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What changed in Sea Ltd's 20-F — 2023 vs 2024

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Paragraph-level year-over-year comparison of Sea Ltd's 2023 and 2024 20-F annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+800 added−877 removedSource: 20-F (2025-04-17) vs 20-F (2024-04-26)

Top changes in Sea Ltd's 2024 20-F

800 paragraphs added · 877 removed · 601 edited across 5 sections

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

199 edited+80 added−54 removed325 unchanged
Biggest changeRisk Factors SUMMARY OF RISK FACTORS We believe some of the major risks and uncertainties that may materially and adversely affect us include the following: BUSINESS AND OPERATIONAL RELATED RISKS Risks Applicable Across Multiple Businesses • We may fail to maintain or grow the size of our user base or the level of engagement of our users. • Changes in macro-economic, geopolitical or social conditions or government policies, or government actions or restrictions, globally and in our markets could have a material adverse effect on our business and operations. • We have a history of net losses and we may not remain profitable in the future. • Our results of operations are subject to fluctuations. • We may fail to monetize our businesses effectively. 7 Table of Contents • Any future occurrence of natural disasters, epidemics, pandemics or other outbreaks, or other catastrophic events could also adversely affect our business. • We may not succeed in managing or expanding our business across the expansive and diverse markets in which we operate. • We are subject to extensive and changing laws and government regulations across our business. • We may fail to compete effectively. • Existing or future investments or acquisitions may not be successful. • We have a limited operating history for some of our businesses. • Our businesses involve third parties over whose actions we have no control. • Fluctuations in foreign currency exchange rates may adversely affect our operational and financial results, which we report in U.S. dollars. • We may be subject to intellectual property-related risks. • We may be liable for security breaches and attacks against our or our third-party partners’ platforms and network, particularly with regard to confidential user information and personal or other data or any other privacy or data protection compliance issue, and our platforms and games may contain unforeseen “bugs”, vulnerabilities or errors. • We collect, process, transmit, and store personal information in connection with the operation of our businesses and are subject to complex and evolving international laws and regulations regarding privacy and data protection. • We may use artificial intelligence in our business, and challenges with properly managing its use could adversely affect our results of operations.
Biggest changeRisk Factors SUMMARY OF RISK FACTORS We believe some of the major risks and uncertainties that may materially and adversely affect us include the following: BUSINESS AND OPERATIONAL RELATED RISKS Risks Applicable Across Multiple Businesses • We may fail to maintain or grow the size of our user base or the level of engagement of our users. • Changes in macro-economic, geopolitical or social conditions or government policies, or government actions or restrictions, globally and in our markets could have a material adverse effect on our business and operations. • Our results of operations are subject to fluctuations. • We are subject to extensive and changing laws and government regulations across our business. • We face competition in our businesses. • We may be subject to intellectual property-related risks. 7 Table of Contents • Existing or future investments or acquisitions may not be successful. • Our businesses involve third parties over whose actions we have no control. • Fluctuations in foreign currency exchange rates may adversely affect our operational and financial results, which we report in U.S. dollars. • We may have exposure to greater than anticipated tax liabilities, and our financial position and results of operations may be adversely affected by the implementation of legislation or internationally accepted principles. • We may use artificial intelligence (“AI”) in our business, and challenges with properly managing its use or more successful use of AI by our competitors could adversely affect our business and results of operations. • We may be liable for security breaches and attacks against our or our third-party partners’ platforms and network, particularly with regard to confidential user information and personal or other data or any other privacy or data protection compliance issue, and our platforms and games may contain unforeseen “bugs”, vulnerabilities or errors. • We collect, process, transmit, and store personal information in connection with the operation of our businesses and are subject to complex and evolving international laws and regulations regarding privacy and data protection. • We may not succeed in managing or expanding our business across the expansive and diverse markets in which we operate. • We have a history of net losses and we may not remain profitable in the future. • Any future occurrence of natural disasters, epidemics, pandemics or other outbreaks, or other catastrophic events could also adversely affect our business.
The use of AI applications may result in data leakage or unauthorized use or exposure of personal data, or other information. Such leakage or unauthorized use or exposure of personal data related to or arising from our use of AI applications could result in legal claims or liability.
The use of AI applications may result in data leakage or unauthorized use or exposure of personal data, or other information. Such leakage or unauthorized use or exposure of personal data related or other information to or arising from our use of AI applications could result in legal claims or liability.
We may not be able to control the actions of these or other third parties and thus are subject to various risks associated with working with or relying on third parties in our businesses, including: • risks relating to third-party sellers on our platforms and merchant partners, including deficiencies in the quality of products, misrepresentations of or about products, listing or sale of restricted or prohibited products, failure to comply with applicable laws and regulations, and potential intellectual property issues (see “—We may be subject to intellectual property-related risks”); • risks relating to third-party publishing or distribution channels we use to make our applications available for download, such as the iOS App Store and the Google Play Store; • risks relating to content generated by third parties and any user generated content in our games (see “—We rely on third-party game developers for some of our digital entertainment content and also allow our users to contribute and interact with user generated content”), e-commerce platform, or other platforms, including content posted in real-time, which may be illegal, obscene, defamatory, infringing or otherwise inappropriate or unlawful; • risks relating to third-party payment service providers we depend on to provide users with various payment options or mobile wallet top-up options, such as the iOS App Store and the Google Play Store, payment on delivery, bank transfers, direct carrier billing, credit cards, debit cards, telecommunication card and over-the-counter top-up and payment through other third-party payment services; • risks relating to services by third-party logistics service providers (see “—We face risks related to logistics and fulfillment”); • risks relating to third party developers and independent software vendors; 19 Table of Contents • risks relating to third party collection agents in relation to our credit products and loans receivable; • risks relating to manpower agencies and independent contractors (see “—We face manpower-related risks”); • risks relating to business process outsourcing vendors, including customer service agents; • risks relating to users’ personal data that is received or used by third parties in connection with our services, such as when sellers or third-party payments or logistics providers receive user information in connection with payment services or order fulfillment; • risks relating to third party banks, insurance, lending and wealth management service providers providing services on our platforms.
We may not be able to control the actions of these or other third parties and thus are subject to various risks associated with working with or relying on third parties in our businesses, including: • risks relating to third-party sellers on our platforms and merchant partners, including deficiencies in the quality of products, misrepresentations of or about products, listing or sale of restricted or prohibited products, failure to comply with applicable laws and regulations, and potential intellectual property issues (see “—We may be subject to intellectual property-related risks”); • risks relating to third-party publishing or distribution channels we use to make our applications available for download, such as the iOS App Store and the Google Play Store; • risks relating to content generated by third parties and any user generated content in our games (see “—We rely on third-party game developers for some of our digital entertainment content and also allow our users to contribute and interact with user generated content”), e-commerce platform, or other platforms, including content posted in real-time, which may be illegal, obscene, defamatory, infringing or otherwise inappropriate or unlawful; • risks relating to third-party payment service providers we depend on to provide users with various payment options or mobile wallet top-up options, such as the iOS App Store and the Google Play Store, payment on delivery, bank transfers, direct carrier billing, credit cards, debit cards, telecommunication card and over-the-counter top-up and payment through other third-party payment services; 18 Table of Contents • risks relating to services by third-party logistics service providers (see “—We face risks related to logistics and fulfillment”); • risks relating to third party developers and independent software vendors; • risks relating to third party collection agents in relation to our credit products and loans receivable; • risks relating to manpower agencies and independent contractors (see “—We face manpower-related risks”); • risks relating to business process outsourcing vendors, including customer service agents; • risks relating to users’ personal data that is received or used by third parties in connection with our services, such as when sellers or third-party payments or logistics providers receive user information in connection with payment services or order fulfillment; • risks relating to third party banks, insurance, lending and wealth management service providers providing services on our platforms.
Investments and acquisitions entail uncertainties and risks, such as: 17 Table of Contents • we may fail to successfully achieve the intended objectives; • our investments or acquisitions may be viewed negatively by customers, financial markets or investors; • the costs of identifying and consummating these transactions may be significant; • acquisitions and the subsequent integration of new assets and businesses into our own could require significant management attention and could divert resources from our existing businesses; • we may have difficulty in transitioning and integrating the business, technologies, products, personnel or operations of the acquired businesses; • we may face unforeseen operating challenges; • our relationships with existing employees, customers and business partners of our group, or those of the target, may be impaired; • we may assume pre-existing contractual relationships of an acquired company that we would not have otherwise entered into, the termination or modification of which may be costly or disruptive to our business; • an acquisition may result in a delay or reduction of customer purchases for both us and the company acquired due to customer uncertainty about continuity and effectiveness of service from either company; • we may face challenges associated with managing additional and/or geographically remote businesses; • investments and acquisitions could result in the use of substantial amounts of cash or significant capital contributions, which could limit other potential uses for our cash; • investments and acquisitions could result in increased leverage, dilutive issuances of equity securities, adverse tax consequences, goodwill impairment charges, investment impairment charges or write-offs, and amortization expenses for other intangible assets; • if we incur debt to fund any investments or acquisitions, such debt may subject us to material restrictions on our ability to conduct our business, including financial maintenance covenants; • we may need to issue new shares as acquisition consideration or to raise additional capital to fund the acquisition consideration, which may dilute our existing investors’ interest in us; • we may assume unknown material liabilities of acquired companies, or may be exposed to claims and disputes by shareholders and third parties, including intellectual property claims and disputes; • we may be unsuccessful in accurately projecting revenue, cost or other metrics of the invested or acquired entity in the due diligence process; • the invested or acquired assets or businesses may not generate the financial results we expect; and • the market value of our investments or acquisitions may fluctuate, particularly in volatile markets, or they may become obsolete. 18 Table of Contents These factors could adversely affect our financial results.
Investments and acquisitions entail uncertainties and risks, such as: • we may fail to successfully achieve the intended objectives; • our investments or acquisitions may be viewed negatively by customers, financial markets or investors; • the costs of identifying and consummating these transactions may be significant; • acquisitions and the subsequent integration of new assets and businesses into our own could require significant management attention and could divert resources from our existing businesses; • we may have difficulty in transitioning and integrating the business, technologies, products, personnel or operations of the acquired businesses; • we may face unforeseen operating challenges; • our relationships with existing employees, customers and business partners of our group, or those of the target, may be impaired; • we may assume pre-existing contractual relationships of an acquired company that we would not have otherwise entered into, the termination or modification of which may be costly or disruptive to our business; • an acquisition may result in a delay or reduction of customer purchases for both us and the company acquired due to customer uncertainty about continuity and effectiveness of service from either company; • we may face challenges associated with managing additional and/or geographically remote businesses; • investments and acquisitions could result in the use of substantial amounts of cash or significant capital contributions, which could limit other potential uses for our cash; • investments and acquisitions could result in increased leverage, dilutive issuances of equity securities, adverse tax consequences, goodwill impairment charges, investment impairment charges or write-offs, and amortization expenses for other intangible assets; • if we incur debt to fund any investments or acquisitions, such debt may subject us to material restrictions on our ability to conduct our business, including financial maintenance covenants; 17 Table of Contents • we may need to issue new shares as acquisition consideration or to raise additional capital to fund the acquisition consideration, which may dilute our existing investors’ interest in us; • we may assume unknown material liabilities of acquired companies, or may be exposed to claims and disputes by shareholders and third parties, including intellectual property claims and disputes; • we may be unsuccessful in accurately projecting revenue, cost or other metrics of the invested or acquired entity in the due diligence process; • the invested or acquired assets or businesses may not generate the financial results we expect; and • the market value of our investments or acquisitions may fluctuate, particularly in volatile markets, or they may become obsolete.
In addition, any breach, compromise, or failure to otherwise detect or prevent fraudulent activity involving our data security systems, could result in us being subject to significant fines and higher transaction fees, and loss of our ability to accept credit and debit card payments from our customers, process electronic funds transfers, or facilitate other types of online payments.
In addition, any breach, compromise, or failure to otherwise detect or prevent fraudulent activity involving our data security systems could result in us being subject to significant fines and higher transaction fees, and loss of our ability to accept credit, debit or prepaid card payments from our customers, process electronic funds transfers, or facilitate other types of online payments.
Our ability to achieve or maintain market acceptance for our digital financial services and products are affected by a number of factors, such as the community’s lack of trust in digital financial services and products being provided by a company that is not a traditional financial institution, entrenched preferences in traditional payment methods, insufficient use cases for our digital payment services and lack of infrastructure support locally.
Our ability to achieve or maintain market acceptance for our digital financial services and products are affected by a number of factors, such as the community’s lack of trust in digital financial services and products being provided by a company that is not a traditional financial institution, entrenched preferences in traditional payment or funding methods, insufficient use cases for our digital payment services and lack of infrastructure support locally.
If any of these occurrences results in our inability to direct the activities of our VIEs or Thai subsidiaries that most significantly impact such entity’s economic performance, or prevent us from receiving the economic benefits or absorbing losses from such entity, we may not be able to consolidate the entity in our consolidated financial statements in accordance with U.S.
If any of these occurrences results in our inability to direct the activities of our VIEs or Thai subsidiaries that most significantly impact such entity’s economic performance, or prevent us from receiving the economic benefits or absorbing losses from such entity, we may not be able to consolidate the entity in our consolidated financial statements in accordance with U.S. GAAP.
If, as a result of changes to law or regulation or for any other reason, we are required to reclassify our contingent workforce as employees, we may incur significant additional expenses for manpower costs, including expenses associated with the application of wage and hour laws, benefits, social security contributions, taxes, and potential penalties.
If, as a result of changes to law or regulation or for any other reason, we are required to reclassify members of our contingent workforce as employees, we may incur significant additional expenses for manpower costs, including expenses associated with the application of wage and hour laws, benefits, social security contributions, taxes, and potential penalties.
In addition, in September 2022, Tencent granted an irrevocable voting proxy with respect to all its Class A ordinary shares to our board of directors to vote on matters that are subject to the vote of shareholders of Sea. Such proxy gives our board of directors (duly constituted from time to time) approximately 8.6% of voting power. See “Item 6.
In addition, in September 2022, Tencent granted an irrevocable voting proxy with respect to all its Class A ordinary shares to our board of directors to vote on matters that are subject to the vote of shareholders of Sea. Such proxy gives our board of directors (duly constituted from time to time) approximately 8.5% of voting power. See “Item 6.
Accordingly, we may experience periods with excess underwriting capacity and unfavorable premium rates, and if we cannot underwrite insurance at appropriate rates, our ability to transact business will be materially and adversely affected. We must accurately and timely evaluate and pay claims that are made under our policies.
Accordingly, we may experience periods with excess underwriting capacity and unfavorable premium rates, and if we cannot underwrite insurance at appropriate rates, our ability to transact business will be materially and adversely affected. We must accurately and timely evaluate and pay claims that are made under the policies we underwrite.
If local authorities find that our arrangements do not comply with their prohibition or restrictions on foreign investment in our lines of business, or if the relevant government otherwise finds that we or any of our subsidiaries, VIEs or their subsidiaries are in violation of the relevant laws or regulations or lack the necessary registrations, permits or licenses to operate our businesses in such jurisdictions, they would have broad discretion in dealing with such violations or failures, including: • revoking the business licenses and/or operating licenses of such entities; • discontinuing or placing restrictions or onerous conditions on the operations of our VIEs or Thai subsidiaries, or on our operations through any transactions between our company or our Cayman Islands or Singapore subsidiaries on the one hand and our VIEs, subsidiaries of such VIEs or our Thai subsidiaries on the other hand; • imposing fines, prohibiting payments by our VIEs or their shareholders to us as contemplated in the contractual arrangements with our VIEs, confiscating income from us, our Cayman Islands or Singapore subsidiaries, VIEs or Thai subsidiaries, or imposing other requirements with which such entities may not be able to comply; • imposing criminal penalties, including fines and imprisonment on our VIEs or Thai subsidiaries, their shareholders or directors; • requiring us to restructure our ownership structure or operations, including terminating the contractual arrangements with our VIEs and their shareholders, which in turn would affect our ability to consolidate, derive economic interests from, or exert effective control over our VIEs or Thai subsidiaries; or • restricting or prohibiting us from providing funding to our business and operations in Vietnam and Thailand.
If local authorities find that our arrangements do not comply with their prohibition or restrictions on foreign investment in our lines of business, or if the relevant government otherwise finds that we or any of our subsidiaries, VIEs or their subsidiaries are in violation of the relevant laws or regulations or lack the necessary registrations, permits or licenses to operate our businesses in such jurisdictions, they would have broad discretion in dealing with such violations or failures, including: • revoking the business licenses and/or operating licenses of such entities; • discontinuing or placing restrictions or onerous conditions on the operations of our VIEs or Thai subsidiaries, or on our operations through any transactions between our company or our Cayman Islands or Singapore subsidiaries on the one hand and our VIEs, subsidiaries of such VIEs or our Thai subsidiaries on the other hand; • imposing fines, prohibiting payments by our VIEs or their shareholders to us as contemplated in the contractual arrangements with our VIEs, confiscating income from us, our Cayman Islands or Singapore subsidiaries, VIEs or Thai subsidiaries, or imposing other requirements with which such entities may not be able to comply; • imposing criminal penalties, including fines and imprisonment on our VIEs or Thai subsidiaries, their shareholders or directors; • requiring us to restructure our ownership structure or operations, including terminating the contractual arrangements with our VIEs and their shareholders, which in turn would affect our ability to consolidate, derive economic interests from, or exert effective control over our VIEs or Thai subsidiaries; or 39 Table of Contents • restricting or prohibiting us from providing funding to our business and operations in Vietnam and Thailand.
