Shares of Sea Limited (NYSE:SE) jumped 8.7% on Tuesday, following the release of the Singapore-based tech company's second-quarter results.
Sea's revenue soared 102% year over year to $882 million, fueled by broad-based growth across its online gaming, e-commerce, and digital payments businesses.
Notably, Sea's quarterly active users in its digital entertainment segment climbed 61% to 500 million, while its paying users surged 91% to 50 million. The gains were driven in part by the strong performance of Sea's self-developed megahit game, Free Fire, which hit a peak of over 100 million daily users and was the highest-grossing mobile game in Southeast Asia in the second quarter.
Still, Sea remains unprofitable; it generated an operating loss of $373 million, compared to $235 million in the year-ago quarter. The company did, however, produce adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $7.7 million, compared to an $11 million loss in the prior-year period.
With leading positions in digital entertainment and e-commerce in the fast-growing Southeast Asia region, Sea Limited is well-positioned to benefit from the rapid expansion of these markets in the coming decade. Moreover, with Chinese tech titan Tencent Holdings a major shareholder, Sea Limited has the backing of a powerful force in the global gaming and payments industries. That should only help to boost its odds of success.