Sea Limited, one of the largest tech players in Southeast Asia, achieved a key milestone in 2025. Not only did it turn a net profit for the second year in a row, but it did so across all three of its main business segments (e-commerce, finance, and gaming). Perhaps most importantly, 2025 was the year Sea’s marquee e-commerce platform Shopee finally made more money than it lost.
Why is this a big deal? E-commerce in Southeast Asia has long been identified as a massive market, and about ten years ago we saw the launch of major online marketplaces that were expected to dominate the sector, driving tens or hundreds of billions of dollars in transactions. In Indonesia, this led to the birth of tech unicorns like Tokopedia and Bukalapak. In Singapore, Shopee has been the dominant player.
For reasons we won’t go into here, Indonesia’s e-commerce platforms haven’t really lived up to expectations. But Shopee has slowly been moving toward profitability. Shopee’s parent company, Sea, was the first really big tech start-up from Southeast Asia to go public, listing on the Nasdaq in a blockbuster 2017 IPO. Since then, the company and the stock have been on a wild ride, reaching eye-watering heights during the pandemic before crashing back down to Earth.
After the share price collapsed in 2021, Sea got serious about cutting spending and becoming more efficient. In 2023, the company posted its first year of net profits after years of large losses, a run which it has extended into 2025. According to unaudited 2025 financial results, net income for the year was $1.6 billion. Total revenue was $23 billion, a 34 percent increase compared to 2024.
If we dig down into the numbers, we find an important development: Sea was profitable across all segments, including Shopee. Last year was a good year for big consumer-facing tech firms in Southeast Asia. Grab, one of Sea’s main competitors in the consumer space, reached profitability for the first time. This tells us that these massive platforms with huge market share and user bases are finally starting to perform the way investors and markets expected years ago.
Sea has always enjoyed a key advantage over other regional tech giants like Grab and GoTo. Those companies started out as ride-hailing and delivery platforms, which are businesses with low margins. Sea started out as an online gaming platform called Garena. Only later did it branch out into e-commerce, deliveries and financial services. And even now, its gaming arm continues to account for the majority of the company’s profits.
What this has allowed Sea to do is grow Shopee over the long-term, even while taking huge losses, because the losses could be cross-subsidized by earnings from Garena. This is part of the reason the Go-Jek merger with Tokopedia didn’t work. Tokopedia, like Shopee, was a big loss-maker but so was Go-Jek. There was no money-maker like Garena to carry the losses at Tokopedia until it could become big enough to be profitable.
In 2025, Shopee finally became big enough. Profit margins are still thin but with e-commerce the market share is as important, if not more so, than net income. Last year, Shopee generated $127 billion worth of transactions from around 400 million buyers and 20 million sellers. Each time a merchant lists a product on Shopee or a consumer buys a product, they also become a potential customer for Sea’s other services such as digital lending which is becoming an increasingly important and profitable line of business.
On thing to note is that although Sea’s financial and operational numbers look good, it’s not showing up in the stock price which has been steadily declining since September of last year. Even though Sea booked $1.6 billion in profit in 2025, this was apparently below what the market was expecting and it led to a sell-off in early March.
This is an interesting window into the logic, such as it is, of market valuations for big tech companies. Just as Sea has finally begun to show that its vision of an expansive e-commerce platform that touches virtually every area of consumer life is workable and can be translated into consistent profits, the market sends the signal that this is not good enough.