Sea doubles annual earnings, yet profitability worries drag shares down in worst drop in 2 years

Sea more than doubled its annual profits in 2025, as the Southeast Asian tech giant reported strong performance in its fintech division and expansion in new markets like Brazil. Yet concerns about profitability sent the company’s shares into their worst drop in two years.

The Singapore company posted full-year revenue of $22.9 billion, a 36.4% increase from the previous year. Net profits also rose by almost 260%, from $447.8 million to $1.6 billion. Fintech division Monee was the company’s fastest-growing division, posting 60% growth over 2025. (During the earnings call, Li added that Sea wants to continue expanding the division’s suite of products, foraying into areas like digital banking and insurance).

“We see much headroom to strengthen our market leadership and improve e-commerce penetration in Taiwan,” said Forrest Li, Sea’s CEO, during the company’s earnings call. He added that Sea is also looking to strengthen its fulfillment capabilities in Brazil—its fastest-growing market in 2025.

Sea is also trying to grow its AI use. Last month, the firm signed a partnership with Google to develop AI tools to its three business segments, specifically agentic AI shopping agents for e-commerce platform Shopee, AI-powered payments for its fintech division Monee, and AI-enhanced game development for its gaming wing Garena. 

Sea is also looking to deepen its presence in existing markets, like Brazil. Sea onboarded 300 local Brazilian brands onto Shopee Mall in Q4. Buyer waiting time was also cut by 1.5 days. 

‘Short-term pain’

Despite Sea’s surge in revenue, disappointing quarterly profits at $410.9 million drove the company’s shares down by 16.5%; it’s the largest drop in the tech giant’s stock in two years. 

Revenue at Shopee, Sea’s e-commerce division, grew by 35.8% last quarter, yet the division’s cost of revenue rose by 43.2% over the same period; Sea blamed “an increase in logistics costs as orders volume grew.”

Sea is battling increased e-commerce competition in some of its markets, like Vietnam and Brazil, particularly from Chinese platforms like TikTok Shop and Temu. 

Analysts argued that Sea’s share plunge was an overreaction. Hussaini Saifee, an equity research analyst at Maybank Securities, said investors would suffer “short-term pain for long-term gains”.

“We see this [Sea’s strategic moves] as calibrated moat-building—logistics scale, AI-driven underwriting and ecosystem depth strengthening long-term earnings power,” he said.

This story was originally featured on Fortune.com