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Sea Ltd. is Singapore’s most successful startup turned major tech company.
Six months ago, it was going head-to-head with DBS for the title of the most valuable company in the city-state, exceeding US$100 billion in market capitalisation.
That number has now shrunk to just over US$40 billion.
This is despite the numbers it keeps reporting, which are, by almost any objective measure, excellent.
For the full year of 2025, Sea generated a net income of S$1.985 billion—which is more than three times what it earned in 2024—on the back of nearly S$30 billion in revenue (a 30% increase), as Shopee continues to dominate regional ecommerce with a reported 52% market share in Southeast Asia.
One could have understood the post-pandemic slide, when markets tumbled in late 2021, and money retreated from unproven companies burning billions of dollars raised from investors each year to fuel their unprofitable expansion. At one point, Sea had even lost nearly 90% off its peak 2021 value, and some questioned whether it is able to survive on its own.
However, after hitting its bottom valuation around 2023, it has made a successful turnaround and transformed into a mature business that not only is in control of its destiny but continues to grow at an impressive pace, while expanding its offer with financial services through its Monee arm, which has increased its lending by 80% over the past year.
Its survival is not under threat anymore, as it has amassed US$11 billion (S$14 billion) in cash stash that it can deploy to make investments into its future.
If it’s so good, then why is it so bad?
It’s not the company that’s unpredictable, but the market
Sea’s decline in value appears to be due to its continued treatment as a growth stock.
Despite market dominance, which saw Shopee push its main ecommerce rival Lazada to the sidelines, Sea is not treated as a household brand, but rather an exotic and unpredictable stock, regardless of its current performance.
Not the great news of today, but the uncertainty about tomorrow is what’s making people cautious.
The rapid rise of TikTok Shop across Asia—which has managed to grab double digit share in several countries (up to 40% in Vietnam)—may have spooked investors into thinking that Sea’s best days are over and that it may not be able to compete with the social media behemoth who has access to a captive audience that Sea has to pay for.
This may have encouraged stockholders to cash in on their substantial gains from the previous two years (when Sea outperformed alternative investments like crypto or Nvidia) and wait to see the results of the rivalry.
Shopee’s first few years in business were marked by competition with an already established Lazada, which was acquired by Chinese giant Alibaba as a foothold in Southeast Asia. The Singaporean startup has eventually defeated the incumbent to take its place.
Now that it has established itself as the market leader, it is facing a challenge from another competitor. Just like in 2023, when it had to prove it could stand on its own two feet, today, it has to show it can do more than just defend its holdings and continue to grow them at an impressive pace.
The bar set by the markets keeps getting higher. Forrest Li has managed to clear it every time. Can he do it again?
The future of his company, and his fortune, depends on it.
- Read other articles we’ve written on Singaporean businesses here.
Featured Image Credit: Sea Ltd.
