Maybank Investment Bank said Wednesday that Singaporean technology firm Sea Limited’s results and its management positive expectations have reinforcing its view that Shopee margins have bottomed and are entering a more sustained expansion phase.
The research house said in a note that Sea delivered another strong quarter, with Shopee gross merchandise value (GMV), Monee’s loan book, and Garena bookings growing 28 percent, 62 percent, and 15 percent year on year, respectively.
Revenue rose 48 percent year on year and came in about 10 percent ahead of street expectations, while adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $917 million was about 2 percent ahead of consensus, driven by stronger-than-expected Shopee margins and resilient Garena.
More importantly, it noted Shopee remains well on track to exceed its FY26 GMV growth target of about 25 percent, while management now expects e-commerce adjusted EBITDA to surpass $1 billion this year.
According to Maybank, Shopee’s competition remains rational in its core markets, while rising commissions and advertising penetration (ad take rates up more than 90 basis points year on year) continue to expand monetization opportunities.
Meanwhile, investments in Shopee VIP, fulfilment, content commerce, and logistics are translating into better user engagement and operating leverage.
It is also noted that VIP members now contribute 24 percent of Asia gross merchandise value (GMV), while fulfilment order volumes grew more than 20 percent quarter on quarter, and livestreaming and short-video orders rose more than 50 percent year on year.
“These initiatives are driving stronger buyer acquisition, retention, and conversion, with Sea highlighting improving unit economics across newer growth investments. We believe several of these investments are approaching maturity,” said Maybank.
As for Monee, the research house highlighted its loans outstanding grew 63 percent year on year to $11.1 billion, while NPL90 improved to 1 percent, underscoring the resilience of its underwriting model.
It is noted that the management pushed back against concerns around higher provisions, elevated sales and marketing (S&M) spending, and slower margin expansion, arguing that these are largely due to mix shifts towards newer, lower-yielding markets, off-Shopee lending, and larger loans to prime customers, rather than deteriorating fundamentals.
Importantly, management continues to prioritize absolute EBITDA growth over near-term margin optimization, reflecting the sizeable runway in underpenetrated markets and off-platform financial services opportunities.
Maybank also noted that Garena delivered 15 percent year on year bookings growth with stable margins, while the quarter on quarter moderation reflected seasonality.
Free Fire continues to show remarkable longevity, sustaining over 100m DAU while maintaining healthy monetization trends, it said.
Management also announced two new titles, Palworld Online and Monster Hunter Outlanders, which should support portfolio diversification over time.
“In the near term, a stronger content pipeline, upcoming collaborations, and seasonal events in third quarter should help sustain engagement and bookings momentum,” said the research house.
Singapore’s Sea Limited posts $7.8B Q2/2026 revenue, e-commerce Shopee account for 72%