In addition to market and industry factors, the price and trading volume for the ADSs may be highly volatile for factors specific to our own operations, including the following: • variations in our quarterly or annual revenue, earnings and cash flow; • guidance or other projections we may provide to the public, including any changes or failure to meet any guidance or other projections; • announcements of new investments, acquisitions, strategic partnerships or joint ventures by us or our competitors; • announcements of new content and services or plans of expansion or exits by us or our competitors; • changes in financial estimates by securities analysts and data providers, or our failure to meet these estimates or the expectations of investors; • downgrades by industry or securities analysts that publish research or reports on us; • detrimental adverse publicity about us, our businesses or our industries or investor sentiment with respect to our competitors, our shareholders and investors, and our industry in general; • additions or departures of key personnel; • release of lock-up or other transfer restrictions on our outstanding equity securities or sales of additional equity securities, including the perception that these sales could occur; • dilution of the ownership interests of our ADS holders due to conversions of our 2024, 2025 and 2026 convertible notes, which we may choose to settle by issuing ADSs, or from the unwinding of capped call transactions in connection with our 2024 and 2025 convertible notes; • current or potential litigation, government actions or regulatory investigations, including class actions; • volatility in the stock market, including price and volume fluctuations in the overall stock market, changing trends in the economy, interest rate hikes or other interest rate-related decisions; and • general political, economic, or market conditions, or other events or factors, including those resulting from war, incidents of terrorism, pandemics, and other disruptive external events, or responses to these events.
In addition to market and industry factors, the price and trading volume for the ADSs may be highly volatile for factors specific to our own operations, including the following: • variations in our quarterly or annual revenue, earnings and cash flow; • guidance or other projections we may provide to the public, including any changes or failure to meet any guidance or other projections; • announcements of new investments, acquisitions, strategic partnerships or joint ventures by us or our competitors; • announcements of new content and services or plans of expansion or exits by us or our competitors; • changes in financial estimates by securities analysts and data providers, or our failure to meet these estimates or the expectations of investors; • downgrades by industry or securities analysts that publish research or reports on us; 44 Table of Contents • detrimental adverse publicity about us, our businesses or our industries or investor sentiment with respect to our competitors, our shareholders and investors, and our industry in general; • additions or departures of key personnel; • release of lock-up or other transfer restrictions on our outstanding equity securities or sales of additional equity securities, including the perception that these sales could occur; • dilution of the ownership interests of our ADS holders due to conversions of our 2025 and 2026 convertible notes, which we may choose to settle by issuing ADSs, or from the unwinding of capped call transactions in connection with our 2025 convertible notes; • current or potential litigation, government actions or regulatory investigations, including class actions; • volatility in the stock market, including price and volume fluctuations in the overall stock market, changing trends in the economy, interest rate hikes or other interest rate-related decisions; and • general political, economic, or market conditions, or other events or factors, including those resulting from war, incidents of terrorism, pandemics, and other disruptive external events, or responses to these events.
Our user base and engagement could be adversely affected if: • we fail to maintain the popularity of our platforms among users; • we are unable to maintain the quality of our existing content and services; • we are unsuccessful in innovating or introducing new, best-in-class content and services; • we fail to adapt to changes in user preferences, market trends or advancements in technology; • technical, regulatory, governmental or other reasons prevent us from delivering our content or services in a timely and reliable manner, or at all, or otherwise affect the user experience; • there are user concerns related to privacy, data protection, safety, fund security or other factors; • monetization and cost reduction measures by us cause users to reduce their activity on our platforms or shift to other platforms; 9 Table of Contents • new games cause players to shift from our existing games without growing the overall size of our user base or online games platform; • there are adverse changes to our platforms or offerings that are mandated by, or that we elect to make, to address legislation, regulation, government orders, or litigation, including settlements or consent decrees; • our users fail to accept or comply with our terms of service or the privacy policies that we have implemented or may implement, or we adopt terms, policies, or procedures that are perceived negatively by our users; • our marketing campaigns or promotional strategies fail to achieve the intended effect among users – for example, users may develop negative perceptions towards our marketing campaigns or promotional strategies; • we are unable to achieve the expected synergies among our businesses, we are unable to achieve synergies in a cost-effective manner, or we fail to balance the interests of all participants in our ecosystem; • we fail to maintain the brand image of our platforms or our reputation is damaged or changes negatively; or • changes to demographic trends or economic development affect our markets.
Our user base and engagement could be adversely affected if: • we fail to maintain the popularity of our platforms among users; • we are unable to maintain the quality of our existing content and services; • we are unsuccessful in innovating or introducing new, best-in-class content and services; • we fail to adapt to changes in user preferences, market trends or advancements in technology, including AI; • technical, regulatory, governmental or other reasons prevent us from delivering our content or services in a timely and reliable manner, or at all, or otherwise affect the user experience; • there are user concerns related to privacy, data protection, safety, fund security or other factors; • monetization and cost reduction measures by us cause users to reduce their activity on our platforms or shift to other platforms; • new games cause players to shift from our existing games without growing the overall size of our user base or online games platform; • there are adverse changes to our platforms or offerings that are mandated by, or that we elect to make, to address legislation, regulation, government orders, or litigation, including settlements or consent decrees; • our users fail to accept or comply with our terms of service or the privacy policies that we have implemented or may implement, or we adopt terms, policies, or procedures that are perceived negatively by our users; • our marketing campaigns or promotional strategies fail to achieve the intended effect among users – for example, users may develop negative perceptions towards our marketing campaigns or promotional strategies; • we are unable to achieve the expected synergies among our businesses, we are unable to achieve synergies in a cost-effective manner, or we fail to balance the interests of all participants in our ecosystem; • we fail to maintain the brand image of our platforms or our reputation is damaged or changes negatively; or • changes to demographic trends or economic development affect our markets.
However, fluctuations in the exchange rates among the various currencies that we use could cause fluctuations in our operational and financial results. Our expenses may become higher and our revenue and operating metrics may become lower than would be the case if exchange rates were stable or if we were operating and reporting in one currency.
Fluctuations in the exchange rates among the various currencies that we use could cause fluctuations in our operational and financial results. Our expenses may become higher and our revenue and operating metrics may become lower than would be the case if exchange rates were stable or if we were operating and reporting in one currency.
We are subject to a variety of regulations, including those relating to game operations, game ratings, e-commerce, social networking, internet applications or content services, digital platforms, marketing, advertising, artificial intelligence technology and services, privacy, personal information, data use, data transfer, data processing, data localization, data storage, data retention and data protection, livestreaming services, antitrust or competition laws, employment and labor laws, national language requirements, intellectual property, virtual items, user generated content, loot boxes, national security, nationalization, content restrictions, platform regulations, sale of regulated or prohibited items, protection of minors, data of minors, consumer protection, pricing, product safety and product liability, prevention of money laundering and financing criminal activity and terrorism, anti-bribery and anti-corruption regulation, economic or other trade prohibitions or sanctions, electronic contracts and other communications, digital financial services regulation, electronic payment services regulation, lending regulation, foreign investment and currency control regulation and regulations related to logistics, insurance, and banking.
We are subject to a variety of regulations, including those relating to game operations, game ratings, e-commerce, social networking, internet applications or content services, digital platforms, marketing, advertising, AI technology and services, privacy, personal information, data use, data transfer, data processing, data localization, data storage, data retention and data protection, livestreaming services, antitrust or competition laws, employment and labor laws, national language requirements, intellectual property, virtual items, user generated content, loot boxes, national security, nationalization, content restrictions, platform regulations, sale of regulated or prohibited items, protection of minors, data of minors, consumer protection, pricing, product safety and product liability, prevention of money laundering and financing criminal activity and terrorism, anti-bribery and anti-corruption regulation, economic or other trade prohibitions or sanctions, electronic contracts and other communications, digital financial services regulation, electronic payment services regulation, lending regulation, foreign investment and currency control regulation and regulations related to logistics, insurance, and banking.
If such tension intensifies, our business in Taiwan might not be able to operate normally or at all. Such tensions or any deteriorations in relations among the U.S., Taiwan and the PRC may negatively impact our ability to continue to do business in Taiwan.
If such tension intensifies, our business in Taiwan may not be able to operate normally or at all. Such tensions or any deteriorations in relations among the U.S., Taiwan and the PRC may negatively impact our ability to continue to do business in Taiwan.
GAAP upon consolidation; • compliance with privacy laws and data security laws and compliance costs across different legal systems; • currency exchange rate fluctuations; • protectionist laws and business practices that could, among other things, hinder our ability to execute our business strategies and put us at a competitive disadvantage relative to domestic companies, including restrictions on foreign ownership ; • actions by governments or others to restrict access to our products and services, whether these actions are taken for political, security or other reasons, or that may cause us to discontinue our operations in a particular market; • complex local tax regimes; • differing, complex and potentially adverse customs, import/export laws, tax rules and regulations or other trade barriers or restrictions which may be applicable to transactions conducted through cross-border e-commerce business, related compliance obligations and consequences of non-compliance, and any new developments in these areas; • establishing strategic partnerships, as well as maintaining our relationships with any of our existing or future strategic partners; • potential political, economic and social instability, including future major geopolitical events, and related actions taken by other countries in response, or perceived, threatened or actual security concerns; and • higher costs associated with doing business in a larger number of markets.
GAAP upon consolidation; • compliance with privacy laws and data security laws and compliance costs across different legal systems; • currency exchange rate fluctuations; 24 Table of Contents • protectionist laws and business practices that could, among other things, hinder our ability to execute our business strategies and put us at a competitive disadvantage relative to domestic companies, including restrictions on foreign ownership; • actions by governments or others to restrict access to our products and services, whether these actions are taken for political, security or other reasons, or that may cause us to discontinue our operations in a particular market; • complex local tax regimes; • differing, complex and potentially adverse customs, import/export laws, tariff and tax rules and regulations or other trade barriers or restrictions which may be applicable to transactions conducted through cross-border e-commerce business, related compliance obligations and consequences of non-compliance, and any new developments in these areas; • establishing strategic partnerships, as well as maintaining our relationships with any of our existing or future strategic partners; • potential political, economic and social instability, including future major geopolitical events, and related actions taken by other countries in response, or perceived, threatened or actual security concerns; and • higher costs associated with doing business in a larger number of markets.
There have been and remain tensions surrounding the Taiwan Strait. Such tensions may affect the economic and social activities in Taiwan, which may in turn affect our businesses and operations in Taiwan. There has historically been imposed prohibitions and restrictions on investments, directly and indirectly, by PRC investors in Taiwan.
There have been and remain tensions surrounding the Taiwan Strait. Such tensions may affect the economic and social activities in Taiwan, which may in turn affect our businesses and operations in Taiwan. There have historically been imposed prohibitions and restrictions on investments, directly and indirectly, by PRC investors in Taiwan.
There are also jurisdictions that are considering or have passed legislation implementing data transfer restrictions or requiring local storage and processing of data or similar requirements, which could affect our business operations.
There are also jurisdictions that are considering or have passed legislation or regulations implementing data transfer restrictions or requiring local storage and processing of data or similar requirements, which could affect our business operations.
O ur operations and expansions in new markets may become subject to risks associated with: • user acceptance of a digital economy, especially in the new markets to which we may expand in the future; 13 Table of Contents • lack of experience operating in these new markets, including our ability to understand different user behaviors and/or culture in new markets and roll-out relevant products and services localized to each market’s needs or preferences; • challenges in adapting our approach and strategies in existing markets to new markets; • recruiting and retaining talented and capable management and employees in various markets; • our ability to appropriately deploy resources and management attention that otherwise would be focused on the development of our existing markets and businesses; • limited technology infrastructure and low levels of use of the internet; • challenges caused by distance, language and cultural differences, and local and regional competitive landscapes; • providing content and services that appeal to the tastes and preferences of users in a larger number of markets; • implementing our businesses in a manner that complies with local laws and practices, which may differ significantly from market to market, including laws regarding data protection, privacy, network security, cybersecurity, encryption and payments; • maintaining adequate internal and accounting control across various markets, each with its own accounting principles that must be reconciled to U.S.
Our operations and expansions in new markets may become subject to risks associated with: • user acceptance of a digital economy, especially in the new markets to which we may expand in the future; • lack of experience operating in these new markets, including our ability to understand different user behaviors and/or culture in new markets and roll-out relevant products and services localized to each market’s needs or preferences; • challenges in adapting our approach and strategies in existing markets to new markets; • recruiting and retaining talented and capable management and employees in various markets; • our ability to appropriately deploy resources and management attention that otherwise would be focused on the development of our existing markets and businesses; • limited technology infrastructure and low levels of use of the internet; • challenges caused by distance, language and cultural differences, and local and regional competitive landscapes; • providing content and services that appeal to the tastes and preferences of users in a larger number of markets; • implementing our businesses in a manner that complies with local laws and practices, which may differ significantly from market to market, including laws regarding data protection, privacy, network security, cybersecurity, encryption and payments; • maintaining adequate internal and accounting control across various markets, each with its own accounting principles that must be reconciled to U.S.
If our assessment of, assumptions used or expectations concerning the above-mentioned factors differ from actual developments, if the quality of our total loan portfolio deteriorates, for any reason, or if future actual losses exceed our estimates of expected losses, we may be required to increase our provisions for credit losses and/or be subject to increased liquidity risks, which may adversely impact our results of operation and financial condition.
If our assessment of, assumptions used or expectations concerning the above-mentioned factors differ from actual developments, if the quality of our total loan portfolio deteriorates, for any reason, or if future actual losses exceed our estimates of expected losses, we may be required to increase our provisions for credit losses and/or be subject to increased liquidity risks, which may adversely impact our results of operations and financial condition.
Social media platforms with high levels of user engagement may be able to leverage content and user connections and traffic on their platform to increase the visibility and attractiveness of a wide variety of brands and products. 16 Table of Contents Our digital financial services business faces competition from existing online and offline consumer and SME financial products and services.
Social media platforms with high levels of user engagement may be able to leverage content and user connections and traffic on their platform to increase the visibility and attractiveness of a wide variety of brands and products. 14 Table of Contents Our digital financial services business faces competition from existing online and offline consumer and SME financial products and services.
Such laws, regulations and guidelines may impose rules and/or restrictions on the type of banking products and services we offer, eligibility criteria of our customers, related party transactions, market entry, risk management, corporate governance, regulatory capital requirements, capital adequacy, liquidity and/or regulatory ratios, and tax and accounting policies, among other things.
Such laws, regulations and guidelines may impose rules and/or restrictions on the type of banking products and services we offer, eligibility criteria of our customers, related party transactions, market entry, risk management, corporate governance, regulatory capital requirements, regulatory ratios, and tax and accounting policies, among other things.
Under the deposit agreement for the ADSs, the depositary will give us a discretionary proxy to vote our Class A ordinary shares underlying our ADSs at shareholders’ meetings if holders of ADSs do not give voting instructions to the depositary, unless: • we have failed to timely provide the depositary with our notice of meeting and related voting materials; • we have instructed the depositary that we do not wish a discretionary proxy to be given; 43 Table of Contents • we have informed the depositary that there is substantial opposition as to a matter to be voted on at the meeting; or • a matter to be voted on at the meeting would have a material adverse impact on shareholders.
Under the deposit agreement for the ADSs, the depositary will give us a discretionary proxy to vote our Class A ordinary shares underlying our ADSs at shareholders’ meetings if holders of ADSs do not give voting instructions to the depositary, unless: • we have failed to timely provide the depositary with our notice of meeting and related voting materials; • we have instructed the depositary that we do not wish a discretionary proxy to be given; • we have informed the depositary that there is substantial opposition as to a matter to be voted on at the meeting; or • a matter to be voted on at the meeting would have a material adverse impact on shareholders.
For our consumer and SME credit business, we compete with other non-bank fintechs, neobanks, credit unions, multi-finance companies, off-card financing, private credit card and point-of-sale service providers, banks and larger financial institutions may also build solutions to compete in the consumer and SME lending space.
For our consumer and SME credit business, we compete with other non-bank fintech companies, neobanks, credit unions, multi-finance companies, off-card financing, private credit card and point-of-sale service providers. Banks and larger financial institutions may also build solutions to compete in the consumer and SME lending space.
Development of new games requires considerable cost and resources, including research, testing, marketing, infrastructure and staff expenses. Free Fire is currently available in more than 130 markets. Any self-developed games we may develop in the future may also be offered in multiple jurisdictions.
Development of new games requires considerable cost and resources, including research, testing, marketing, infrastructure and staff expenses. Free Fire is currently available in more than 160 markets. Any self-developed games we may develop in the future may also be offered in multiple jurisdictions.
Our management has concluded that our internal control over financial reporting is effective as of December 31, 2023. See “Item 15. Controls and Procedures—Management’s Annual Report on Internal Control over Financial Reporting.” Our independent registered public accounting firm has issued an attestation report on management’s assessment on the effectiveness of internal control over financial reporting.
Our management has concluded that our internal control over financial reporting is effective as of December 31, 2024. See “Item 15. Controls and Procedures—Management’s Annual Report on Internal Control over Financial Reporting.” Our independent registered public accounting firm has issued an attestation report on management’s assessment on the effectiveness of internal control over financial reporting.
Although we have adopted measures to reduce infringements or offense by product listings on our Shopee platform before they appear on the marketplace, these efforts may not always be successful. In January 2024, the Office of the U.S.
Although we have adopted measures to reduce infringements or offense by product listings on our Shopee platform before they appear on the marketplace, these efforts may not always be successful. In January 2025, the Office of the U.S.
While we have obtained insurance to cover certain potential risks and liabilities for certain businesses we operate, we have not insured against many other risks and liabilities (including the risk of business interruption), and the coverage of any insurance we have may be insufficient to compensate for losses that may occur.
We do not have extensive insurance coverage. While we have obtained insurance to cover certain potential risks and liabilities for certain businesses we operate, we have not insured against many other risks and liabilities (including the risk of business interruption), and the coverage of any insurance we have may be insufficient to compensate for losses that may occur.
Recent disruptions to the banking system and the surrounding speculation and uncertainty related to liquidity, solvency and capitalization of banks may negatively impact the industry’s reputation and lead to a level of distrust towards banks, especially in relation to new entrants or smaller scale players like us, which could adversely affect our banking business’ ability to access additional funds and attract more customer deposits.
Furthermore, recent disruptions to the banking system and the surrounding speculation and uncertainty related to liquidity, solvency and capitalization of other industry players may negatively impact the industry’s reputation and lead to a level of distrust towards banks, especially in relation to new entrants or smaller scale players like us, which could adversely affect our banking business’ ability to access additional funds and attract more customer deposits.
Adverse consequences for the failure to do so may include unanticipated system disruptions, security breaches, computer virus attacks, slower response times, impaired quality of experiences for our users and delays in reporting accurate operating and financial information. 31 Table of Contents The internet infrastructure in some of the markets where we operate may not support the demands associated with continued growth in internet usage.
