Pang Vit

Pang Vit inquired about Sea Limited's E-commerce growth guidance of over 25% year-on-year for 2025, seeking details on its drivers, competitive landscape assumptions, and implications for margin trends into 2026. Additionally, Pang Vit asked for clarification on the E-commerce margin trend, which decreased to 0.6% despite a higher take rate, specifically identifying investment areas like fulfillment, their nature (fixed/variable), and the expected duration and scale of this investment cycle.

Answer

Management, primarily Tony Hou (CFO), explained that the 25%+ growth guidance for 2025 is based on current market momentum and competitive landscapes. Regarding E-commerce margins, Tony Hou reiterated the target of 2-3% EBITDA margin with year-on-year improvement, attributing quarter-to-quarter fluctuations to seasonality, investment cycles in initiatives like logistics and fulfillment capabilities, and buyer engagement programs such as Shopee VIP. He clarified that most investments are asset-light and less fixed, contributing to growth and improved buyer frequency and active users.

Pang Vit from Goldman Sachs inquired about the drivers and competitive landscape behind Sea Limited's 2025 growth guidance of over 25% for Shopee, its implications for margin trends, and the outlook for 2026. He also asked for clarification on the e-commerce margin trend, specifically the investment areas (like fulfillment), their fixed or variable nature, and the expected duration and scale of this investment cycle.

Answer

Forrest Li, Chairman and CEO, stated that the growth guidance reflects current market momentum and competitive landscapes. Regarding margins, he noted consistent year-over-year improvement despite quarter-to-quarter fluctuations due to seasonality or investment cycles, reiterating a target of 2-3% EBITDA margin with annual improvement. Li explained investments are focused on logistics and fulfillment capabilities, adopting an asset-light approach, and deepening buyer engagement through programs like Shopee VIP. Chris Wang, President, added that these investments are less fixed, contribute to growth, and while there's early investment in VIP programs, they are expected to become profitable.

Pang Vit asked about the competitive landscape in Indonesia, seeking insights into Grab's growth and outperformance against peers, and also inquired about the rationale behind the increased guidance, requesting a segment-wise breakdown.

Answer

President and COO Alex Hungate highlighted strong performance in Indonesia, driven by product-led growth, increased MTUs from affordability strategies (Grab Bike/Car Saver) and high-value services (Grab Executive, priority food delivery), and growth in Grab Mart. CFO Peter Oey attributed the raised guidance to robust top-line growth across deliveries (26%), mobility (20%), and financial services (40% revenue), coupled with disciplined cost management and improved operating leverage, anticipating Q4 to be the strongest quarter.

Pang Vit inquired about Grab's competitive landscape, specifically in Indonesia, seeking color on growth achieved and factors driving outperformance. Additionally, Pang Vit asked for details on the increased guidance, including a breakdown by segment.

Answer

President and COO Alex Hungate explained that Grab's product-led growth strategy, including affordability initiatives like GrabBike/GrabCar Saver and high-value services like GrabExecutive, is driving strong MTU growth and sequential margin improvement in Indonesia. CFO Peter Oey attributed the increased guidance to strong top-line growth across deliveries, mobility, and financial services, coupled with disciplined cost management and operating leverage, expecting Q4 2025 to be the strongest quarter.