Sea, which integrates games, e-commerce and mobile payments, has quietly become the best-performing large-cap stock in the world.

Sea lost $281 million in the first quarter, but its share price soared, rising more than 200% this year.

Can it become the next Internet giant with Tencent and BABA in the future? Sea will release its second-quarter results before August 18, so let's wait and see.

-Editor's Note

In terms of performance over the past 18 months, no US technology company can match Sea, a Singaporean gaming, e-commerce and payments company. According to Bloomberg$Sea Limited (SE.US) $The share price has risen more than 880% since it was listed on the New York Stock Exchange in 2017.$Apple Inc (AAPL.US) $、$Tesla, Inc. (TSLA.US) $和$S & P 500 (.SPX.US) $Far behind.

Sea shares hit an all-time high near the $147 mark on Aug. 5.

Leading the Southeast Asian market, Tencent is the largest shareholder

Founded in May 2009 and headquartered in Galaxis, Singapore, Sea has developed into an integrated platform of digital entertainment, e-commerce and digital financial services, with the responsibility of improving the ecology of consumers and small and micro businesses in Southeast Asia through technology. Sea is a member of Tencent, and Tencent is its largest shareholder, with a stake of about 20 per cent.

The business layout of Sea is mainly divided into three parts: Garena, Shopee and AirPay.

• GarenaOnline game platformGarena is the most popular online game instant communication and social platform in Southeast Asia, Hong Kong, Macao and Taiwan. As of the first quarter of 2020, the number of active users exceeded 400 million, an increase of 48% over the same period last year. Garena not only has the exclusive agency for popular games such as "League of Legends" and "FIFA Online 3", but its self-developed game "Free Fire" also has a strong performance, ranking first on the best-selling list of games in Southeast Asia. In January, Sea acquired Pheonix Labs, a Vancouver game developer, to expand its ability to serve more international markets.

• ShopeeE-commerce platformBy integrating logistics and payment support, Shopee aims to make online shopping easy and secure, making it an one-stop platform for social e-commerce in Asia. Its Shopee platform overtook BABA's Lazada in 2019 to become the largest ecommerce provider in Southeast Asia, accounting for more than 40 per cent of Sea's total revenue, up from 2.3 per cent in 2017, according to iPrice, a research firm.

• SeaMoney payment platformIs one of the fastest growing digital financial services (DFS) networks in Southeast Asia, and its products include electronic wallets, payment processing, micro-loans and related digital financial services. Sea aims to achieve a dynamic balance between games and e-commerce by deeply binding them with payment.

Digital entertainment and e-commerce business grew by more than 100% year-on-year, and e-commerce is still the core driver.

Sea, which has a market capitalization of more than $60 billion, overtook DBS to become the largest company in Southeast Asia for the first time this year.The first quarter reported revenue of $715 million (yoy+103%) and a net loss of $281 million. The loss still can not stop the soaring share price, the company said that all operations are under control.

Steady development of game business

2020Q1 adjusted digital entertainment revenue of $512.4 million (YoY+30.3%), accounting for 55% of total revenue.Revenue growth is mainly driven by the expansion of the head game user base and the further increase in payment rates. from a product point of view, revenue is still driven by the self-developed game "Free Fire".With the deepening of global development, Latin America and other frontier markets such as India, Russia and the Middle East have contributed half of 2020Q1's adjusted digital entertainment business revenue.

Rapid growth of e-commerce business

The company's e-commerce revenue includes revenue from three-party businesses such as C2C/B2B2C and merchandise sales from B2C business.

2020Q1 adjusted ecommerce revenue of $314m (YoY+134.6%), accounting for 33 per cent of total revenue.The increase in e-commerce revenue is mainly driven by the expansion of the GMV scale of the three-party business, including commission income, value-added service revenue and advertising revenue.In this quarter, the company's e-commerce business realized a total of US $6200 million (YoY+74.3%) in GMV and 429.8 million orders (YoY+111.2%). The overall realization rate of e-commerce tripartite business was 5.1%.

In Southeast Asia and Taiwan, Shopee ranks first in the number of Android monthly active users and the total length of time used by Android users 2020Q1 and 2019.

Brand integration, power finance

2020Q1 adjusted digital finance business realized operating income of 10.7 million US dollars (YoY+277.5%).

2019年，Sea uses the SeaMoney brand to integrate the brands and businesses of digital finance.Further integration of Shopee platforms and payment services in various markets to enhance the organic growth of SeaMoney and help e-commerce users reduce transaction friction. 2020Q1, Shopee30% Indonesia's order is paid through SeaMoney's e-wallet.

As the necessary infrastructure of the group, digital finance will continue to deepen and promote the intra-group synergy with digital entertainment and e-commerce business, and as the fastest-growing opportunity area in the company's operating area, financial business will also go hand in hand with gaming and e-commerce business.

Analysts value Sea's shares in the range of $119 to $150, according to Bloomberg data.

Sea will release its 2020 Q2 results before Tuesday, Aug. 18. The share price has moved first today, up more than 3% as of press time.

• USSESea LimitedIn transaction08lap 17 11:15 American time131.110+3.64%

But it's worth mentioning thatHillhouse's latest Q2 US stock position report 13F shows that it significantly reduced its holdings of Sea in the second quarter, reducing its holdings of 650000 shares by 52 per cent.Hillhouse began to build its Sea in Q1 in 2019, and the average cost is estimated to be$23.52It seems that Hillhouse has made a lot of money.