Adverse consequences for the failure to do so may include unanticipated system disruptions, security breaches, computer virus attacks, slower response times, impaired quality of experiences for our users and delays in reporting accurate operating and financial information. The internet infrastructure in some of the markets where we operate may not support the demands associated with continued growth in internet usage.
Competitors in the banking space such as banks and larger financial institutions may be able to offer more extensive or enhanced products and services, or offer such products and services at more attractive rates, credit or other terms, including more attractive rates on deposits and rates on loans.
Competitors in the banking space such as traditional banks and larger financial institutions may be able to offer more extensive or enhanced products and services, or offer such products and services at more attractive rates, credit or other better terms, including more attractive rates on deposits and rates on loans.
Shopee as the marketplace operator could potentially be required to report transactions made by sellers and other service providers through the platform to the tax authorities in the future and may also be subject to additional tax or withholding obligations.
For example, Shopee as the marketplace operator could potentially be required to report transactions made by sellers and other service providers through the platform to the tax authorities in the future and may also be subject to additional tax or withholding obligations.
Local courts may have broad discretion to reject enforcement of foreign court decisions or arbitration awards. These uncertainties may affect our judgment on the relevance of legal requirements and our ability to enforce our contractual rights or claims.
In addition, local courts may have broad discretion to reject enforcement of foreign court decisions or arbitration awards. These uncertainties may affect our judgment on the relevance of legal requirements and our ability to enforce our contractual rights or claims.
It is unclear if extradition treaties now in effect between the United States and some of our markets would permit effective enforcement of criminal or other penalties, including those under U.S. federal securities laws. The ability of our subsidiaries to distribute dividends to us may be subject to restrictions under the laws of their respective jurisdictions.
It is unclear if extradition treaties now in effect between the United States and some of our markets would permit effective enforcement of criminal or other penalties, including those under U.S. federal securities laws. 43 Table of Contents The ability of our subsidiaries to distribute dividends to us may be subject to restrictions under the laws of their respective jurisdictions.
Commission fee rates and premiums can change based on the prevailing economic, regulatory, taxation and competitive factors as well as consumer demand and the growing availability of alternative methods for clients to meet their risk-protection needs.
Fee rates can change based on the prevailing economic, regulatory, taxation and competitive factors as well as consumer demand and the growing availability of alternative methods for clients to meet their risk-protection needs.
We may not have the resources, technical sophistication, or ability to anticipate or prevent rapidly evolving or sophisticated types of cyberattacks or other types of security breaches. 22 Table of Contents In addition, our confidential or proprietary information or our users’ personal data or payment information may, in some instances, be stored or processed by certain third-party partners, which poses similar risks.
We may not have the resources, technical sophistication, or ability to anticipate or prevent rapidly evolving or sophisticated types of cyberattacks or other types of security breaches. In addition, our confidential or proprietary information or our users’ personal data or payment information may, in some instances, be stored or processed by certain third-party partners, which poses similar risks.
If local or national authorities reach a different conclusion, they would have broad discretion including imposing penalties, and the business operations of such entity could be disrupted, and our reputation may be damaged. MARKETS RELATED RISKS Our businesses and operations in Taiwan may be materially and adversely impacted if we are deemed to be a PRC investor.
If local or national authorities reach a different conclusion, they would have broad discretion including imposing penalties, and the business operations of such entity could be disrupted, and our reputation may be damaged. 40 Table of Contents MARKETS RELATED RISKS Our businesses and operations in Taiwan may be materially and adversely impacted if we are deemed to be a PRC investor.
As a result, our expenses associated with share-based compensation may remain significant or increase, which may have an adverse effect on our results of operations. Because we do not expect to pay dividends in the foreseeable future, holders of ADSs must rely on price appreciation of our ADSs for return on their investment.
As a result, our expenses associated with share-based compensation may remain significant or increase, which may have an adverse effect on our results of operations. 46 Table of Contents Because we do not expect to pay dividends in the foreseeable future, holders of ADSs must rely on price appreciation of our ADSs for return on their investment.
We may also make changes to or expand our product offerings or services in a manner that subjects our businesses to additional legislation, regulations or other compliance obligations, which may result in similar burdens and risks to our businesses.
We may also make changes to or expand our product offerings or services in a manner that subjects our businesses to additional legislation, regulations or other compliance obligations, which may result in similar burdens and risks to our businesses. We face competition in our businesses.
See “Item 10. Additional Information—E. Taxation—Singapore Taxation—Income Tax—Gains With Respect to Disposition of Our ADSs or Our Ordinary Shares.” 40 Table of Contents It will be difficult to acquire jurisdiction and enforce liabilities against our assets based in some of our markets. Substantially all of our assets are located outside the United States.
See “Item 10. Additional Information—E. Taxation—Singapore Taxation—Income Tax—Gains With Respect to Disposition of Our ADSs or Our Ordinary Shares.” It will be difficult to acquire jurisdiction and enforce liabilities against our assets based in some of our markets. Substantially all of our assets are located outside the United States.
A significant amount of our revenue and some of our operating metrics are denominated in certain local currencies that have been subject to significant volatility in the past. Because fluctuations in the value of these local currencies are not necessarily correlated, our results of operations in any period may be adversely affected by such volatility. See “Item 5.
Additionally, a significant amount of our revenue and some of our operating metrics are denominated in certain local currencies that have been subject to significant volatility in the past. Because fluctuations in the value of these local currencies are not necessarily correlated, our results of operations in any period may be adversely affected by such volatility. See “Item 3.
Even if there is adequate acceptance of our digital financial services and products, we continue to be subject to a quickly changing regulatory environment for such services and to the changing needs and demands of users, which may change for a multitude of reasons such as availability of alternative payment methods that are more popular or widely accepted.
Even if there is adequate acceptance of our digital financial services and products, we continue to be subject to the changing needs and demands of users, which may change for a multitude of reasons such as availability of alternative payment methods that are more popular or widely accepted.
Any uninsured liabilities, damage or losses could require us to incur substantial costs and divert our resources, which could have an adverse effect on our business, financial condition and results of operations. 34 Table of Contents Industry data, projections and estimates contained in this annual report are inherently uncertain and subject to interpretation.
Any uninsured liabilities, damage or losses could require us to incur substantial costs and divert our resources, which could have an adverse effect on our business, financial condition and results of operations. Industry data, projections and estimates contained in this annual report are inherently uncertain and subject to interpretation.
For example, in Vietnam, online game publishers are required to obtain certain licenses, approval on game content, certificate and/or acknowledgement of announcement from the competent authority, depending on the classification of each game to be provided to the market. In Thailand, applications to publish online games need to be reviewed and approved by the Thailand Film and Video Censorship Committee.
For example, in Vietnam, online game publishers are required to obtain certain licenses, permit, certificate and/or acknowledgement of announcement from the competent authority, depending on the classification of each game to be provided to the market. In Thailand, applications to publish online games need to be reviewed and approved by the Thailand Film and Video Censorship Committee.
Such restrictions may alter the way in which we do business, increase our costs or liabilities or reduce demand for our platforms, which could adversely affect our business, financial condition and results of operations. From time to time, we have received inquiries from or are subject to inquiries and investigations by competition authorities.
Such restrictions and changes may alter the way in which we do business, increase our costs or liabilities, reduce demand for our platforms or subject us to uncertainties, which could adversely affect our business, financial condition and results of operations. From time to time, we have received inquiries from or are subject to inquiries and investigations by competition authorities.
Additionally, ineffective internal control over financial reporting could expose us to increased risk of fraud or misuse of corporate assets and subject us to potential delisting from the New York Stock Exchange, regulatory investigations and civil or criminal sanctions. 35 Table of Contents We may be subject to risks related to litigation and regulatory proceedings.
Additionally, ineffective internal control over financial reporting could expose us to increased risk of fraud or misuse of corporate assets and subject us to potential delisting from the New York Stock Exchange, regulatory investigations and civil or criminal sanctions. We may be subject to risks related to litigation and regulatory proceedings.
If we fail to comply with new laws, regulations or guidelines, or our strategies to develop and grow our banking business, including products and services, fail to achieve their intended effect, our business, financial condition and results of operations, as well as our reputation, could be materially and adversely affected. We face risks related to our insurance business.
If we fail to comply with laws, regulations or guidelines, or our strategies to develop and grow our banking business, including products and services, fail to achieve their intended effect, our business, financial condition and results of operations, as well as our reputation, could be materially and adversely affected. We face risks relating to our insurance business.
As the gross margin of self-developed game content tends to be higher than that of content licensed from third parties, any fluctuations in the mix of our revenue generated from self-developed game content and licensed game content may also affect our profitability. We have a limited track record in game development and global game distribution.
As the gross margin of self-developed game content tends to be higher than that of content licensed from third parties, any fluctuations in the mix of our revenue generated from self-developed game content and licensed game content may also affect our profitability. 32 Table of Contents We have a limited track record in game development and global game distribution.
If any such action is taken, our operations in Taiwan and our business, financial condition and results of operations may be materially and adversely affected. Uncertainties with respect to the legal system in certain of our markets could adversely affect us. The legal systems in many of our markets vary significantly from jurisdiction to jurisdiction.
If any such action is taken, our operations in Taiwan and our business, financial condition and results of operations may be materially and adversely affected. 41 Table of Contents Uncertainties with respect to the legal system in certain of our markets could adversely affect us. The legal systems in many of our markets vary significantly from jurisdiction to jurisdiction.
Negative market conditions may impair our ability to underwrite insurance at rates we consider appropriate and commensurate relative to the risk assumed. Adverse market conditions could result in a decline in policies sold, an increase in the frequency of claims and premium defaults, and an uptick in the frequency of falsification of claims.
For our insurance underwriting business, negative market conditions may impair our ability to underwrite insurance at rates we consider appropriate and commensurate relative to the risk assumed. Adverse market conditions could result in a decline in policies sold, an increase in the frequency of claims and premium defaults, and an uptick in the frequency of falsification of claims.
Holders of ADSs may not realize a return on their investment in our ADSs and may even lose their entire investment in our ADSs. 44 Table of Contents Our memorandum and articles of association contain anti-takeover provisions and a dual-class voting structure that could have a material adverse effect on the rights of holders of our Class A ordinary shares and our ADSs.
Holders of ADSs may not realize a return on their investment in our ADSs and may even lose their entire investment in our ADSs. Our memorandum and articles of association contain anti-takeover provisions and a dual-class voting structure that could have a material adverse effect on the rights of holders of our Class A ordinary shares and our ADSs.
It is possible that geopolitical, macro-economic and social instability globally and in our markets may negatively impact economic growth, decrease consumer spending, cause uncertainty and volatility in the financial markets, disrupt supply chains globally and in our markets, and may accordingly affect our business, financial condition and results of operations.
It is possible that geopolitical, macro-economic and social instability globally and in our markets may negatively impact economic growth and world trade, decrease consumer spending, cause uncertainty and volatility in the financial markets, disrupt supply chains globally and in our markets, and may accordingly adversely affect our business, financial condition and results of operations.
Our businesses are subject to an increasingly complex and at times divergent data privacy, data protection, data use, data governance, artificial intelligence and information security laws and requirements in the markets in which we operate and where our users, merchant partners, customers and other participants are located.
Our businesses are subject to an increasingly complex and at times divergent data privacy, data protection, data use, data governance, AI and information security laws and requirements in the markets in which we operate and where our users, merchant partners, customers and other participants are located.
The holders of our 2024, 2025 and 2026 convertible notes may convert their convertible notes in accordance with the instruments governing such convertible notes at the initial conversion rate of 19.9475 ADSs, 11.0549 ADSs and 2.0964 ADSs per US$1,000 principal amount, respectively.
The holders of our 2025 and 2026 convertible notes may convert their convertible notes in accordance with the instruments governing such convertible notes at the initial conversion rate of 11.0549 ADSs and 2.0964 ADSs per US$1,000 principal amount, respectively.
Because of these contractual arrangements, we have control over and are the primary beneficiary of such VIEs and hence consolidate their financial results under U.S. GAAP. For the year ended December 31, 2023, revenue from all our VIEs (which excludes entities for which we have majority direct equity ownership) accounted for less than 5% of our total revenue .
Because of these contractual arrangements, we have control over and are the primary beneficiary of such VIEs and hence consolidate their financial results under U.S. GAAP. For the year ended December 31, 2024, revenue from all our VIEs (which excludes entities for which we have majority direct equity ownership) accounted for less than 3% of our total revenue .
See “– We face risks related to logistics and fulfillment.” 32 Table of Contents In addition, in order to optimize our operating efficiency, we have made adjustments to a number of teams across various markets and may in the future implement other such adjustments.
See “—We face risks related to logistics and fulfillment.” In addition, in order to optimize our operating efficiency, we have made adjustments to a number of teams across various markets and may in the future implement other such adjustments.
Any failure to raise needed funds on terms favorable to us, or at all, could severely restrict our liquidity as well as have a material adverse effect on our business, financial condition and results of operations. Moreover, any issuance of equity or equity-linked securities could result in significant dilution to our existing shareholders.
Any failure to raise needed funds on terms favorable to us, or at all, could severely restrict our liquidity as well as have a material adverse effect on our business, financial condition and results of operations. Moreover, any issuance of equity or equity-linked securities could result in significant dilution to our existing shareholders. We have limited insurance coverage.
However, should the Taiwan authorities deem us to be a PRC investor, the Taiwan authorities may take a range of actions, including: • imposing fines between NT$120,000 (US$3,919) to NT$25,000,000 (US$816,460) and further fines if the non-compliance is not rectified as ordered; • ordering us to reduce any direct or indirect ownership or control by PRC investors in our company; • requesting us to divest some or all of our ownership or control in our operating entities in Taiwan; • suspending the rights of shareholders of our Taiwan operating entities; and • discontinuing the operations and revoking the business licenses of our Taiwan operating entities.
However, should the Taiwan authorities deem us to be a PRC investor, the Taiwan authorities may take a range of actions, including: • imposing fines between NT$120,000 (US$3,660) to NT$25,000,000 (US$762,428) and further fines if the non-compliance is not rectified as ordered; • ordering us to reduce any direct or indirect ownership or control by PRC investors in our company; • requesting us to divest some or all of our ownership or control in our operating entities in Taiwan; • suspending the rights of shareholders of our Taiwan operating entities; and • discontinuing the operations and revoking the business licenses of our Taiwan operating entities.
These and other instabilities and any adverse changes in the political environment could increase our costs, increase our exposure to legal and business risks, disrupt our office operations or the business activities of our ecosystem participants, or affect our ability to expand or retain our user base.
These and other instabilities and any adverse changes could increase our costs, increase our exposure to legal and business risks, disrupt our office operations or the business activities of our ecosystem participants, or affect our ability to expand or retain our user base.
In the event of such restrictions, we may face additional legal and regulatory compliance costs and risks, lose investments we have made and/or exit such markets, our users may develop a negative perception of us, and our business, financial condition and results of operations could be negatively affected.
In the event of such restrictions, we may face additional legal and regulatory compliance costs and risks, lose investments we have made and/or exit such markets, our users may develop a negative perception of us, and our business, financial condition and results of operations could be negatively affected. Our results of operations are subject to fluctuations.
These factors include: • the growth rate of internet, broadband, personal computer and smartphone penetration and usage in our markets, including any changes or fluctuations in growth rates and/or usage; • the trust and confidence level of e-commerce consumers, as well as changes in customer demographics and consumer tastes and preferences; • the selection, pricing and popularity of products that online sellers offer; • attracting and retaining a wide range of merchants, brands and retailers; • providing effective technologies, infrastructure and services that meet the evolving needs of consumers and merchants; • economic landscape, macro-economics, and consumer discretionary spending; • competition from online and offline players, such as alternative retail channels or business models that better address the needs or preferences of consumers, including social commerce or multi-category service e-commerce platforms; • the differing and quickly changing laws and regulations applicable to e-commerce businesses in our markets, including any required licenses or permits, exposure to additional liability, including for conduct by or content originating from third parties, and new labor legislation or changes to any employment or independent contractor classification frameworks; and • the development of logistics (especially last-mile delivery and warehousing infrastructure), payment and other ancillary services associated with e-commerce. 24 Table of Contents Our e-commerce revenue is currently concentrated, with our top three markets accounting for approximately half of our total e-commerce revenue.
These factors include: • the growth rate of internet, broadband, personal computer and smartphone penetration and usage in our markets, including any changes or fluctuations in growth rates and/or usage; • the trust and confidence level of e-commerce consumers, as well as changes in customer demographics and consumer tastes and preferences; • the selection, pricing and popularity of products that online sellers offer; • attracting and retaining a wide range of merchants, brands and retailers; • providing effective technologies, infrastructure and services that meet the evolving needs of consumers and merchants; • economic landscape, macro-economics, and consumer discretionary spending; • competition from online and offline players, such as alternative retail channels or business models that better address the needs or preferences of consumers, including social commerce or multi-category service e-commerce platforms; • the differing and quickly changing laws and regulations applicable to e-commerce businesses in our markets, including any required licenses or permits, exposure to additional liability, including for conduct by or content originating from third parties, and new labor legislation or changes to any employment or independent contractor classification frameworks; and • the development of logistics (especially last-mile delivery and warehousing infrastructure), payment and other ancillary services associated with e-commerce.
In addition, in some jurisdictions where we operate, tax laws and regulations or their application to our business may involve uncertainty, and the interpretation of such laws and regulations by the relevant revenue or enforcement authorities may differ from our own or be unpredictable or the subject of disputes or controversy.
In addition, in some jurisdictions where we operate, tax laws and regulations or their application to our business may involve uncertainty, or have uncertain application to novel business arrangements, and the interpretation of such laws and regulations by the relevant revenue or enforcement authorities may differ from our own or be unpredictable or the subject of disputes or controversy.
Taxation—United States Federal Income Tax Considerations—Passive Foreign Investment Company Rules.” Based on our income and assets, and the value of the ADSs, we do not believe that we were a PFIC, for U.S. federal income tax purposes, for the taxable year ended December 31, 2023, and do not anticipate becoming a PFIC for the current taxable year or for the foreseeable future.
Taxation—United States Federal Income Tax Considerations—Passive Foreign Investment Company Rules.” 49 Table of Contents Based on our income and assets, and the value of the ADSs, we do not believe that we were a PFIC, for U.S. federal income tax purposes, for the taxable year ended December 31, 2024, and do not anticipate becoming a PFIC for the current taxable year or for the foreseeable future.
