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Call sheet · Q3'25

Sea (SE)

Q3'25 earnings call · held 2025-11-11 · compared with the Q2'25 call · management-credibility review
9/12
Disclosure score
4 medium, 3 low flags
Financial quality
Bottom line
The sleeper story is fulfillment - SE is quietly building Amazon FBA for Southeast Asia, pre-shipping inventory to remote islands and offering warehouse services. This isn't just logistics anymore, it's supply chain control. The headline 58% EBITDA growth masks concerning margin compression in ecommerce (down 240bps QoQ) despite higher take rates, signaling front-loaded investment costs for VIP and fulfillment. The binding constraint is working capital - rapid loan book growth ($1B added in quarter) and fulfillment inventory requirements will pressure cash generation. Forrest's killer quote: 'After seven years of experience with XPS Express, we have both' the understanding and network to build fulfillment - they're leveraging existing moats. My view changes if Q4 ecommerce margins don't stabilize or if they start disclosing negative free cash flow.

The 30-second version

  • Fulfillment is the new logistics play - SE is quietly building warehouse infrastructure
  • 58% EBITDA growth masks an ecommerce margin compression to 4.3%
  • Brazil's loan book more than tripled YoY but they stopped disclosing key credit metrics

What changed this quarter

MetricQ2'25Q3'25Change
Total Revenue$5.3B (+38% YoY)$6.0B (+38% YoY)Flat growth rate, up $700M absolute
Adjusted EBITDA$829M (+85% YoY)$874M (+58% YoY)Deceleration of 27 points in growth rate
Ecommerce EBITDA Margin6.0%4.3%Down 170bps QoQ, concerning trend
Shopee GMV Growth25% YoY (H1)28% YoYAcceleration, raised FY guidance to 25%+
Money Revenue$883M (+70% YoY)$990M (+61% YoY)Deceleration but strong absolute growth
Money Loan Book$6.9B (+90% YoY)$7.9B (+70% YoY)Added $1B in quarter, growth moderating
Money NPL Ratio1.0%1.1%Uptick of 10bps, still healthy
Garena Bookings$661M (+23% YoY)$841M (+51% YoY)Massive acceleration, best quarter since 2021
Garena EBITDA Margin65.8%55.4%Down 1040bps QoQ despite revenue surge
Free Cash FlowNot disclosedNot disclosedStill no FCF disclosure

Accountability tracked

8 new promises made5 narrative shifts flagged6 prior promises scored
Inside the full report
The complete write-up covers the full promise ledger with kept/missed calls, disclosure-quality scoring, the metrics-vanished check, verification items, and the questions to ask next quarter.
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Scores, kept-promise rates, and flags on this site reflect the author's opinion, applying a stated methodology to statements management made on public earnings calls. Informational and educational purposes only - not investment advice, a recommendation, or an offer to buy or sell any security. Sources believed reliable but not guaranteed; the author may hold positions in the securities discussed.

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