Southeast Asia internet services giant Sea Limited (SE) on Tuesday missed expectations for the first quarter as its video game unit underperformed. SE stock tumbled in early trading.
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The Singapore-based company earned 15 cents a share on sales of $3.04 billion in the March quarter. However, analysts polled by FactSet had expected Sea earnings of 68 cents a share on sales of $3.06 billion. In the year-earlier period, Sea lost 80 cents a share on sales of $2.9 billion.
Sea operates three businesses across digital entertainment, e-commerce and financial services, known as Garena, Shopee and SeaMoney, respectively.
Garena is a global online games developer and publisher. Shopee is the largest pan-regional e-commerce platform in Southeast Asia and Taiwan. SeaMoney is a leading digital payments and financial services provider in Southeast Asia.
Sea Stock Dives After Earnings Report
In the first quarter, Sea’s digital entertainment revenue plummeted 52.5% to $540 million. Meanwhile, the company’s e-commerce and other services saw sales jump 50.7% to $2.26 billion. Sales of goods dipped 8.7% to $242 million.
In premarket trading on the stock market today, SE stock fell 6.7% to 82.13.
Sea stock had been climbing ahead of the first-quarter report. The company reported the first quarterly profit in its 14-year history in March with its fourth-quarter results.
SE stock has formed a cup base with a buy point of 88.94, according to weekly IBD MarketSmith charts.
SE Stock Ranks Fourth In Group
“Across our business, we have been focused on maximizing operational efficiency and improving user experiences,” Chief Executive Forrest Li said in a news release.
He added, “As we continue to fine-tune our operations and navigate near-term macro uncertainties, we remain highly confident in the long-term opportunities in our markets and our ability to capture those profitably.”
SE stock ranks fourth out of 59 stocks in IBD’s Retail-Internet industry group, according to IBD Stock Checkup. It has an IBD Composite Rating of 88 out of 99.
Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
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