GAAP. 37 Table of Contents The shareholders of our VIEs are our local employees or other local citizens. None of these shareholders has a significant equity interest in our company and thus their interests may not be aligned with ours, or they may have other potential conflicts of interest with us.
The shareholders of our VIEs are our local employees or other local citizens. None of these shareholders has a significant equity interest in our company and thus their interests may not be aligned with ours, or they may have other potential conflicts of interest with us.
See “—Business and Operational Related Risks—Risks Applicable Across Multiple Businesses—We may not succeed in managing or expanding our business across the expansive and diverse markets in which we operate.” Our historical results may not be indicative of our future performance and you should consider our future prospects in light of the risks and uncertainties we face operating in evolving industries in many emerging markets.
See “—We may not succeed in managing or expanding our business across the expansive and diverse markets in which we operate.” Our historical results may not be indicative of our future performance and you should consider our future prospects in light of the risks and uncertainties we face operating in evolving industries in many emerging markets.
We may be unable to achieve the required level of market acceptance in order for us to recoup the investment costs involved in developing and launching our digital financial services and products or to bear the associated risks involved in providing such services and products.
We may be unable to achieve the required level of market acceptance in order for us to recoup our investment costs or to bear the associated risks involved in providing such services and products.
The monetary, commercial, customs or equivalent authorities in the markets in which we operate could impose new or additional licensing requirements, capital commitments, governance standards, reporting obligations or other regulatory requirements, requiring us to devote substantial operational and financial resources to comply with such requirements. We may fail to compete effectively.
The monetary, commercial, or equivalent authorities in the markets in which we operate could impose new or additional licensing requirements, capital commitments, governance standards, reporting obligations or other regulatory requirements, requiring us to devote substantial operational and financial resources to comply with such requirements.
In addition to other relevant risk factors described herein, our own mobile wallet business is subject to other risks including: (i) changes to rules or practices applicable to payment systems that link to our mobile wallet, (ii) increasing operating costs, including fees charged by banks to process transactions through our mobile wallet and fees charged by payment card schemes to link or our mobile wallet, and higher costs from obligations to implement enhanced authentication processes, and (iii) failure to manage user funds accurately or loss of user funds, whether due to employee fraud, security breaches, technical errors or otherwise.
Our own mobile wallet business is subject to other risks including: (i) changes to rules or practices applicable to payment systems that link to our mobile wallet, (ii) increasing operating costs, including fees charged by banks to process transactions through our mobile wallet and fees charged by payment card schemes to link to our mobile wallet, and higher costs from obligations to implement enhanced authentication processes, security or anti-fraud and (iii) failure to manage user funds accurately or loss of user funds, whether due to employee fraud, security breaches, technical errors or otherwise.
Organizational Structure—Thailand Shareholding Structure.” As Thai laws only consider the immediate level of shareholding, no cumulative or look-through calculation is applied to determine the foreign ownership status of a company when it has several levels of foreign shareholding. Such shareholding structure has allowed us to consolidate our Thai operating entities as our subsidiaries.
See “Item 4. Information on the Company—C. Organizational Structure—Thailand Shareholding Structure.” As Thai laws only consider the immediate level of shareholding, no cumulative or look-through calculation is applied to determine the foreign ownership status of a company when it has several levels of foreign shareholding. Such shareholding structure has allowed us to consolidate our Thai operating entities as our subsidiaries.
Any of the foregoing could negatively affect our business, financial condition and results of operations. 14 Table of Contents As the consumer internet business may be relatively new in certain markets, the relevant regulations are evolving and expanding. We may be regularly subject to formal and informal reviews, inquiries and investigations by governments and regulatory authorities.
Any of the foregoing could negatively affect our business, financial condition and results of operations. As the consumer internet business may be relatively new in certain markets, the relevant regulations are evolving and expanding. From time to time, we are subject to formal and informal reviews, inquiries and investigations by governments and regulatory authorities.
As a result of our grants of awards under the 2009 Plan, we incurred share-based compensation expense of US$470.3 million, US$705.9 million and US$685.0 million in 2021, 2022 and 2023, respectively. For more information on our share incentive plan, see “Item 6. Directors, Senior Management and Employees—B.
As a result of our grants of awards under the 2009 Plan, we incurred share-based compensation expense of US$705.9 million, US$685.0 million and US$715.8 million in 2022, 2023 and 2024, respectively. For more information on our share incentive plan, see “Item 6. Directors, Senior Management and Employees—B.
The provision of financial services such as mobile wallet services, payment processing, cross-border e-commerce transactions, consumer and SME credit products, banking and insurtech services are typically more regulated and subject to a broad range of complex laws and regulations that are rapidly changing.
The provision of financial services such as mobile wallet services, payment processing, consumer and SME credit products, banking and insurtech services are typically more regulated and subject to a broad range of complex laws and regulations that are rapidly changing.
In addition, we may fail to obtain any required approvals and licenses from relevant government authorities. We may become subject to new governmental regulations in connection with our investments and acquisitions, which could result in increased costs and new strategic risks. Any of these risks may materially and adversely affect our business, financial condition and results of operations.
These factors could adversely affect our financial results. In addition, we may fail to obtain any required approvals and licenses from relevant government authorities. We may become subject to new governmental regulations in connection with our investments and acquisitions, which could result in increased costs and new strategic risks.
We may also be forced to stop distributing, cease using or redesign the relevant content or product, obtain a license from the claimant, which, if available at all, may not be available on commercially favorable terms.
We may also be forced to stop distributing, cease using or redesign the relevant content or product, obtain a license from the claimant, which, if available at all, may not be available on commercially favorable terms. Existing or future investments or acquisitions may not be successful.
Our games are subject to scrutiny regarding the appropriateness of their content. Our games are subject to reviews, ratings, age restrictions or other restrictions for example on processing of data of minors or on content, advertisement or distribution mandated by laws in some of our markets or ratings by third-party application distribution channels.
Our games are subject to reviews, ratings, age restrictions or other restrictions for example on processing of data of minors or on content, advertisement or distribution mandated by laws in some of our markets or ratings by third-party application distribution channels.
Some local governments also exercise significant control over the economic growth, foreign capital investments, tax regulations and public order in their respective jurisdictions through allocating resources, controlling payment of foreign currency-denominated obligations, setting monetary policies, and providing preferential treatment to particular industries or companies.
Some local governments also exercise significant control over the economic growth, foreign capital investments, tax, export and import duties, quotas, custom duties, tariffs and related regulations and the public order in their respective jurisdictions through allocating resources, controlling payment of foreign currency-denominated obligations, setting monetary policies, and providing preferential treatment to particular industries or companies.
Our businesses and our directors and officers may be, and in some instances are or have been, subject to claims, lawsuits (including class actions and individual lawsuits), regulatory and government investigations, and other proceedings relating to alleged infringement or violation of third-party intellectual property rights, consumer protection, privacy and data protection, content restrictions, labor and employment, import and export practices, antitrust or competition, securities, tax, marketing and communications practices, contracts, commercial disputes, consumer complaints, and various other matters.
Our businesses and our directors and officers may be, and in some instances are or have been, subject to claims, lawsuits (including class actions and individual lawsuits), regulatory and government investigations, and other proceedings relating to alleged infringement or violation of third-party intellectual property rights, consumer protection, privacy and data protection, content restrictions, labor and employment (including workforce classification), import and export practices, antitrust or competition, securities, tax, marketing and communications practices, contracts, commercial disputes, consumer complaints, products and services offered by us and third parties (including AI-related products and services) and various other matters.
Substantial future sales or perceived potential sales or issuances of our ADSs, Class A ordinary shares or other equity securities could cause the price of our ADSs to decline significantly. As of March 31, 2024, the aggregate principal amount outstanding of our 2024, 2025 and 2026 convertible notes was approximately US$152.0 million, US$1.1 billion and US$1.6 billion, respectively.
Substantial future sales or perceived potential sales or issuances of our ADSs, Class A ordinary shares or other equity securities could cause the price of our ADSs to decline significantly. As of March 31, 2025, the aggregate principal amount outstanding of our 2025 and 2026 convertible notes was approximately US$1.15 billion and US$1.33 billion, respectively.
The current maximum aggregate number of ordinary shares which may be issued pursuant to all awards under the 2009 Plan is 210,888,606. We are authorized to grant options, share appreciation rights, share awards of restricted shares and non-restricted shares, restricted share units and other types of awards the administrator of the 2009 Plan decides.
The current maximum aggregate number of ordinary shares which may be issued pursuant to all awards under the 2009 Plan is 228,561,966. We are authorized to grant options, share appreciation rights, share awards of restricted shares and non-restricted shares, restricted share units and other types of awards the administrator of the 2009 Plan decides.

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Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeThe amendments include but are not limited to widening the definition of “cross-border money transfer service” to include transmission of money between two countries, arranged by a payment service provider in Singapore; and widening the definition of “domestic money transfer service” such that the definition applies except where both the payer and payee of a transaction executed under the service are financial institutions.
Biggest changeIn addition to the above, the Payment Services (Amendment) Act 2021 came into effect on April 4, 2024 and introduced amendments to the Payment Services Act 2019 and its subsidiary legislation, including amendments such as widening the definition of “cross-border money transfer service” to include transmission of money between two countries, arranged by a payment service provider in Singapore even where moneys are not accepted or received in Singapore; widening the definition of “domestic money transfer service” such that the definition applies except where both the payer and payee of a transaction executed under the service are financial institutions; expanding the definition of “digital payment token service” to include the provision of custodial services for digital payment tokens, arranging for the transmission of digital payment tokens between accounts, provision of any service of inducing or attempting to induce any person to enter into or to offer to enter into any agreement for or with a view to buying or selling any digital payment token, and the exchange of digital payment tokens, even where the payment service provider does not come into possession of the moneys or digital payment tokens; and adding MAS powers to impose additional requirements on digital payment token service providers in relation to anti-money laundering and countering the financing of terrorism, user protection and financial stability.
As of the date of this annual report, we have, directly or through partnerships, obtained licenses and governmental approvals necessary to provide payment services in Indonesia, Vietnam, Thailand, the Philippines, Malaysia, Singapore and Brazil and to provide credit services in Indonesia, Thailand, the Philippines and Malaysia.
As of the date of this annual report, we have, directly or through partnerships, obtained licenses and governmental approvals necessary to provide payment services in Indonesia, Vietnam, Thailand, the Philippines, Malaysia, Singapore and Brazil and to provide credit services in Indonesia, Thailand, the Philippines, Malaysia and Brazil.
Risk Factors—Business and Operational Related Risks—Other Operational Risks—We rely on structural arrangements to establish control over certain entities and government authorities may determine that these arrangements do not comply with existing laws and regulations.
Risk Factors—Business and Operational Related Risks—Other Operational Risks—We rely on structural arrangements to establish control over certain entities and government authorities may determine that these arrangements do not comply with existing laws and regulations.
Risk Factors—Business and Operational Related Risks—Other Operational Risks—We rely on structural arrangements to establish control over certain entities and government authorities may determine that these arrangements do not comply with existing laws and regulations.
Risk Factors—Business and Operational Related Risks—Other Operational Risks—We rely on structural arrangements to establish control over certain entities and government authorities may determine that these arrangements do not comply with existing laws and regulations.
Loans provided by offshore lenders to Vietnam entities with a term of (i) more than 12 months, (ii) 12 months or below but extended to more than 12 months and (iii) 12 months or below but with the outstanding principal loan amount and interest remaining outstanding one year from the first disbursement date, unless such principal amount is settled within 30 days, must be registered with the State Bank of Vietnam and must satisfy certain conditions with respect to, among others, the term, type, amount, currency and purpose of the loan.
Loans provided by offshore lenders to Vietnam entities with a term of (i) more than 12 months, (ii) 12 months or below but extended to more than 12 months and (iii) 12 months or below but with the outstanding principal loan amount and interest remaining outstanding one year from the first disbursement date, unless such principal amount is settled within 30 working days, must be registered with the State Bank of Vietnam and must satisfy certain conditions with respect to, among others, the term, type, amount, currency and purpose of the loan.
In order to control the volume of foreign currency in Thailand and promote the stability of the Thai baht, foreign exchange regulations in Thailand state that all foreign exchange transactions, including those involving purchases, sales, exchanges and transfers, shall be conducted through commercial banks and through authorized non-banks, namely authorized money changers, money transfer agents, and companies, that are granted foreign exchange licenses from the Minister of Finance of Thailand.
In order to control the volume of foreign currency in Thailand and promote the stability of the Thai baht, foreign exchange regulations in Thailand state that all foreign exchange transactions, including those involving purchases, sales, exchanges and transfers, shall be conducted through authorized parties, including commercial banks and through authorized non-banks, namely authorized money changers, money transfer agents, and companies, that are granted foreign exchange licenses from the Minister of Finance of Thailand.
Further, UGC platform operators should have a filtering system to remove offensive or defamatory content because there is a presumption that the platform or portal provider must assume responsibility for taking the risk of facilitating a platform. Regulations on Personal Data Protection and Information Security The PDPA regulates the processing of personal data in commercial transactions.
Further, UGC platform operators should have a filtering system to remove offensive or defamatory content because there is a presumption that the platform or portal provider must assume responsibility for taking the risk of facilitating a platform. Regulations on Personal Data Protection and Information Security The Malaysia PDPA regulates the processing of personal data in commercial transactions.
An e-money provider may offer features such as user registration, deposit top-up, payment transaction for purchases and bills payment, while funds transfer and cash withdrawal and any additional features (upon approval from Bank Indonesia) are only available for open loop e-money for registered users and licensed e-money providers.
An e-money provider may offer features such as user registration, top-up, payment transaction for purchases and bills payment, while funds transfer and cash withdrawal and any additional features (upon approval from Bank Indonesia) are only available for open loop e-money for registered users and licensed e-money providers.
The definition of “personal data” under the PDPA includes any information in respect of commercial transactions, which relates directly or indirectly to a data subject, who is identified or identifiable from that information or from that and other information in the possession of a data user, including any sensitive personal data and expression of opinion about the data subject.
The definition of “personal data” under the Malaysia PDPA includes any information in respect of commercial transactions, which relates directly or indirectly to a data subject, who is identified or identifiable from that information or from that and other information in the possession of a data user, including any sensitive personal data and expression of opinion about the data subject.
These General Data Protection Regulations set out the rules governing the protection of personal data that are stored in electronic form while PDP Law governs protection of personal data that are stored both in electronic and non-electronic forms.
These General Data Protection Regulations set out the rules governing the protection of personal data that are stored in electronic form while PDP Law governs protection of personal data that are stored in electronic and non-electronic forms.
Accordingly, a company with an application used for sale of goods, which includes an online ordering function must notify the MOIT; a company with an application for the provision of e-commerce services must register with the MOIT.
Accordingly, a company with an application used for sale of goods, which includes an online ordering function must notify the MOIT and a company with an application for the provision of e-commerce services must register with the MOIT.
In December 2017, we launched the first game that we developed entirely in-house, Free Fire, a mobile game of the battle royale genre. Free Fire has enabled us to grow globally beyond Southeast Asia and Taiwan where we initially launched our game business. It is currently available on the Google Play and iOS App Stores in more than 130 markets.
In December 2017, we launched the first game that we developed entirely in-house, Free Fire, a mobile game of the battle royale genre. Free Fire has enabled us to grow globally beyond Southeast Asia and Taiwan where we initially launched our game business. It is currently available on the Google Play and iOS App Stores in more than 160 markets.
The PDP Law requires any action taken in relation to the processing of personal data by either Personal Data Controllers and Personal Data Processors, including acquisition and collection, processing and analysis, storage, correction and updates, display, announcement, transfer, dissemination, disclosure, and deletion or destruction, to be subject to provisions of the PDP Law, such as requiring prior consent of the owner of such personal data.
The PDP Law requires any action taken in relation to the processing of personal data by either Personal Data Controllers and Personal Data Processors (as defined in the regulation), including acquisition and collection, processing and analysis, storage, correction and updates, display, announcement, transfer, dissemination, disclosure, and deletion or destruction, to be subject to provisions of the PDP Law, such as requiring prior consent of the owner of such personal data.
We are also subject to other risks relating to such structural arrangements.” 90 Table of Contents Thailand Shareholding Structure Our operating entities in Thailand are established using a tiered structure that maximizes our equity interests in the entity while also complying with the Thai law requirement that each Thai company has the minimum number of required shareholders and, without approval from Thai authorities, direct foreign ownership of share capital of each entity operating the restricted business under the Thai Foreign Business Act is limited to less than 50%.
We are also subject to other risks relating to such structural arrangements.” Thailand Shareholding Structure Our operating entities in Thailand are established using a tiered structure that maximizes our equity interests in the entity while also complying with the Thai law requirement that each Thai company has the minimum number of required shareholders and, without approval from Thai authorities, direct foreign ownership of share capital of each entity operating the restricted business under the Thai Foreign Business Act is limited to less than 50%.
We believe that strengths across the e-commerce and digital entertainment businesses position us very well to grow our digital financial businesses and SeaMoney has a significant competitive advantage with the strong demand in our markets for seamless and convenient forms of mobile payments as well as the continued development of the digital economy in our markets.
We believe that strengths across the e-commerce and digital entertainment businesses position us very well to grow our digital financial services businesses and SeaMoney has a significant competitive advantage with the strong demand in our markets for seamless and convenient forms of mobile financial services as well as the continued development of the digital economy in our markets.
The PDPA applies insofar as personal data of customer is processed (for example, name, identification card number, address, phone number, email address).
The Malaysia PDPA applies insofar as personal data of customer is processed (for example, name, identification card number, address, phone number, email address).
SeaMoney Digital Financial Services Business SeaMoney, our digital financial services business, is a leading digital financial services provider in Southeast Asia with a growing presence in Brazil. SeaMoney currently offers consumer and SME credit, mobile wallet, banking and insurtech services. SeaMoney’s credit business primarily consists of consumer and SME loans provided predominantly to both Shopee buyers and sellers.
