• Sea Limited recently reported a past quarter with revenue up 38% and gross merchandise value up 28%, but Shopee’s adjusted EBITDA margin slipped to 0.6% as management continued to reinvest in logistics, fulfillment, and its VIP membership program.

• This combination of strong top-line momentum and renewed emphasis on growth over near-term profitability has shifted how investors and analysts are framing Sea’s risk‑reward trade‑off.

• We’ll now examine how Sea’s choice to prioritize Shopee growth investments over margin expansion influences the company’s broader investment narrative.

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To own Sea today, you have to believe that management can balance Shopee’s growth ambitions with sustainable, cash-generative profitability across e‑commerce, gaming, and fintech. The recent quarter, with revenue up 38% and GMV up 28% but Shopee’s adjusted EBITDA margin slipping to 0.6%, reinforces that Sea is again leaning into growth, even at the cost of near term margin pressure. That slightly shifts the near term catalyst set: instead of pure focus on earnings leverage and buyback support, the spotlight swings back to user growth, engagement, and returns on logistics and VIP investments. The authorized US$1.00 billion buyback and solid profitability over the last two years still underpin confidence, but the sharp share price pullback suggests the market is reassessing execution risk around this renewed investment phase.

However, there is one execution risk in Shopee’s reinvestment push that investors should not ignore. Despite retreating, Sea’s shares might still be trading above their fair value and there could be some more downside. Discover how much.

In the Simply Wall St Community, 17 private investors currently see Sea’s fair value between US$155.87 and US$275.91, highlighting very different expectations. Set this against Sea’s renewed focus on Shopee reinvestment and margin volatility, and you can see why it helps to weigh multiple viewpoints before forming a view on how the story might evolve.

Explore 17 other fair value estimates on Sea – why the stock might be worth over 2x more than the current price!

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