Singapore's Sea Reports Mounting Losses, President to Depart

(Bloomberg) -- Sea Ltd., operator of Southeast Asia's biggest gaming platform, reported mounting losses amid investments for growth and said Group President Nick Nash will leave his position at the end of the year.

The Singapore-based company reported its net loss for the quarter ended in December more than tripled to $263.1 million, compared with analyst estimates that it would lose $201 million, while total revenue climbed 41 percent to $124.6 million, according to generally accepted accounting principles.

Nash, who helped lead Sea's initial public offering last year, said he plans to start a new private-equity fund. He joined the company in 2014 from General Atlantic LLC.

“I want to share the unique experiences I've had to help a new generation of companies here in Asia,” Nash, 39, said on a conference call. “That sharing of learnings from one generation of companies to the next has been a hallmark of what made Silicon Valley so successful. And I look forward to continuing that tradition here in Asia.”

Sea has struggled to gain steady footing since it raised about $1 billion in the October IPO. Its shares have tumbled while short sellers are betting on further declines. Analysts have remained bullish. Every one of the seven who cover the company recommend buying its shares, according to Bloomberg's data, with an average target price almost 50 percent higher than Tuesday's close of $12.26.

The Tencent of Southeast Asia Isn't Really Like Tencent at All

Analysts consider Sea to be Southeast Asia's leading growth company, with backing from Chinese colossus Tencent Holdings Ltd. that should help it capitalize on the region's adoption of games, e-commerce and digital payments. Skeptics see little evidence that Sea is developing anything resembling a business model with its mounting losses.

The company is investing in e-commerce and digital payments to bolster its games business. Its operating loss increased in the fourth quarter to $191.1 million, compared with $83.2 million a year earlier.

In 2018, Sea is forecasting total adjusted revenue of $730 million to $770 million, up from $553.6 million in 2017.

To contact the reporter on this story: Yoolim Lee in Singapore at yoolim@bloomberg.net.

To contact the editors responsible for this story: Robert Fenner at rfenner@bloomberg.net, Peter Elstrom, Reed Stevenson

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