SeaMoney Digital Financial Services Business SeaMoney, our digital financial services business, is a leading digital financial services provider in Southeast Asia with a growing presence in Brazil. SeaMoney currently offers consumer and SME credit, mobile wallet, payment processing, banking, and insurtech services. SeaMoney’s credit business primarily consists of consumer and SME loans provided predominantly to both Shopee buyers and sellers.
SeaMoney currently offers consumer and SME credit, mobile wallet, banking and insurtech services. • Garena is a global game developer and publisher . Garena provides users with access to popular and engaging mobile and PC online games that we develop, curate, license and localize for each market.
SeaMoney currently offers consumer and SME credit, mobile wallet, payment processing, banking, and insurtech services. • Garena is a global game developer and publisher . Garena provides users with access to popular and engaging mobile and PC online games that we develop, curate, license and localize for each market.
OJK Regulation 22 also requires financial service institutions to, among others, have and implement consumer protection policies and procedures, have a consumer protection unit or function, and report the implementation of consumer protection to the OJK. Violations of this regulation may result in administrative sanctions, ranging from written warnings to revocation of license.
OJK Regulation 22 also requires financial service institutions to implement consumer protection policies and procedures, have a consumer protection unit or function, and report the implementation of consumer protection to the OJK. Violations of this regulation may result in administrative sanctions, ranging from written warnings to revocation of license.
Regulation 31 introduced (a) new restrictions on interconnection between electronic systems used for e-commerce and those not used for e-commerce, (b) platform providers are now required to provide equal business opportunities to all merchants and maintain the prices of goods and/or services and ensure they are free from any direct or indirect price manipulations, to supervise, prevent and mitigate any unfair business and/or price manipulation practices through the establishment of adequate standard operating procedures, and (c) platform providers that engage in cross-border marketplace activities are required to apply minimum prices for merchants that sell imported finished goods within their system.
Regulation 31 (a) introduced new restrictions on interconnection between electronic systems used for e-commerce and those not used for e-commerce, (b) required platform providers to provide equal business opportunities to all merchants and maintain the prices of goods and/or services and ensure they are free from price manipulations, and to supervise, prevent and mitigate any unfair business practices through the establishment of adequate standard operating procedures, and (c) required platform providers that engage in cross-border marketplace activities to apply minimum prices for merchants that sell imported finished goods within their system.
Payments between persons in Malaysia should be in ringgit, unless foreign currency is permitted under the foreign exchange policy (the “FEP”). The BNM, has a policy against the internationalization of ringgit, therefore ringgit exchange rates must be determined onshore in Malaysia, and there are restrictions on the outflow of ringgit under the FEP.
Payments between persons in Malaysia shall be in ringgit, unless foreign currency is permitted under the foreign exchange policy (the “FEP”). BNM has a policy against the internationalization of ringgit, therefore ringgit exchange rates must be determined onshore in Malaysia, and there are restrictions on the outflow of ringgit under the FEP.
We plan to continue to expand our game development capabilities and publishing business. 53 Table of Contents Game Players We have a large and active user base for our online game business. The table below sets forth certain of our operating metrics for the periods indicated.
We plan to continue to expand our game development capabilities and publishing business. Game Players We have a large and active user base for our online game business. The table below sets forth certain of our operating metrics for the periods indicated.
As we expand our digital financial services business to additional markets, we may need to obtain additional licenses and permits in order to comply with local laws. See “—Regulation” and “Item 3. Key Information—D.
Business Overview—Regulation.” As we expand our digital financial services business to additional markets, we may need to obtain additional licenses and permits in order to comply with local laws. See “—Regulation”, “Item 3. Key Information—D.
We also promote esports in our markets to strengthen our game ecosystem and increase user engagement. Each of our businesses provides a distinct and compelling value proposition to our users, and each exhibits strong virtuous cycle dynamics, which we believe support our leadership position and provide a strong foundation for continued growth while creating strong competitive moats.
We also promote esports in our markets to strengthen our game ecosystem and increase user engagement. 51 Table of Contents Each of our businesses provides a distinct and compelling value proposition to our users, and each exhibits strong virtuous cycle dynamics, which we believe support our leadership position and provide a strong foundation for continued growth while creating strong competitive moats.
Key Information—D. Risk Factors—Business and Operational Related Risks—Risks Applicable Across Multiple Businesses—We may be subject to intellectual property-related risks.” Also, we cannot be certain that our intellectual property and/or the products and content on our platforms do not or will not infringe on the valid patents, copyrights or other intellectual property rights held by third parties.
Risk Factors—Business and Operational Related Risks—Risks Applicable Across Multiple Businesses—We may be subject to intellectual property-related risks.” Also, we cannot be certain that our intellectual property and/or the products and content on our platforms do not or will not infringe on the valid patents, copyrights or other intellectual property rights held by third parties.
Failure to submit the report may subject the reporting party to administrative sanction(s) including warning letters, public announcements on the action or an administrative penalty. 63 Table of Contents Prevention and Eradication of Terrorism Financing Law No. 9 of 2013 on the Prevention and Eradication of Terrorism Financing was enacted in order to prevent the funding of terrorists.
Failure to submit the report may subject the reporting party to administrative sanction(s) including warning letters, public announcements on the action or an administrative penalty. Prevention and Eradication of Terrorism Financing Law No. 9 of 2013 on the Prevention and Eradication of Terrorism Financing was enacted in order to prevent the funding of terrorists.
Aside from minimum benefits under the EA, both employees and employers in Malaysia are required to contribute towards: the Employees Provident Fund, the Employment Insurance System as well as the Employees Social Security Fund.
Aside from minimum benefits under the act, both employees and employers in Malaysia are required to contribute towards: the Employees Provident Fund, the Employment Insurance System as well as the Employees Social Security Fund.
A company looking to distribute dividends is required to set aside at least 5% of its retained earnings into a legal reserve fund at the time the dividend is paid until and unless the legal reserve fund reaches 10% of the company’s registered capital. 72 Table of Contents The dividend distributed to a company’s shareholders is subject to a 10% withholding tax.
A company looking to distribute dividends is required to set aside at least 5% of its retained earnings into a legal reserve fund at the time the dividend is paid until and unless the legal reserve fund reaches 10% of the company’s registered capital. The dividend distributed to a company’s shareholders is subject to a 10% withholding tax.
In addition, on January 18, 2021, the Bank of Thailand issued the Notification of the Bank of Thailand No. SorNorChor 1/2564 (2021) Regarding the Guideline on Supervision of Information Technology Risk in accordance with the Laws on Payment System requiring the designated payment services providers to arrange appropriate IT governance, IT security controls, and IT risk management.
In addition, the Bank of Thailand has issued the Notification of the Bank of Thailand No. SorNorChor 1/2564 (2021) Regarding the Guideline on Supervision of Information Technology Risk in accordance with the Laws on Payment System requiring the designated payment services providers to arrange appropriate IT governance, IT security controls, and IT risk management.
Regulations on Data Protection and Information Security Personal Data Protection The Personal Data Protection Act 2012 of Singapore governs the collection, use and disclosure of the personal data of individuals by organizations, and is administered and enforced by the regulator, the Personal Data Protection Commission.
Regulations on Data Protection and Information Security Personal Data Protection The Personal Data Protection Act 2012 of Singapore (“PDPA”) governs the collection, use and disclosure of the personal data of individuals by organizations, and is administered and enforced by the regulator, the Personal Data Protection Commission (“PDPC”).
We will continue to closely monitor regulatory developments in order to continue to comply with the anti-money laundering and prevention of terrorism financing regulations. 67 Table of Contents Regulations on Labor According to the Labor Standards Act of Taiwan, employers are not allowed to terminate employment contracts without cause.
We will continue to closely monitor regulatory developments in order to continue to comply with the anti-money laundering and prevention of terrorism financing regulations. Regulations on Labor According to the Labor Standards Act of Taiwan, employers are not allowed to terminate employment contracts without cause.
Pursuant to the Direct Sale and Direct Marketing Act B.E. 2545 (2002), (as amended, the “Direct Sale and Direct Marketing Act”), companies engaging in direct sales or direct marketing are required to register their business with the Secretariat General of the Office of Consumer Protection or the officer appointed by the Secretariat General of the Office of Consumer Protection.
Regulations on E-commerce Pursuant to the Direct Sale and Direct Marketing Act B.E. 2545 (2002), (as amended, the “Direct Sale and Direct Marketing Act”), companies engaging in direct sales or direct marketing are required to register their business with the Secretariat General of the Office of Consumer Protection or the officer appointed by the Secretariat General of the Office of Consumer Protection.
Under such notification, nano finance business operators are required to adopt principles in business operation such as to: (i) ensure accurate and clear advertising and provide complete and accurate information to customers; (ii) consider customers’ affordability and repayment ability; and (iii) give advance notifications to debtors.
Under such notification, nano finance business operators are required to adopt eight principles in business operation such as to: (i) ensure accurate and clear advertising and provide complete and accurate information to customers; (ii) consider customers’ affordability and repayment ability; and (iii) give advance notifications to debtors, among others.
A licensee under the Payment Services Act 2019 will also need to comply with the directions and/or regulations issued by the MAS under Section 15 of the Financial Services and Markets Act 2022 in relation to dealing with assets of and/or imposing sanctions on designated persons.
A licensee under the Payment Services Act 2019 will also need to comply with, among other things, the directions and/or regulations issued by the MAS under Section 15 of the Financial Services and Markets Act 2022 in relation to dealing with assets of and/or imposing sanctions on designated persons.
Regulations on Data Protection and Information Security On June 12, 2018, the Vietnam National Assembly issued the Law on Cybersecurity which regulates that any foreign service provider in the fields of e-payment, e-commerce, online games, and certain other industries, is required to have a commercial presence in Vietnam (such as branch, representative office) and to localize the user’s data in Vietnam.
Regulations on Data Protection and Information Security The Vietnam National Assembly issued the Law on Cybersecurity which regulates that any foreign service provider in the fields of e-payment, e-commerce, online games, and certain other industries, is required to have a commercial presence in Vietnam (such as branch or representative office) and to localize the user’s data in Vietnam.
The primary laws and regulations to which we are subject relate to foreign investment, dividend distributions, foreign exchange controls, e-commerce, mobile wallet, payment processing, game operating, data protection, intellectual property rights, anti-money laundering and terrorism financing and employment and labor.
The primary laws and regulations to which we are subject relate to foreign investment, dividend distributions, foreign exchange controls, e-commerce, mobile wallet, payment processing, game operating, data protection, anti-money laundering and terrorism financing and employment and labor.
In case of being deemed non-compliant with the above-mentioned laws and regulations, the Taiwan authorities may take a range of actions, including: • imposing fines between NT$120,000 (US$3,919) to NT$25,000,000 (US$816,460) and further fines if the non-compliance is not rectified as ordered; • ordering the violator to reduce any direct or indirect ownership or control by PRC investors; • requesting the violator to divest some or all of its investment or control in its invested entities in Taiwan; • suspending the rights of shareholders; and • discontinuing the operations and revoking the business licenses of its invested entities in Taiwan.
In case of being deemed non-compliant with the above-mentioned laws and regulations, the Taiwan authorities may take a range of actions, including: • imposing fines between NT$120,000 (US$3,660) to NT$25,000,000 (US$762,428) and further fines if the non-compliance is not rectified as ordered; • ordering the violator to reduce any direct or indirect ownership or control by PRC investors; • requesting the violator to divest some or all of its investment or control in its invested entities in Taiwan; • suspending the rights of shareholders; and • discontinuing the operations and revoking the business licenses of its invested entities in Taiwan.
Risk Factors—Business and Operational Related Risks—Risks Applicable Across Multiple Businesses—Our results of operations are subject to fluctuations.” 56 Table of Contents Regulation This section sets forth a summary of the significant regulations or requirements in the jurisdictions where we conduct our material business operations, namely Indonesia, Taiwan, Vietnam, Thailand, Singapore and Malaysia.
Risk Factors—Business and Operational Related Risks—Risks Applicable Across Multiple Businesses—Our results of operations are subject to fluctuations.” Regulation This section sets forth a summary of the significant regulations or requirements in the jurisdictions where we conduct our material business operations, namely Indonesia, Taiwan, Vietnam, Thailand, Singapore Malaysia and Brazil.
Risk Factors—Business and Operational Related Risks—Risks Applicable Across Multiple Businesses—We may fail to compete effectively.” E-commerce We face competition from regional players that operate across several markets and global players that expand into our markets by building local platforms or making their existing platforms accessible to users in our markets and from single-market players and retailers.
Risk Factors—Business and Operational Related Risks—Risks Applicable Across Multiple Businesses—We face competition in our businesses.” E-commerce We face competition from regional players that operate across several markets and global players that expand into our markets by building local platforms or making their existing platforms accessible to users in our markets and from single-market players and retailers.
Whilst a DFB will eventually be expected to comply with the minimum paid-up capital requirement set by the MAS of S$1.5 billion (US$1.1 billion) which is applicable to all existing qualifying full banks, prior to it becoming a fully functioning DFB, the minimum paid up capital requirement applicable to a restricted DFB will initially be reduced to S$15 million (US$11.4 million).
Whilst a DFB will eventually be expected to comply with the minimum paid-up capital requirement set by the MAS of S$1.5 billion (US$1.1 billion) which is applicable to all existing qualifying full banks, prior to it becoming a fully functioning DFB, the minimum paid up capital requirement applicable to a restricted DFB is S$15 million (US$11.0 million).
For the year ended December 31, 2023, revenue from all our VIEs (which excludes entities for which we have majority direct equity ownership) accounted for less than 5% of our total revenue. None of our VIEs is individually a significant subsidiary as defined in Rule 1-02(w) of Regulation S-X.
For the year ended December 31, 2024, revenue from all our VIEs (which excludes entities for which we have majority direct equity ownership) accounted for less than 3% of our total revenue. None of our VIEs is individually a significant subsidiary as defined in Rule 1-02(w) of Regulation S-X.
We aspire to better every life we touch and make the world an ever more connected community through innovative products and services. • Our institution will outlast us . We strive to build an institution that will last for generations and evolve with time, and that is founded upon our core values.
We aspire to better every life we touch and make the world an ever more connected community through innovative products and services. 50 Table of Contents • Our institution will outlast us . We strive to build an institution that will last for generations and evolve with time, and that is founded upon our core values.
Our data science technology serves various types of data-intensive computational needs, including high-volume batch processing and multi-variable and multi-dimensional real-time analytics. Customer Service We have dedicated customer service teams.
Our data science technology serves various types of data-intensive computational needs, including high-volume batch processing and multi-variable and multi-dimensional real-time analytics. 57 Table of Contents Customer Service We have dedicated customer service teams.
Vietnam Regulations on Foreign Investment Foreign investment into Vietnam is regulated by both domestic legislation and international agreements, with the primary regulations being the Law on Investment and Vietnam’s WTO c ommitments. Foreign investment is generally divided into three categories: unrestricted, restricted, and prohibited.
Vietnam Regulations on Foreign Investment Foreign investment into Vietnam is regulated by both domestic legislation and international agreements, with the primary regulations being the Law on Investment and Vietnam’s WTO commitments. Foreign investment is generally divided into three categories: unrestricted, restricted, and prohibited.
For example, foreign ownership in companies engaging in online game business may not exceed 49% following Vietnam’s WTO commitments, and companies with foreign ownership engaging in e-payment or e-commerce business ha ve to obtain certain government approvals.
For example, foreign ownership in companies engaging in online game business may not exceed 49% following Vietnam’s WTO commitments, and companies with foreign ownership engaging in e-payment or e-commerce business have to obtain certain government approvals.
Under prevailing Indonesian laws and regulations, electronic money or e-money is defined as a payment instrument (i) issued on the basis of the source of funds being denominated in Indonesian rupiah that is deposited in advance to the e-money issuer, (ii) where the source of funds denominated in Indonesian rupiah is stored electronically in a server or a chip for purposes of transferring funds, and (iii) where the value of the e-money managed by the issuer is not considered as savings under the banking regulations.
Under the Payment Service Providers Regulation, electronic money or e-money is defined as a payment instrument (i) issued on the basis of the source of funds being denominated in Indonesian rupiah that is deposited in advance to the e-money issuer, (ii) where the source of funds denominated in Indonesian rupiah is stored electronically in a server or a chip for purposes of transferring funds, and (iii) where the value of the e-money managed by the issuer is not considered as savings under the banking regulations.
Although such approvals have been routinely granted in the past, there can be no assurance that in the future any such approvals will be obtained in a timely manner, or at all. Regulations on Dividend Distributions Dividend distributions by companies incorporated in Taiwan are governed by the Taiwan Company Act.
Although such approvals have been routinely granted in the past, there can be no assurance that in the future any such approvals will be obtained in a timely manner, or at all. 66 Table of Contents Regulations on Dividend Distributions Dividend distributions by companies incorporated in Taiwan are governed by the Taiwan Company Act.
Moreover, the interest rate for personal loans, together with fees and penalties, shall not exceed 25% effective rate per annum. Adhering to the same approach as in nano finance business, the Bank of Thailand’s Notification No. SorNorSor 13/2566 (2023) amended the Notification No.
Moreover, the interest rate for personal loans granted under the personal loan license, together with fees and penalties, shall not exceed 25% effective rate per annum. Adhering to the same approach as in nano finance business, the Bank of Thailand’s Notification No. SorNorSor 13/2566 (2023) amended the Notification No.
Section 211 of the Communications and Multimedia Act 1998 (“CMA”) provides that no content applications service provider, or other person using a content applications service, shall provide content which is indecent, obscene, false, menacing, or offensive in character with intent to annoy, abuse, threaten or harass any person.
Section 211 of the Communications and Multimedia Act 1998 (“CMA”) provides that no content applications service provider shall provide content which is indecent, obscene, false, menacing, or grossly offensive in character with intent to annoy, abuse, threaten or harass any person.
Moreover, such companies may also be dismantled or expropriated by the government. Financial service providers must comply with know-your-customer principles and report suspicious financial transactions that it believes is related to terrorism to the PPATK. Intentionally failing to do so will result in fines of up to IDR1 billion (US$64,771).
Moreover, such companies may also be dismantled or expropriated by the government. Financial service providers must comply with know-your-customer principles and report suspicious financial transactions that it believes is related to terrorism to the PPATK. Intentionally failing to do so may result in fines of up to IDR1 billion (US$61,893).
