Sea Q4 FY25 earnings call SE

Shopee is focusing on enhancing user experience through logistics improvements like instant and same-day delivery, which now account for a double-digit share of order volume in major metropolitan areas and drive 15% higher average spend. The company is also expanding its fulfillment network, aiming to double order penetration by year-end 2026, and growing its content ecosystem through partnerships with YouTube and Meta. These efforts are designed to serve more users and engage them better, building structural moats.

The Shopee VIP membership program, rolled out across Asian markets, has surpassed 7 million subscribers by the end of 2025, more than doubling from the previous quarter. Members show a double-digit spending uplift, with Indonesian VIP members spending 30% to 40% more than before joining. The program already contributed over 15% of total GMV in some markets in Q4. Leveraging improved payment retention rates (40% to 70% in Indonesia) through collaboration with Monee, the program is slated for launch in Brazil in the coming months^⏳.

Shopee delivered robust GMV growth and market share gains in Brazil, improving buyer waiting time by 1.5 days year-on-year in Q4. Over 300 new brands were onboarded to Shopping Mall in Brazil, doubling its GMV year-on-year in Q4. In Taiwan, GMV growth accelerated to double digits in 2025, supported by a large-scale network of over 2,800 collection points. Both markets are targeted for accelerated fulfillment capability rollout and brand onboarding to attract higher-value categories and improve average basket size.

Monee expanded its credit business by acquiring new users through an 'all-can-apply' approach, adding 5.8 million unique first-time borrowers in Q4, and growing active credit users to over 37 million (up over 40% YoY). Average loan outstanding per user increased 27% YoY to $240. Off-Shopee SPayLater loans grew over 300% YoY, accounting for over 15% of the total SPayLater portfolio, with 30% usage off-Shopee in Malaysia. Monee is also progressing with products beyond credit, including digital banking and insurance.

Monee maintained a stable 90-day NPL ratio of 1.1% as of the end of Q4 by enhancing risk underwriting capabilities using rich ecosystem data and advancements in AI. The company is experimenting with new AI models, including transformer structures, to better understand user behavior, assess individual repayment capacity, and dynamically adjust credit limits. These improvements enable rapid, prudent scaling of the loan book while maintaining a stable risk profile.

Free Fire achieved two consecutive years of bookings growth exceeding 30%, with 2025 bookings nearly double 2023 levels, and average daily active users continuing to grow year-on-year. Key content collaborations like NARUTO SHIPPUDEN (Chapter 1 in Q1, Chapter 2 in Q3) and Squid Game (Q3), along with the Guinness World Records-setting Free Fire World Series Global Finals, underscore its status as a global franchise spanning gameplay, social engagement, and real-world experiences.

Beyond Free Fire, Garena saw strong early performance from EA Sports FC Mobile, which became the most downloaded mobile game in Vietnam after its October launch. The FC Pro Festival 2025 in Ho Chi Minh City reached 18 million online viewers, featuring global football icons. This demonstrates Garena's ability to localize global franchises and deeply engage fan communities, strengthening its long-standing partnership with EA.

Sea Limited is investing in AI across its businesses. In Shopee, AI enhances search, recommendation, and ad systems, contributing to an uplift in ad take rate, and provides tools for sellers like chatbots and content creation. In Monee, AI is crucial for risk management, leveraging e-commerce data for precise credit assessments. Synergies include Monee using Shopee data for risk assessment, Monee supporting game payments, and Shopee/Gaming collaborating on merchandising and user acquisition.