Sea Limited’s digital finance arm recorded revenues of $1.2 billion in the first three quarters of 2025, representing a 45% year-over-year increase. The unit’s loan book grew to $3.5 billion, up from $2.3 billion a year earlier, driven by merchant lending on the Shopee platform and consumer ‘buy now, pay later’ products. This segment now accounts for roughly 25% of Sea’s overall quarterly revenues, versus 18% in the same period of 2024, underscoring its rising strategic importance for the Singapore-based Internet group.

Credit loss provisions at Sea Limited’s finance arm more than doubled to $380 million in Q3 2025, up from $170 million in Q3 2024, as delinquencies among small-ticket loans climbed to 6.8% of the receivables portfolio. The provision coverage ratio rose from 4.5% to 7.2%, reflecting management’s cautious stance on credit quality. As a result, the finance division swung to an operating loss of $45 million in Q3, compared with a $25 million profit in the prior-year quarter, weighing heavily on consolidated margins.

Overall operating expenses climbed 38% year-over-year to $2.1 billion in the first nine months of 2025, driven by higher marketing spend for Shopee’s mobile app and expanded headcount in the finance unit. Selling, general and administrative expenses now consume 52% of group revenues, up from 47% in 2024. EBITDA margin contracted to 12% in Q3, down from 18% a year earlier, reflecting both elevated customer acquisition costs and the sharp increase in loan-loss provisioning.

Looking ahead, Sea Limited has earmarked $200 million for upgrading its credit risk management platform and plans to tighten lending criteria in underperforming markets. Management forecasts finance receivables growth of 20%–25% in 2026, compared with 35% in 2025, aiming to stabilize the loss rate below 5%. Investors will closely monitor whether cost optimization measures and enhanced underwriting can restore profitability in the digital finance arm without stalling its high-growth trajectory.