Factoring in Sea Limited‘s third quarter results, Maybank Investment Bank has raised the Singapore tech giant’s adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) estimates by 2 percent to 3 percent for FY25 to FY27.
The research house said in a note on last Wednesday that Sea’s third quarter adjusted EBITDA grew 68 percent year on year/5 percent quarter on quarter, beating its and street
expectations by 4 percent to 5 percent.
“The beat was mainly driven by the gaming business, where adjusted EBITDA rose 48 percent year on year/27 percent quarter on quarter – 15 to 22 percent ahead of estimates – supported by highly impactful IP collaborations,” said Mayba.
However, it noted Shopee’s adjusted EBITDA of $186 million marked a second straight quarterly decline and missed its and street expectations by 15 percent to 16 percent, despite solid gross merchandise value (GMV) growth of 28 percent year on year/8 percent quarter on quarter.
According to the research house, Sea’s management reiterated that margins will rise in FY26 though not linearly, as resources are reinvested to prioritize ecosystem depth and scale to sustain GMV growth. Areas of investments include fulfilment infrastructure (to deepen its logistics edge by expanding from delivery leadership to fulfillment excellence), pre-shipping orders in its warehouses, expansion in rural areas and expansion of VIP program, although in an asset-light model.
Management also noted Shopee’s first quarter adjusted EBITDA to GMV margin of 0.9 percent was helped by lower spending from its competitor and as such shouldn’t be the benchmark for year on year comparison in the first quarter of 2026.
Management noted that despite MELI’s subsidies in Brazil, their approach remains rational and sustainable, while in Taiwan, Coupang’s 1P model contrasts with Shopee’s 3P marketplace.
Leveraging its cost-efficient logistics and differentiated platform, Shopee continues to gain market share and grow GMV in both markets despite intensified competition.
Meanwhile, Monee business is growing rapidly, adding $1 billion to loan books each quarter.
However, near-term margin pressure may persist due to ongoing user and merchant onboarding, product diversification, and marketing investments, said Maybank.
“Management expects Monee absolute EBITDA to grow in FY26; however, we see potential margin compression from higher sales and marketing (S&M) spending and aggressive expansion into markets with lower interest rates and higher upfront provisioning,” it added.