Monday, 4 Mar 2024

Sea Reports $281M Net Loss, 73% Increase in Paying Garena Users

Today, Garena’s parent company Sea reported its financial earnings for the first quarter of 2020. Garena, which was founded in Singapore in 2009 by its current Chairman and CEO Forrest Li, is Sea’s digital entertainment segment focusing on the greater Southeast Asian gaming and esports market. The company generated net revenues of $714.9M USD for the period ended on March 31, which represents a roughly 103% increase from $351.9M in Q1 2019.

Garena contributed $369.7M or 51.7% of the group’s net revenues in Q1, an increase of 113% from $173.4M in the first quarter of 2019, while the remaining revenues came from Sea’s e-commerce segment Shopee, digital financial services segment SeaMoney, and other services. In total, the company ended the quarter with a net loss of $280.8M, compared to a net loss of $689.6M in the same period of 2019.

Sea’s Chairman and CEO commented on the current economic situation, stating that “The coronavirus crisis is driving a step change in the growth of the digital economy globally, materially accelerating a shift to online lifestyles that is broad, deep, and, in our view, irreversible. We believe that Sea, as a market leader in some of the key sectors of the digital economy, is gaining and will continue to gain a disproportionate share of the resulting growth in our markets.”

The company reported 402.1M quarterly active users in Q1 on its digital distribution platform, Garena, which marks a 48% increase year-over-year from 271.6M in the same period of 2019. Simultaneously, Garena’s quarterly paying users grew by 72.5% year-over-year to 8.9% of total quarterly active users or 35.7M. While the total number of users grew, the average revenue per user slightly decreased from $1.40 in Q1 2019 to $1.30 in the first quarter of 2020.

Sea revealed that its self-developed battle royale game, Garena Free Fire, recently hit a new record high of over 80M peak daily active users. Additionally, the company organized more than double the number of esports tournaments online for Free Fire in Q1 2020 compared to the first quarter of 2019, with these tournaments accumulating over 90M views.

Furthermore, the company partnered with several celebrities to promote Free Fire. In partnership with Indonesian actor Jow Taslim, Garena introduced the in-game character Jota modeled after the actor. In Brazil, Garena’s long-term partner musician Alok Achkar Peres Petrillo (known as DJ Alok) took part in an online competition against Free Fire influencers as a warm-up for a live set he performed across local social media channels. In Colombia, soccer players James Rodriguez and David Ospina captained teams of Free Fire influencers in an online charity tournament.

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