Once a restricted DFB has met all relevant milestones and has been assessed by the MAS to pose no significant supervisory concerns, the MAS will lift all restrictions and the restricted DFB will become a fully functioning DFB.
Once a restricted DFB has met all relevant milestones and has been assessed by the MAS to pose no significant supervisory concerns, the MAS may lift all restrictions, upon which the restricted DFB will become a fully functioning DFB.
The requirement for BNPL operators to participate in a BNPL credit bureau is also enshrined in the BNPL CoC. All new and existing BNPL operators are expected to comply with the BNPL CoC from November 1, 2023. MAS will monitor the BNPL sector and continue to engage the industry as part of subsequent reviews of the BNPL CoC as necessary.
The requirement for BNPL operators to participate in a BNPL credit bureau is also enshrined in the BNPL CoC. All new and existing BNPL operators are expected to comply with the BNPL CoC. MAS will monitor the BNPL sector and continue to engage the industry as part of subsequent reviews of the BNPL CoC as necessary.
A person on a sanctions list is referred to as a specified entity. Periodic reporting of positive name matches must be made to BNM. Regulations on Labor Employment and industrial relations in Malaysia are mainly governed by the Employment Act 1955 (“EA”).
A person on a sanctions list is referred to as a specified entity or designated person. Periodic reporting of positive name matches must be made to BNM by reporting institutions. Regulations on Labor Employment and industrial relations in Malaysia are mainly governed by the Employment Act 1955.
Since then, we have further expanded our digital financial service offerings across credit, banking and insurtech services in Southeast Asia, and have started to grow our presence in Brazil. 47 Table of Contents We launched our e-commerce business, Shopee, in Southeast Asia and Taiwan in 2015, and in Latin America in 2019.
Since then, we have further expanded our digital financial service offerings across credit, banking and insurtech services in Southeast Asia, and have started to grow our presence in Brazil. We launched our e-commerce business, Shopee, in Southeast Asia and Taiwan in 2015, and in Latin America in 2019.
Third-party merchants currently include telecommunications companies, online and offline entertainment service providers such as game operators or app stores, movie theaters, concert/event venues, utility service providers, food delivery service providers, credit card issuers, banks, insurance companies, and car leasing companies.
Third-party merchants currently include telecommunications companies, online and offline entertainment service providers such as game operators or app stores, movie theaters, concert/event venues, utility service providers, technology companies, food delivery service providers, credit card issuers, banks, fund managers and fund distributors, insurance companies, and car leasing companies.
Moreover, SeaMoney offers other digital financial services to its users through technology, such as banking services in Singapore, Indonesia and the Philippines. We also offer insurance products through our SeaInsure business. SeaInsure acts as an underwriter for selective types of life and non-life insurance products in certain of our markets.
Moreover, SeaMoney offers other digital financial services to its users through technology, such as payment processing in Southeast Asia and Brazil, banking services in Singapore, Indonesia and the Philippines. We also offer insurance products through our SeaInsure business. SeaInsure acts as an underwriter for selective types of life and non-life insurance products in certain of our markets.
We also actively engage in monitoring and enforcement activities with respect to infringing uses of our intellectual property by third parties. 55 Table of Contents While we actively take steps to protect our proprietary rights, such steps may not be adequate to prevent the infringement or misappropriation of the intellectual property created by or licensed to us. See “Item 3.
We also actively engage in monitoring and enforcement activities with respect to infringing uses of our intellectual property by third parties. While we actively take steps to protect our proprietary rights, such steps may not be adequate to prevent the infringement or misappropriation of the intellectual property created by or licensed to us. See “Item 3. Key Information—D.
Each business is localized to meet the unique characteristics of our markets. Many of our markets are experiencing a generational transition to the new digital economy, with digital inclusion bringing consumers ever more closely to each other and online services, by leading internet business models such as our own.
Many of our markets are experiencing a generational transition to the new digital economy, with digital inclusion bringing consumers ever more closely to each other and online services, by leading internet business models such as our own.
On November 25, 2023, the Indonesian Ministry of Trade published Regulation No. 31 of 2023 on the Provisions of Business Licensing, Advertising, Development, and Supervision of Businesses Actors in Trading through Electronic Systems (“Regulation 31”).
The Indonesian Ministry of Trade has also published Regulation No. 31 of 2023 on the Provisions of Business Licensing, Advertising, Development, and Supervision of Businesses Actors in Trading through Electronic Systems (“Regulation 31”).
As a financial services provider, a merchant acquirer may not engage in prohibited business conduct set out in Schedule 7 of the FSA, as supplemented by policy documents of BNM.
As a financial services provider, a merchant acquirer may not engage in prohibited business conduct set out in Schedule 7 of the FSA, as supplemented by policy documents of BNM. We are a registered merchant acquirer in Malaysia.
However, a company which (i) only engages in the business of collecting and making payments for real transactions as an agent; (ii) the total balance of funds it collects/pays and keeps does not exceed NT$2 billion (US$65 million) in the average daily amount of a year; and (iii) does not accept deposits of funds as stored value funds, or transfer funds between e-payment accounts, is not considered an electronic payment institution.
However, a company which (i) only engages in the business of collecting and making payments for real transactions as an agent; (ii) the total balance of funds it collects/pays and keeps does not exceed NT$2 billion (US$61 million) in the average daily amount of a year; and (iii) does not accept deposits of funds as stored value funds, or transfer funds between e-payment accounts, is not considered an electronic payment institution, and will be considered a third-party-payment service provider instead.
SorNorSor 12/2563 (2020), personal loan business operators are now also prohibited from imposing interest, fines, penalties, fees, or any charges when customers redeem or repay the loan before the scheduled due date (prepayment fee), whether in full or in part. Additionally, the Bank of Thailand’s Notification No.
SorNorSor 12/2563 (2020), personal loan business operators are now also prohibited from imposing interest, fines, penalties, fees, or any charges when customers redeem or repay the loan before the scheduled due date (prepayment fee), whether in full or in part.
Property, Plants and Equipment Our headquarters and our principal technical development facilities are located in Singapore, where we have leased approximately 76,600 square meters of office space, as of December 31, 2023. We also have local offices in other parts of Asia and Latin America.
Property, Plants and Equipment Our headquarters and our principal technical development facilities are located in Singapore, where we have leased approximately 72,000 square meters of office space, as of December 31, 2024. We also have local offices in other parts of Asia and Latin America.
Under the Payment Systems Act, an operator seeking to operate a regulated payment system or regulated payment service, which includes e-payment services, is required to have a license before operating such business.
Under the Payment Systems Act, an operator seeking to operate a regulated payment system or regulated payment service, which includes e-payment services, is required to have a license.
However, it should be noted that DFBs are (i) only allowed to operate one physical “place of business” (being a place where a bank conducts banking business or other regulated businesses), (ii) not allowed to access the automatic teller machine or cash deposit machine network, but will be able to offer cashback services through EFTPOS terminals at retail merchants, and (iii) will be required to comply with same risk based capital requirements applicable to domestic systemically important banks. 79 Table of Contents A DFB will commence operations as a restricted DFB before becoming a fully functioning DFB.
However, it should be noted that DFBs are (i) only allowed to operate one physical “place of business” (being a place where a bank conducts banking business or other regulated businesses), (ii) not allowed to access the automatic teller machine or cash deposit machine network, but will be able to offer cashback services through EFTPOS terminals at retail merchants, and (iii) will be required to comply with same risk based capital requirements applicable to domestic systemically important banks.
If the total balance of funds such company collects/pays exceed NT$2 billion (US$65 million) in the average daily amount of a year, or if such company conducts either accepting deposits of funds as stored value funds, or transferring funds between e-payment accounts or by using a stored value card, then such company shall apply for a license to qualify as an electronic payment institution.
If the total balance of funds such company collects/pays exceed NT$2 billion (US$61 million) in the average daily amount of a year, or if such company either accepts deposits of funds as stored value funds, or transfers funds between e-payment accounts or by using a stored value card, such company shall apply for a license to qualify as an electronic payment institution.
Regulations on Anti-money Laundering and Prevention of Terrorism Financing Prevention and Eradication of Money Laundering Law No. 8 of 2010 on Prevention and Eradication of Money Laundering regulates the types of transactions which are required to be reported to the Indonesian Financial Transaction Reports and Analysis Center (“PPATK”), and the entities responsible to report such transactions.
Regulations on Anti-money Laundering and Prevention of Terrorism Financing Prevention and Eradication of Money Laundering Law No. 8 of 2010 on Prevention and Eradication of Money Laundering, as amended, regulates the types of transactions which are required to be reported to the Indonesian Financial Transaction Reports and Analysis Center (“PPATK”).
Regulations on the Use of Indonesian Rupiah On January 12, 2023, the government of Indonesia enacted Law No. 4 of 2023 on Financial Sector Development and Reinforcement, which amends Law No. 7 of 2011 on Currency (the “Indonesia Currency Law”).
Regulations on the Use of Indonesian Rupiah The government of Indonesia has enacted Law No. 4 of 2023 on the Development and Strengthening of the Financial Sector, which amends Law No. 7 of 2011 on Currency (the “Indonesia Currency Law”).
If we fail to employ the abovementioned measures or to act in a timely or effective manner in response to user reports relating to listings or sales of prohibited content on the Shopee e-commerce marketplace, we may be subject to sanctions in the form of, amongst others, a temporary or permanent block.
If we fail to employ the abovementioned measures or to act in a timely or effective manner in response to user reports relating to listings or sales of prohibited content, our services may be subject to sanctions in the form of, amongst others, a temporary or permanent block.
Under this law, any party who conceals or disguises the origin, source, location, allocation, assignment, or actual ownership or assets known or reasonably suspected to be proceeds of crimes may subject to monetary sanction of up to IDR5 billion (US$323,855) or imprisonment of up to 20 years.
Any party who conceals or disguises the origin, source, location, allocation, assignment, or actual ownership or assets known or reasonably suspected to be proceeds of crimes may be subject to monetary sanction of up to IDR5 billion (US$309,463) or imprisonment of up to 20 years.
Nano finance business operators are now prohibited from charging interest, fines, penalties, fees, or any other charges in the case where customer redeem or repay the loan before the scheduled due date (prepayment fee), whether in full or in part. The Bank of Thailand has issued Notification No.
The Bank of Thailand has issued Notification No. SorNorSor 14/2566 (2023), to amend the Notification No. SorNorSor 13/2563 (2020). Nano finance business operators are now prohibited from charging interest, fines, penalties, fees, or any other charges in the case where customer redeem or repay the loan before the scheduled due date (prepayment fee), whether in full or in part.
In addition, according to the Recording of Matters in the Standard Contracts of Online Games, game operating companies need to label the following information on their (a) game websites, log-in page of the game or checkout page; and (b) the packaging of their games: (i) the rating level and the age groups that are prohibited or suitable for the game, (ii) the minimum system requirements for running the game, (iii) payment information for safety systems provided within the online games (if any) and whether such safety systems are free or not, and (iv) information and certain warning language regarding in-game activities, rewards, prizes and winning percentage.
In addition, according to the Recording of Matters in the Standard Contracts of Online Games, game operating companies need to label the following information on their game websites, log-in page of the game or checkout page, and the packaging of their games: (i) the rating level and the age groups that are prohibited or suitable for the game, (ii) the minimum system requirements for running the game, (iii) payment information for safety systems provided within the online games (if any) and whether such safety systems are free or not, and (iv) information and certain warning language regarding in-game activities, rewards, prizes and winning percentage. 67 Table of Contents Regulations on Data Protection and Information Security The main regulation governing the protection of personal data in Taiwan is the Personal Data Protection Act.
Companies that own e-commerce service provision websites, including e-commerce marketplace, online auction websites, and online promotion websites, must register with the MOIT for the establishment of such e-commerce platforms.
Companies that own e-commerce service provision websites, including e-commerce marketplace, online auction websites, and online promotion websites, must register with the MOIT.
Under the Game Classification Regulation, any individual, business entity and/or legal entity that markets gaming products (“Game Publisher”) must conduct an independent classification on the gaming products that it intends to advertise and/or market in Indonesia.
Under the Game Classification Regulation, any individual, business entity and/or legal entity that markets gaming products (“Game Publisher”) must conduct an independent classification on the gaming products that it intends to advertise and/or market in Indonesia, which must then be assessed by a game classification examiner or MCD.
Risk Factors—Business and Operational Related Risks—Risks Related to Our Digital Financial Services Business—Our banking business may subject us to additional material business, operational, financial, legal and compliance requirements and risks.” Garena Digital Entertainment Business Garena, our digital entertainment business, primarily focuses on offering mobile and PC online games and developing mobile games for the global markets.
Risk Factors—Business and Operational Related Risks—Risks Related to Our Digital Financial Services Business—Our banking business may subject us to additional material business, operational, financial, legal and compliance requirements and risks.” Garena Digital Entertainment Business Garena, our digital entertainment business, primarily focuses on offering mobile and PC online games and developing mobile games for the global markets. 55 Table of Contents We began our digital entertainment business at our inception in 2009.
Authorized by the Foreign Exchange Regulation Act, the Central Bank of the Republic of China (Taiwan) has promulgated the Regulations Governing the Declaration of Foreign Exchange Receipts and Disbursements or Transactions, last amended on December 26, 2022, in order to deal with the declaration of foreign exchange receipts, disbursements or transactions involving NT$500,000 (US$16,329) or more or its equivalent in foreign currency.
Authorized by the Foreign Exchange Regulation Act, the Central Bank of the Republic of China (Taiwan) has promulgated the Regulations Governing the Declaration of Foreign Exchange Receipts and Disbursements or Transactions in order to deal with the declaration of foreign exchange receipts, disbursements or transactions involving NT$500,000 (US$15,249) or more or its equivalent in foreign currency.
Our digital financial services business in Thailand has obtained e-payment service business licenses for (i) electronic money services, (ii) payment facilitating services, (iii) receiving electronic payments for and on behalf of sellers, service providers or creditors, and (iv) services for transferring money by electronic means.
We have the e-payment service business licenses in Thailand for (i) electronic money services, (ii) payment facilitating services, (iii) services for receiving electronic payments for and on behalf of sellers, service providers or creditors, and (iv) services for transferring money by electronic means.
Meanwhile, we continue to expand categories to include an increasingly diverse range of products. Seller Support and Service by Shopee We offer strong support to sellers on the Shopee platform through large on-the-ground teams with deep knowledge of our local markets. Our local teams also offer fast and localized operational and technological assistance in using business management tools.
Seller Support and Service by Shopee We offer strong support to sellers on the Shopee platform through large on-the-ground teams with deep knowledge of our local markets. Our local teams also offer fast and localized operational and technological assistance in using business management tools.
See below for more details about the liability of platform providers and intermediary service providers under the E-commerce Regulation. Further, this regulation also regulates, among others, e-contracts, online advertisements and personal data protection in the e-commerce sector. This regulation governs local e-commerce sellers, as well as foreign e-commerce sellers if they actively provide their services to Indonesian consumers.
This regulation governs the restrictions and requirements for local e-commerce sellers as well as foreign e-commerce sellers if they actively provide their services to Indonesian consumers, and e-commerce platform providers and intermediary service providers. This regulation also regulates, among others, e-contracts, online advertisements and personal data protection in the e-commerce sector.
We incurred net losses of US$2.0 billion, US$1.7 billion and net income of US$162.7 million in 2021, 2022 and 2023, respectively. See “Item 5. Operating and Financial Review and Prospects—A. Operating Results—Segment Reporting” and “Item 5. Operating and Financial Review and Prospects—A.
We incurred net loss of US$1.7 billion, and net income of US$162.7 million and US$447.8 million in 2022, 2023 and 2024, respectively. See “Item 5. Operating and Financial Review and Prospects—A. Operating Results—Segment Reporting” and “Item 5. Operating and Financial Review and Prospects—A.

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Item 5. Market for Registrant's Common Equity

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Biggest changeThe chief operating decision maker reviews the performance of each segment based on revenue and certain key operating metrics of the operations and uses these results for the purposes of allocating resources to and evaluating the financial performance of each segment. 103 Table of Contents Information about segments during the years ended December 31, 2021, 2022 and 2023 presented were as follows: For the Year ended December 31, 2023 E-commerce Digital Financial Services Digital Entertainment Other Services (1) Unallocated expenses (2) Consolidated (US$ thousands) Revenue 9,000,848 1,759,422 2,172,009 131,281 – 13,063,560 Operating (loss) income (550,470 ) 490,209 1,177,871 (56,728 ) (836,104 ) 224,778 Non-operating income, net 207,616 Income tax expense (262,680 ) Share of results of equity investees (7,032 ) Net income 162,682 For the Year ended December 31, 2022 E-commerce Digital Financial Services Digital Entertainment Other Services (1) Unallocated expenses (2) Consolidated (US$ thousands) Revenue 7,288,677 1,221,996 3,877,163 61,869 – 12,449,705 Operating (loss) income (2,013,360 ) (277,264 ) 1,971,416 (252,162 ) (916,138 ) (1,487,508 ) Non-operating loss, net (13,025 ) Income tax expense (168,395 ) Share of results of equity investees 11,156 Net loss (1,657,772 ) For the Year ended December 31, 2021 E-commerce Digital Financial Services Digital Entertainment Other Services (1) Unallocated expenses (2) Consolidated (US$ thousands) Revenue 5,122,959 469,774 4,320,013 42,444 – 9,955,190 Operating (loss) income (2,766,566 ) (640,422 ) 2,500,081 (177,633 ) (498,520 ) (1,583,060 ) Non-operating loss, net (132,124 ) Income tax expense (332,865 ) Share of results of equity investees 5,019 Net loss (2,043,030 ) (1) A combination of multiple business activities that does not meet the quantitative thresholds to qualify as reportable segments are grouped together as “Other Services.” (2) Unallocated expenses are mainly related to share-based compensation, impairment of goodwill of prior acquisitions that are not under our reportable segments, and general and corporate administrative costs such as professional fees and other miscellaneous items that are not allocated to segments.
