopee, which contributes about two-thirds to the group’s top-line, grew about nearly 21% to $2.1 billion. It was below consensus estimate of $2.25 billion, despite Sea posting 10% sequential growth in active buyers in the second quarter and raising platform commissions earlier this year. Sales from the digital entertainment segment, which includes gaming platform Garena, fell over 41%, declining for the fifth quarter in a row. Sales from the financial services business were up over 53%. The company has signaled that it will boost investments in its core e-commerce business which may lead to losses in some quarters, pivoting its strategy after months of cost cuts and weak performance in the second quarter.

Moreover, as per Garena segment, during the second quarter, both quarterly active users and quarterly paying users grew quarter-on-quarter as Free Fire showed sustained signs of improvement in user retention and engagement. Bookings for the game also grew quarter-on-quarter for the first time in the past seven quarters. These recent trends are encouraging signs of Free Fire stabilizing while remaining one of the largest mobile games worldwide and the company will continue to closely monitor if this is the beginning of a longerterm stabilization of the game. SeaMoney’s second quarter performance was strong as SE continued to expand the features and product offerings across the business.

SE in the second quarter of FY 23 has reported the adjusted earnings per share of 66 cents, beating the analysts’ estimates for the adjusted earnings per share of 54 cents. The company had reported the adjusted revenue growth of 5.2 percent to $3.10 billion in the second quarter of FY 23, missing the analysts’ estimates for revenue of $3.20 billion, as per Refinitiv estimates. Profitability in terms of adjusted EBITDA also continued to improve meaningfully on both a year-on-year and quarter-on-quarter basis to reach 137 million dollars. On credit, as of the end of the second quarter of 2023, the total loans receivable on the balance sheet was 2 billion dollars, net of allowance for credit loss of 279 million dollars. Non-performing loans past due by more than 90 days as a percentage of the total gross loans receivable remained stable at around 2%.