Sea Limited (SE) to Report Q1 Earnings: What's in Store?

Zacks Equity Research

10 May 2024 at 10:45 am·3-min read

Sea Limited SE is set to release its first-quarter 2024 results on May 14.

The Zacks Consensus Estimate for earnings has been unchanged at 36 cents in the past 30 days. The figure declined 40.98% year over year.

The consensus mark for revenues is currently pegged at $3.62 billion, indicating 22.02% growth from the year-ago quarter’s reported figure.

SE’s earnings beat the Zacks Consensus Estimate in one of the trailing four quarters while missing the same in the remaining three, the negative earnings surprise being 55.87%, on average.

Sea Limited Sponsored ADR Price and EPS Surprise

Sea Limited Sponsored ADR price-eps-surprise | Sea Limited Sponsored ADR Quote

Let’s see how things have shaped up before this announcement.

Factors at Play for Q1 Results

Sea Limited's digital financial services segment is likely to have experienced growth due to the diversification of its overall service offerings, reaching a wider user base. The Zacks Consensus Estimate for first-quarter 2024 digital financial services revenues is pegged at $487 million indicating 17.91% year-over-year growth.

Sea Limited's key digital financial services offering, SeaMoney, is anticipated to have been the main growth driver for the segment’s performance in the to-be-reported quarter. Continued investments in user acquisition for the credit business, along with expansion into digital banking and insurance services, are anticipated to have driven SeaMoney's profitability in the first quarter.

The digital entertainment business of Sea Limited is expected to have benefited from strengthening user engagement and improved gameplay in the to-be-reported quarter.

The launch of significant games, such as Garena’s flagship game, Free Fire, in its pipeline, and advancements in AI are anticipated to have enhanced its operational capabilities on the Garena platform.

Free Fire achieved more than 100 million peak daily active users in the fourth quarter of 2023 and is expected to continue growing in terms of user base and bookings in the to-be-reported quarter.

Growing momentum across its e-commerce business, owing to its synergies with Shopee to improve service quality for buyers, enhance price competitiveness and strengthen the content ecosystem, is expected to have contributed to its growth in Gross Merchandise Volume (GMV). This, in turn, is likely to have aided the company’s top-line growth during the quarter under review.

However, the difficult macroeconomic environment, inflation and rising interest rates are expected to hurt SE’s topline in the to-be-reported quarter.

What Our Model Indicates

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Sea Limited has an Earnings ESP of 0.00% and a Zacks Rank #2. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are some companies worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:

NVIDIA NVDA has an Earnings ESP of +2.50% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

NVIDIA’s shares have surged 79.2% year to date. NVDA is scheduled to release first-quarter fiscal 2025 results on May 22.

Agilent Technologies A has an Earnings ESP of +0.72% and a Zacks Rank #3.

Agilent Technologies’ shares have inched up 4.4% year to date. A is set to report its second-quarter fiscal 2024 results on May 29.

Applied Materials AMAT has an Earnings ESP of +0.31% and a Zacks Rank #3 at present.

Applied Materials’ shares have gained 27.3% year to date. AMAT is set to report second-quarter fiscal 2024 results on May 16.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

NVIDIA Corporation (NVDA) : Free Stock Analysis Report

Agilent Technologies, Inc. (A) : Free Stock Analysis Report

Sea Limited Sponsored ADR (SE) : Free Stock Analysis Report

Applied Materials, Inc. (AMAT) : Free Stock Analysis Report

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Sea Limited Sponsored ADR Price and EPS Surprise

Factors at Play for Q1 Results

What Our Model Indicates

Stocks to Consider

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