Biggest changeInformation about segments during the years ended December 31, 2022, 2023 and 2024 presented were as follows: For the Year ended December 31, 2024 E-commerce Digital Financial Services Digital Entertainment Other Services (1) Total (US$ thousands) Revenue 12,415,231 2,367,739 1,910,589 126,307 16,819,866 Less (2) Cost of revenue (8,611,530 ) (348,424 ) (610,586 ) – Sales and marketing expenses (2,966,084 ) (298,386 ) (117,556 ) – Provision for credit losses – (771,407 ) – – Other operating expenses (3) (977,048 ) (292,020 ) (203,626 ) (170,210 ) Operating segment (loss) income (139,431 ) 657,502 978,821 (43,903 ) 1,452,989 Unallocated expenses (4) (790,837 ) Operating income 662,152 Non-operating income, net 116,631 Income tax expense (321,168 ) Share of results of equity investees (9,788 ) Net income 447,827 101 Table of Contents For the Year ended December 31, 2023 E-commerce Digital Financial Services Digital Entertainment Other Services (1) Total (US$ thousands) Revenue 9,000,848 1,759,422 2,172,009 131,281 13,063,560 Less (2) Cost of revenue (6,194,900 ) (279,745 ) (672,481 ) – Sales and marketing expenses (2,510,693 ) (116,445 ) (104,721 ) – Provision for credit losses – (630,300 ) – – Other operating expenses (3) (845,725 ) (242,723 ) (216,936 ) (188,009 ) Operating segment (loss) income (550,470 ) 490,209 1,177,871 (56,728 ) 1,060,882 Unallocated expenses (4) (836,104 ) Operating income 224,778 Non-operating income, net 207,616 Income tax expense (262,680 ) Share of results of equity investees (7,032 ) Net income 162,682 For the Year ended December 31, 2022 E-commerce Digital Financial Services Digital Entertainment Other Services (1) Total (US$ thousands) Revenue 7,288,677 1,221,996 3,877,163 61,869 12,449,705 Less (2) Cost of revenue (5,871,475 ) (254,058 ) (1,077,017 ) – Sales and marketing expenses (2,328,636 ) (508,089 ) (268,061 ) – Provision for credit losses – (494,622 ) – – Other operating expenses (3) (1,101,926 ) (242,491 ) (560,669 ) (314,031 ) Operating segment (loss) income (2,013,360 ) (277,264 ) 1,971,416 (252,162 ) (571,370 ) Unallocated expenses (4) (916,138 ) Operating loss (1,487,508 ) Non-operating loss, net (13,025 ) Income tax expense (168,395 ) Share of results of equity investees 11,156 Net loss (1,657,772 ) (1) A combination of multiple business activities that does not meet the quantitative thresholds to qualify as reportable segments are grouped together as “Other Services”.
Trend Information Other than as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the year ended December 31, 2023 that are reasonably likely to have a material adverse effect on our net revenues, income, profitability, liquidity or capital resources, or that would cause reported financial information not necessarily to be indicative of future operating results or financial conditions.
Trend Information Other than as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events for the year ended December 31, 2024 that are reasonably likely to have a material adverse effect on our net revenues, income, profitability, liquidity or capital resources, or that would cause reported financial information not necessarily to be indicative of future operating results or financial conditions.
The increase was primarily driven by the increase in logistics costs as orders volume grew 8.8% from 7.6 billion in 2022 to 8.2 billion in 2023. • Digital Financial Services: Cost of revenue increased by 10.1% from US$254.1 million in 2022 to US$279.7 million in 2023, primarily driven by interest expenses in line with the growth of our loan book and increases in customer deposits under our banking business, amortization costs of internally developed software, and server and hosting expenses. • Digital Entertainment: Cost of revenue dropped by 37.6% from US$1.1 billion in 2022 to US$672.5 million in 2023, primarily from payment channel costs, which was largely in line with the decrease in digital entertainment revenue. • Cost of goods sold: Cost of goods sold was relatively stable at US$1.0 billion for 2022 and 2023.
The increase was primarily driven by the increase in logistics costs as orders volume grew 8.8% from 7.6 billion in 2022 to 8.2 billion in 2023. • Digital Financial Services: Cost of revenue increased by 10.1% from US$254.1 million in 2022 to US$279.7 million in 2023, primarily driven by interest expenses in line with the growth of our loan book and increases in customer deposits under our banking business, amortization costs of internally developed software, and server and hosting expenses. 99 Table of Contents • Digital Entertainment: Cost of revenue dropped by 37.6% from US$1.1 billion in 2022 to US$672.5 million in 2023, primarily from payment channel costs, which was largely in line with the decrease in digital entertainment revenue. • Cost of goods sold: Cost of goods sold was relatively stable at US$1.0 billion for 2022 and 2023.
(2) Sales of goods revenue mainly comes from our e-commerce business. The table below sets forth the revenue from external customers based on the geographical locations where the services were provided or goods were sold, both in absolute amount and as a percentage of total revenue for the periods indicated.
(2) Sales of goods revenue mainly comes from our e-commerce business. 91 Table of Contents The table below sets forth the revenue from external customers based on the geographical locations where the services were provided or goods were sold, both in absolute amount and as a percentage of total revenue for the periods indicated.
As of March 31, 2024, holders of an aggregate of US$0.5 million principal amount of our 2025 convertible notes have elected to convert, and approximately US$1.1 billion principal amount of our 2025 convertible notes remained outstanding. In connection with the pricing of the 2025 convertible notes, we have entered into capped call transactions with certain financial institutions.
As of March 31, 2025, holders of an aggregate of US$0.5 million principal amount of our 2025 convertible notes have elected to convert, and approximately US$1.15 billion principal amount of our 2025 convertible notes remained outstanding. In connection with the pricing of the 2025 convertible notes, we have entered into capped call transactions with certain financial institutions.
Recent Accounting Pronouncements The recent accounting pronouncement adopted during the year ended December 31, 2023 is discussed and included in Note 2(z) – Summary of Significant Accounting Policies – Recently adopted accounting pronouncements in the accompanying notes to consolidated financial statements included in “Item 17.
Recent Accounting Pronouncements The recent accounting pronouncement adopted during the year ended December 31, 2024 is discussed and included in Note 2(z) – Summary of Significant Accounting Policies – Recently adopted accounting pronouncements in the accompanying notes to consolidated financial statements included in “Item 17.
This encourages current users to invite new users to our platforms, which allows us to grow our user base with moderate acquisition cost and increases the likelihood that users will remain active and engaged and therefore spend on our platforms. 92 Table of Contents Each of our three businesses is a multi-sided platform which benefits from virtuous cycle dynamics.
This encourages current users to invite new users to our platforms, which allows us to grow our user base with moderate acquisition cost and increases the likelihood that users will remain active and engaged and therefore spend on our platforms. Each of our three businesses is a multi-sided platform which benefits from virtuous cycle dynamics.
The principal driver of our operating cash flows is cash received from sales of our services and products, including proceeds from our sales of in-game virtual items in our digital entertainment business, fees from paid advertising services, transaction-based fees, value-added services and proceeds from direct sales of goods in our e-commerce business, interest and fees received from our credit and banking businesses, fees from our mobile wallet services and premium or commissions from our insurance business, offset by operating expenses.
The principal driver of our operating cash flows is cash received from sales of our services and products, including proceeds from our sales of in-game virtual items in our digital entertainment business, fees from paid advertising services, transaction-based fees, value-added services and proceeds from direct sales of goods in our e-commerce business, interest and fees received from our credit and banking businesses, fees from our mobile wallet services and from our insurance business, offset by operating expenses.
The most significant unobservable input used in this model is the market adjustment. Market adjustment represents the estimated range of changes in industry valuations since the investee’s last external valuation. As at December 31, 2023, a 5 percentage points increase in the market adjustment input would have resulted in a decrease in the impairment charges by approximately US$19.4 million.
The most significant unobservable input used in this model is the market adjustment. Market adjustment represents the estimated range of changes in industry valuations since the investee’s last external valuation. As at December 31, 2024, a 5 percentage points increase in the market adjustment input would have resulted in a decrease in the impairment charges by approximately US$5.4 million.
Material Cash Requirements Our material cash requirements as of December 31, 2023 and any subsequent interim period mainly include our convertible notes obligations, capital expenditures, other short-term working capital commitments, bank customer deposits, and other contractual cash obligations.
Material Cash Requirements Our material cash requirements as of December 31, 2024 and any subsequent interim period mainly include our convertible notes obligations, capital expenditures, other short-term working capital commitments, bank customer deposits, and other contractual cash obligations.
Our excess sales incentive, representing the sales incentive given exceeding the revenue we expect to receive on a transaction-by-transaction basis, was less than 10% of total revenue in 2023.
Our excess sales incentive, representing the sales incentive given exceeding the revenue we expect to receive on a transaction-by-transaction basis, was less than 10% of total revenue in 2024.
The aggregate of our purchase commitments payable within the next 12 months is US$130.4 million. For further information, refer to Note 23 – Commitments and Contingencies in the accompanying notes to consolidated financial statements included in “Item 17. Financial Statements.” We have commitments to pay a minimum guarantee of royalty fees to game developers for certain online games we licensed.
The aggregate of our purchase commitments payable within the next 12 months is US$96.2 million. For further information, refer to Note 23 – Commitments and Contingencies in the accompanying notes to consolidated financial statements included in “Item 17. Financial Statements.” We have commitments to pay a minimum guarantee of royalty fees to game developers for certain online games we licensed.
We also purchase products from manufacturers and third parties and sell them directly to buyers on our Shopee platform. • In our digital financial services business, we mainly monetize by earning interest and fees from our credit and banking businesses, charging fees from our mobile wallet services and by earning premium or commission from our insurance business. • In our digital entertainment business, our primary source of revenue is the sale of in-game items.
We also purchase products from manufacturers and third parties and sell them directly to buyers on our Shopee platform. • In our digital financial services business, we mainly monetize by earning interest and fees from our credit and banking businesses, and earning fees from our mobile wallet services and our insurance business. • In our digital entertainment business, our primary source of revenue is the sale of in-game items.
For the Year Ended December 31, 2022 2023 (US$ billions, except for percentages) E-commerce service revenue 6.2 7.9 GMV 73.5 78.5 E-commerce service revenue / GMV 8.4 % 10.0 % 99 Table of Contents • Digital Financial Services: Our digital financial services revenue increased by 44.0% from US$1.2 billion in 2022 to US$1.8 billion in 2023.
For the Year Ended December 31, 2022 2023 (US$ billions, except for percentages) E-commerce service revenue 6.2 7.9 GMV 73.5 78.5 E-commerce service revenue / GMV 8.4% 10.0% • Digital Financial Services: Our digital financial services revenue increased by 44.0% from US$1.2 billion in 2022 to US$1.8 billion in 2023.
These 2024 convertible notes were offered to qualified institutional buyers pursuant to Rule 144A under the Securities Act, and certain non-U.S. persons in compliance with Regulation S under the Securities Act. The notes will mature in December 2024.
These 2024 convertible notes were offered to qualified institutional buyers pursuant to Rule 144A under the Securities Act, and certain non-U.S. persons in compliance with Regulation S under the Securities Act. These 2024 convertible notes matured in December 2024.
This is mainly due to growth of our credit business as our lending activities increased and our loans receivable grew from US$2.1 billion for the year ended December 31, 2022 to US$2.5 billion for the year ended December 31, 2023. • Digital Entertainment: Our digital entertainment revenue decreased by 44.0% from US$3.9 billion in 2022 to US$2.2 billion in 2023.
This is mainly due to growth of our credit business as our lending activities increased and our loans receivable grew from US$2.1 billion as at December 31, 2022 to US$2.5 billion as at December 31, 2023. • Digital Entertainment: Our digital entertainment revenue decreased by 44.0% from US$3.9 billion in 2022 to US$2.2 billion in 2023.
These models utilize information that is available at the reporting date about past events, current conditions, estimated recovery rate and macro-economic forecasts. As at December 31, 2023, a relative 5% decrease in the estimated recovery rate would have resulted in an increase in the allowance for credit losses by approximately US$14.8 million.
These models utilize information that is available at the reporting date about past events, current conditions, estimated recovery rate and macro-economic forecasts. As at December 31, 2024, a relative 5% decrease in the estimated recovery rate would have resulted in an increase in the allowance for credit losses by approximately US$17.9 million.
As at December 31, 2023, the recoverable value assessed exceeded the carrying amount of the asset group by a substantial margin. Goodwill Impairment Goodwill is tested for impairment annually, or whenever events or changes in circumstances indicate that it might be impaired.
As at December 31, 2024, the recoverable value assessed exceeded the carrying amount of the asset group by a substantial margin. 110 Table of Contents Goodwill Impairment Goodwill is tested for impairment annually, or whenever events or changes in circumstances indicate that it might be impaired.
These expenses are excluded from segment results as they are not reviewed by the chief operating decision maker as part of segment performance. Taxation Cayman Islands We are incorporated in the Cayman Islands and our primary business operations are conducted through our subsidiaries, branch offices and consolidated affiliated entities.
These expenses are excluded from segment results as they are not reviewed by the CODM as part of segment performance. Taxation Cayman Islands We are incorporated in the Cayman Islands and our primary business operations are conducted through our subsidiaries, branch offices and consolidated affiliated entities.
This was primarily attributable to purchase of investments of US$2.6 billion mainly consisting of time deposits and liquid investment products, an increase in loans receivable of our credit business of US$1.2 billion and purchase of property and equipment of US$924.2 million. These were partially offset by proceeds from maturity and disposal of investments of US$2.3 billion.
This was primarily attributable to purchase of investments of US$8.3 billion mainly consisting of time deposits and liquid investment products, an increase in loans receivable of our credit business of US$1.0 billion and purchase of property and equipment of US$241.6 million. These were partially offset by proceeds from maturity and disposal of investments of US$3.5 billion.
Financial Statements.” The recently issued accounting pronouncements not yet adopted during the year ended December 31, 2023 is discussed and included in Note 2(aa) – Summary of Significant Accounting Policies – Recently issued accounting pronouncements not yet adopted in the accompanying notes to consolidated financial statements included in “Item 17. Financial Statements.” 113 Table of Contents
Financial Statements.” The recently issued accounting pronouncements not yet adopted during the year ended December 31, 2024 is discussed and included in Note 2(aa) – Summary of Significant Accounting Policies – Recently issued accounting pronouncements not yet adopted in the accompanying notes to consolidated financial statements included in “Item 17. Financial Statements.”
Deposits Payable As of December 31, 2023, our consolidated balance sheets had deposits payable of US$1.7 billion, which are customer deposits from our banking business. Other Contractual Cash Obligations Our operating lease obligations, including imputed interest, were US$1.4 billion as of December 31, 2023, of which US$298.1 million is payable within the next 12 months.
Deposits Payable As of December 31, 2024, our consolidated balance sheets had deposits payable of US$2.7 billion, which are customer deposits from our banking business. Other Contractual Cash Obligations Our operating lease obligations, including imputed interest, were US$1.4 billion as of December 31, 2024, of which US$313.5 million is payable within the next 12 months.
Garena Online Private Limited was granted an additional five-year development and expansion incentive by the Singapore Economic Development Board, or the EDB, commencing from January 1, 2017, with another five-year extension commencing from January 1, 2022, which grant a concessionary tax rate of 10% from January 1, 2017 to December 31, 2021 and 10.5% from January 1, 2022 to December 31, 2026 on qualifying income, subject to certain terms and conditions imposed by the EDB.
Garena Online Private Limited was granted a five-year development and expansion incentive by the Singapore Economic Development Board, or the EDB, commencing from January 1, 2022, which grant a concessionary tax rate of 10.5% from January 1, 2022 to December 31, 2026 on qualifying income, subject to certain terms and conditions imposed by the EDB.
Conversely, a 5 percentage points decrease would have resulted in an increase in the impairment charges by approximately US$21.4 million.
Conversely, a 5 percentage points decrease would have resulted in an increase in the impairment charges by approximately US$5.7 million.
Revenue from products owned and sold by us on our Shopee platform was recorded under sales of goods revenue as discussed below. Our e-commerce service revenue constituted 40.9%, 49.7% and 60.3% of our total revenue during 2021, 2022 and 2023, respectively.
Revenue from products owned and sold by us on our Shopee platform was recorded under sales of goods revenue as discussed below. Our e-commerce service revenue constituted 49.7%, 60.3% and 64.6% of our total revenue during 2022, 2023 and 2024, respectively.
Upon conversion, we have the right, at our option, to pay or deliver, either cash, ADSs, or a combination of cash and ADSs to converting holders. During fiscal year 2023, we repurchased US$244.5 million aggregate of principal amount of our 2026 convertible notes.
Upon conversion, we have the right, at our option, to pay or deliver, either cash, ADSs, or a combination of cash and ADSs to converting holders. During fiscal year 2024, we repurchased US$329.4 million aggregate of principal amount of our 2026 convertible notes.
Under the current laws of the Cayman Islands, we are not subject to tax on income or capital gains. 104 Table of Contents Singapore Our subsidiaries incorporated in Singapore are subject to the Singapore corporate tax of 17% in 2021, 2022 and 2023.
Under the current laws of the Cayman Islands, we are not subject to tax on income or capital gains. Singapore Our subsidiaries incorporated in Singapore are subject to the Singapore corporate tax of 17% in 2022, 2023 and 2024.
Conversely, a relative 5% increase in the estimated recovery rate would have resulted in a decrease in the allowance for credit losses by approximately US$15.8 million.
Conversely, a relative 5% increase in the estimated recovery rate would have resulted in a decrease in the allowance for credit losses by approximately US$21.7 million.
Our weighted-average performance obligation period for our paying users used for the purposes of revenue recognition was 14 months as of December 31, 2023.
Our weighted-average performance obligation period for our paying users used for the purposes of revenue recognition was 17 months as of December 31, 2024.
Conversely, a one-month increase in the average paying user lifespan for each of our games would result in an approximately US$32.4 million increase in deferred revenue balance and US$6.0 million increase in deferred payment channel costs balance.
Conversely, a one-month increase in the average paying user lifespan for each of our games would result in an approximately US$19.9 million increase in deferred revenue balance and US$3.4 million increase in deferred payment channel costs balance.
Investing Activities Net cash used in investing activities amounted to US$5.8 billion in 2023. This was primarily attributable to purchase of investments of US$8.3 billion mainly consisting of time deposits and liquid investment products, an increase in loans receivable of our credit business of US$1.0 billion and purchase of property and equipment of US$241.6 million.
