Sea Ltd (NYSE:SE) shares are moving sharply lower in pre-open Tuesday after the company reported worse-than-expected Q1 results.
Sea posted a profit per share of $0.15 on revenue of $3 billion, missing the consensus for earnings of $0.68 per share on sales of $3.06B. The underperformance was fueled by weaker-than-expected sales in the Digital entertainment business unit.
This segment reported 491.6 million active users, ahead of the expected 457.9M. However, the number of paying users was only 37.6M, a large miss compared to the expected 41M.
“The first quarter of 2023 was another strong quarter for us,” said Forrest Li, Sea’s chairman and group chief executive officer.
“We are also pleased with the progress we have made so far to strengthen the fundamentals of our business. As we continue to fine-tune our operations and navigate near-term macro uncertainties, we remain highly confident in the long-term opportunities in our markets and our ability to capture those profitably.”
Sea shares trade nearly 9.5% lower in premarket Tuesday. The stock is up almost 70% year-to-date.