Investing Activities Net cash used in investing activities amounted to US$5.0 billion in 2024. This was primarily attributable to purchase of investments of US$9.6 billion mainly consisting of time deposits and liquid investment products, an increase in loans receivable of our credit business of US$2.5 billion and purchase of property and equipment of US$318.1 million.
Bookings refer to GAAP revenue for the digital entertainment segment plus change in digital entertainment deferred revenue and are used as an approximation of cash spent by our users.
The increase in change in deferred revenue is due to stronger bookings in 2024 for our digital entertainment business. Bookings refer to GAAP revenue for the digital entertainment segment plus change in digital entertainment deferred revenue and are used as an approximation of cash spent by our users.
Our obligations for leases that have not yet commenced, including imputed interest, were US$518.3 million as of December 31, 2023, of which US$10.8 million is payable within the next 12 months. For further information on our leases, refer to Note 9 – Leases in the accompanying notes to consolidated financial statements included in “Item 17.
Our obligations for leases that have not yet commenced, including imputed interest, were US$501.5 million as of December 31, 2024, of which US$18.1 million is payable within the next 12 months. For further information on our leases, refer to Note 9 – Leases in the accompanying notes to consolidated financial statements included in “Item 17.
As of December 31, 2021, 2022 and 2023, we had US$10.8 billion, US$7.6 billion and US$4.2 billion, respectively, in cash, cash equivalents and restricted cash.
As of December 31, 2022, 2023 and 2024, we had US$7.6 billion, US$4.2 billion and US$4.1 billion, respectively, in cash, cash equivalents and restricted cash.
Based on the deferred revenue and payment channel costs amounts as at December 31, 2023, a one-month decrease in the average paying user lifespan for each of our online games would result in an approximately US$42.1 million decrease in deferred revenue balance and US$7.8 million decrease in deferred payment channel costs.
Based on the deferred revenue and payment channel costs amounts as at December 31, 2024, a one-month decrease in the average paying user lifespan for each of our online games would result in an approximately US$27.9 million decrease in deferred revenue balance and US$4.9 million decrease in deferred payment channel costs.
Finally, synergies among our digital financial services business and each of our e-commerce and digital entertainment businesses allow us to increase our user base and monetization quickly and cost-effectively.
Finally, synergies among our digital financial services business and each of our e-commerce and digital entertainment businesses allow us to increase our user base and use cases, and benefit our monetization and cost efficiencies.
Risk Factors—Markets Related Risks—The ability of our subsidiaries to distribute dividends to us may be subject to restrictions under the laws of their respective jurisdictions.” Even though we currently do not require any such dividends, loans or advances from our entities for working capital and other funding purposes, we may in the future require additional cash resources from them due to changes in business conditions, to fund future acquisitions and development, or merely to declare and pay dividends or distributions to our shareholders.
Risk Factors—Markets Related Risks—The ability of our subsidiaries to distribute dividends to us may be subject to restrictions under the laws of their respective jurisdictions.” Even though we currently do not require any such dividends, loans or advances from our entities for working capital and other funding purposes, we may in the future require additional cash resources from them due to changes in business conditions, to fund future acquisitions and development, or merely to declare and pay dividends or distributions to our shareholders. 107 Table of Contents Certain of the markets in which we have significant subsidiaries or principal operating entities, including Indonesia, Thailand and Taiwan, require those subsidiaries to establish and fund statutory reserves.
For the Year Ended December 31, 2021 2022 2023 US$ Percentage of Total Revenue US$ Percentage of Total Revenue US$ Percentage of Total Revenue (thousands, except for percentages) Cost of service E-commerce 3,690,026 37.1 4,885,586 39.3 5,171,361 39.6 Digital Financial Services 105,274 1.0 254,138 2.0 279,745 2.1 Digital Entertainment 1,230,082 12.4 1,077,017 8.7 672,481 5.1 Other Services (1) 30,526 0.3 54,341 0.4 78,937 0.6 Cost of goods sold 1,003,547 10.1 993,346 8.0 1,027,389 7.9 Total cost of revenue 6,059,455 60.9 7,264,428 58.4 7,229,913 55.3 (1) Other services are a combination of multiple business activities that do not meet the quantitative threshold to qualify as reportable segments.
For the Year Ended December 31, 2022 2023 2024 US$ Percentage of Total Revenue US$ Percentage of Total Revenue US$ Percentage of Total Revenue (thousands, except for percentages) Cost of service E-commerce 4,885,586 39.3 5,171,361 39.6 7,165,351 42.6 Digital Financial Services 254,138 2.0 279,745 2.1 348,424 2.1 Digital Entertainment 1,077,017 8.7 672,481 5.1 610,586 3.7 Other Services (1) 54,341 0.4 78,937 0.6 40,026 0.2 Cost of goods sold 993,346 8.0 1,027,389 7.9 1,450,391 8.6 Total cost of revenue 7,264,428 58.4 7,229,913 55.3 9,614,778 57.2 (1) Other services are a combination of multiple business activities that do not meet the quantitative threshold to qualify as reportable segments.
Share of Results of Equity Investees We had share of profit of equity investees of US$5.0 million in 2021 and US$11.2 million in 2022. Net Loss As a result of the foregoing, we had net loss of US$2.0 billion in 2021 and US$1.7 billion in 2022.
Share of Results of Equity Investees We had share of profit of equity investees of US$11.2 million in 2022, compared to share of loss of equity investees of US$7.0 million in 2023. Net Loss or Income As a result of the foregoing, we had net loss of US$1.7 billion in 2022, compared to net income of US$162.7 million in 2023.
Gross Margin Our gross margin is defined as total gross profit, as a percentage of total revenue. The basis for gross margin for each of our business segments and the reason for the variations in the gross margins are mainly due to the different nature of our businesses.
The basis for gross margin for each of our business segments and the reason for the variations in the gross margins are mainly due to the different nature of our businesses.
E-commerce Our cost of revenue for e-commerce services primarily consists of expenses associated with our logistics and other value-added services, bank transaction fees for transactions conducted through our Shopee platform, server and hosting costs, and staff compensation and welfare costs, which include share-based compensation. 95 Table of Contents Digital Financial Services Our cost of revenue for digital financial services primarily consists of server and hosting costs, interest expenses for customer deposits under our banking business, interest expenses related to our credit business, bank transaction fees, amortization costs for internally developed software, commissions we pay to counter operators, and staff compensation and welfare costs, which include share-based compensation.
Digital Financial Services Our cost of revenue for digital financial services primarily consists of server and hosting costs, interest expenses for customer deposits under our banking business, interest expenses related to our credit business, bank transaction fees, amortization costs for internally developed software, commissions we pay to counter operators, and staff compensation and welfare costs, which include share-based compensation.
These were partially offset by proceeds from maturity and disposal of investments of US$3.5 billion. 106 Table of Contents Net cash used in investing activities amounted to US$2.4 billion in 2022.
These were partially offset by proceeds from maturity and disposal of investments of US$7.4 billion. Net cash used in investing activities amounted to US$5.8 billion in 2023.
Impairment of Goodwill We test goodwill for impairment at least annually and evaluate whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount.
We believe developing our platforms and content is extremely important to achieving our strategic objectives. Impairment of Goodwill We test goodwill for impairment at least annually and evaluate whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount.
Convertible Notes Our convertible notes obligations, including scheduled interest, were approximately US$3.2 billion as of December 31, 2023, based on the contractual maturity assuming no conversion subsequent to December 31, 2023. In June 2018, we completed an offering of 2.25% convertible senior notes in an aggregate principal amount of US$575 million, or the 2023 convertible notes.
Convertible Notes Our convertible notes obligations, including scheduled interest, were approximately US$2.7 billion as of December 31, 2024, based on the contractual maturity assuming no conversion subsequent to December 31, 2024. In November 2019, we completed an offering of 1.00% convertible senior notes in an aggregate principal amount of US$1.15 billion, or the 2024 convertible notes.
Optimization of Our Cost and Expense Structure Our cost and expense structure has several broad components: sales and marketing expenses, consisting primarily of customer acquisition and retention expenses for all our business segments; costs of logistics, including expenses for warehousing, for our e-commerce business; funding costs as well as credit and default costs, for our consumer and SME credit business; payment channel costs, royalties, amortized license fees and hosting costs for our digital entertainment business; staff compensation and welfare costs and expenses, which are spread among different functions; research and development expenses; and other costs and expenses across our businesses that are mainly fixed in nature.
At the same time, the large user base on Shopee may also increasingly explore other services and product offerings available on our digital financial services platform, such as our credit, banking and insurtech services. 90 Table of Contents Optimization of Our Cost and Expense Structure Our cost and expense structure has several broad components: sales and marketing expenses, consisting primarily of customer acquisition and retention expenses for all our business segments; costs of logistics, including expenses for warehousing, for our e-commerce business; funding costs as well as credit and default costs, for our consumer and SME credit business; payment channel costs, royalties, amortized license fees and hosting costs for our digital entertainment business; staff compensation and welfare costs and expenses, which are spread among different functions; research and development expenses; and other costs and expenses across our businesses that are mainly fixed in nature.
For the Year Ended December 31, 2021 2022 2023 US$ Percentage of Total Revenue US$ Percentage of Total Revenue US$ Percentage of Total Revenue (thousands, except for percentages) Southeast Asia 6,316,782 63.5 8,321,249 66.8 9,179,527 70.3 Latin America 1,850,861 18.6 2,043,918 16.4 2,193,758 16.8 Rest of Asia 1,394,342 14.0 1,727,187 13.9 1,496,433 11.4 Rest of the world 393,205 3.9 357,351 2.9 193,842 1.5 Total revenue 9,955,190 100.0 12,449,705 100.0 13,063,560 100.0 E-commerce E-commerce service revenue consists of revenue generated from our e-commerce marketplace services and logistics services.
For the Year Ended December 31, 2022 2023 2024 US$ Percentage of Total Revenue US$ Percentage of Total Revenue US$ Percentage of Total Revenue (thousands, except for percentages) Southeast Asia 8,321,249 66.8 9,179,527 70.3 11,774,003 70.0 Latin America 2,043,918 16.4 2,193,758 16.8 3,276,281 19.5 Rest of Asia 1,727,187 13.9 1,496,433 11.4 1,591,487 9.4 Rest of the world 357,351 2.9 193,842 1.5 178,095 1.1 Total revenue 12,449,705 100.0 13,063,560 100.0 16,819,866 100.0 E-commerce E-commerce service revenue consists of revenue generated from our e-commerce marketplace services and logistics services.
The increase in change in accrued expenses and other payables is due to: • a general increase in 2023 in payables to our logistics providers in our e-commerce business in line with orders volume growth; and • a general increase in sales and marketing expenses payable by our e-commerce business in the second half of 2023, as compared to that of the second half in 2022, which is in line with the increase in investments in growing the e-commerce business in 2023 as opposed to the focus on cost saving initiatives in our business operations in 2022.
Bookings refer to GAAP revenue for the digital entertainment segment plus change in digital entertainment deferred revenue and are used as an approximation of cash spent by our users. 104 Table of Contents The increase in change in accrued expenses and other payables is due to: • a general increase in 2023 in payables to our logistics providers in our e-commerce business in line with orders volume growth; and • a general increase in sales and marketing expenses payable by our e-commerce business in the second half of 2023, as compared to that of the second half in 2022, which is in line with the increase in investments in growing the e-commerce business in 2023 as opposed to the focus on cost saving initiatives in our business operations in 2022.
We believe that our cash and cash equivalents, together with cash generated from operating and short-term investments, will be sufficient to meet our anticipated cash needs and obligations for the next 12 months. We may also access capital markets or credit facilities should we require additional working capital.
We believe that our cash and cash equivalents, together with cash generated from operating and short-term investments, will be sufficient to meet our anticipated cash needs and obligations for the next 12 months.
Our revenue generated from digital entertainment accounted for 43.4%, 31.1% and 16.6% of our total revenue in 2021, 2022 and 2023, respectively. The primary driver for revenue in our digital entertainment business is the size of our active user base and the level of user engagement.
We recognize revenue ratably over the estimated service period. Our revenue generated from digital entertainment accounted for 31.1%, 16.6% and 11.3% of our total revenue in 2022, 2023 and 2024, respectively. The primary driver for revenue in our digital entertainment business is the size of our active user base and the level of user engagement.
Financial Statements.” We have purchase commitments of US$137.8 million as of December 31, 2023, including US$40.9 million to purchase property and equipment and hosting services, US$6.8 million committed licensing fee payable for the licensing of game titles, and US$90.1 million commitment to invest in certain companies.
Financial Statements.” We have purchase commitments of US$116.4 million as of December 31, 2024, including US$50.7 million to purchase property and equipment and hosting services, US$4.0 million committed licensing fee payable for the licensing of game titles, and US$61.7 million commitment to invest in certain companies.
In addition, in 2022, we incurred certain one-time impairment costs due to exits from non-core markets and certain divestments. 100 Table of Contents Provision for Credit Losses Our provision for credit losses increased by 23.4% from US$513.7 million in 2022 to US$633.9 million in 2023, primarily driven by an increase in lending activity during the year, in line with the growth in our loan book as our loans receivable increased by 21.3%, growing from US$2.1 billion for the year ended December 31, 2022 to US$2.5 billion for the year ended December 31, 2023.
Provision for Credit Losses Our provision for credit losses increased by 23.4% from US$513.7 million in 2022 to US$633.9 million in 2023, primarily driven by an increase in lending activity during the year, in line with the growth in our loan book as our loans receivable increased by 21.3%, growing from US$2.1 billion as at December 31, 2022 to US$2.5 billion as at December 31, 2023.
As of December 31, 2023, our long-lived assets in the E-commerce segment amounted to approximately 84.6% of our total long-lived assets and no impairment had been provided. 112 Table of Contents The accounting estimates related to impairment of long-lived assets is critical due to the magnitude of the carrying amount of long-lived assets and management’s judgment is required in estimating the recoverable value (undiscounted cash flows) of the asset group, which are sensitive to key assumptions such as projected revenue and sales and marketing expenses.
The accounting estimates related to impairment of long-lived assets is critical due to the magnitude of the carrying amount of long-lived assets and management’s judgment is required in estimating the recoverable value (undiscounted cash flows) of the asset group, which are sensitive to key assumptions such as projected revenue and sales and marketing expenses.
The table below sets forth our revenue breakdown. 93 Table of Contents For the Year Ended December 31, 2021 2022 2023 US$ Percentage of Total Revenue US$ Percentage of Total Revenue US$ Percentage of Total Revenue (thousands, except for percentages) Service revenue E-commerce 4,071,856 40.9 6,187,620 49.7 7,885,185 60.3 Digital Financial Services 469,747 4.7 1,221,996 9.8 1,759,422 13.5 Digital Entertainment 4,320,013 43.4 3,877,163 31.1 2,172,009 16.6 Other Services (1) 23,014 0.2 53,557 0.5 125,769 1.0 Sales of goods (2) 1,070,560 10.8 1,109,369 8.9 1,121,175 8.6 Total revenue 9,955,190 100.0 12,449,705 100.0 13,063,560 100.0 (1) Other services are a combination of multiple business activities that do not meet the quantitative threshold to qualify as reportable segments.
For the Year Ended December 31, 2022 2023 2024 US$ Percentage of Total Revenue US$ Percentage of Total Revenue US$ Percentage of Total Revenue (thousands, except for percentages) Service revenue E-commerce 6,187,620 49.7 7,885,185 60.3 10,862,263 64.6 Digital Financial Services 1,221,996 9.8 1,759,422 13.5 2,367,739 14.1 Digital Entertainment 3,877,163 31.1 2,172,009 16.6 1,910,589 11.3 Other Services (1) 53,557 0.5 125,769 1.0 120,672 0.7 Sales of goods (2) 1,109,369 8.9 1,121,175 8.6 1,558,603 9.3 Total revenue 12,449,705 100.0 13,063,560 100.0 16,819,866 100.0 (1) Other services are a combination of multiple business activities that do not meet the quantitative threshold to qualify as reportable segments.
For the Year Ended December 31, 2021 2022 2023 US$ Percentage of Total Revenue US$ Percentage of Total Revenue US$ Percentage of Total Revenue (thousands, except for percentages) Other operating income (287,946 ) (2.9 ) (279,184 ) (2.2 ) (221,021 ) (1.7 ) Sales and marketing expenses 3,829,743 38.5 3,269,223 26.3 2,779,223 21.3 General and administrative expenses 987,868 9.9 1,437,612 11.5 1,134,724 8.7 Provision for credit losses 117,427 1.2 513,690 4.1 633,942 4.8 Research and development expenses 831,703 8.4 1,376,501 11.0 1,164,126 8.9 Impairment of goodwill – – 354,943 2.9 117,875 0.9 Total operating expenses 5,478,795 55.1 6,672,785 53.6 5,608,869 42.9 96 Table of Contents Other Operating Income Our other operating income consists primarily of rebates from e-commerce related logistic services provided by third parties.
For the Year Ended December 31, 2022 2023 2024 US$ Percentage of Total Revenue US$ Percentage of Total Revenue US$ Percentage of Total Revenue (thousands, except for percentages) Other operating income (279,184 ) (2.2 ) (221,021 ) (1.7 ) (180,443 ) (1.1 ) Sales and marketing expenses 3,269,223 26.3 2,779,223 21.3 3,472,686 20.6 General and administrative expenses 1,437,612 11.5 1,134,724 8.7 1,267,706 7.6 Provision for credit losses 513,690 4.1 633,942 4.8 776,937 4.6 Research and development expenses 1,376,501 11.0 1,164,126 8.9 1,206,050 7.2 Impairment of goodwill 354,943 2.9 117,875 0.9 – – Total operating expenses 6,672,785 53.6 5,608,869 42.9 6,542,936 38.9 Other Operating Income Our other operating income consists primarily of rebates from e-commerce related logistic services provided by third parties. 94 Table of Contents Sales and Marketing Expenses Our sales and marketing expenses consist primarily of online and offline advertising expenses, sales incentives, and staff compensation and welfare expenses, which include share-based compensation for our employees engaged in sales and marketing functions.
Investment in Equity Securities Our investments in equity securities for which (1) we do not have the ability to exercise significant influence and (2) are without readily determinable fair value, are carried at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment in the same investee. 111 Table of Contents We evaluate these securities at each reporting period to determine whether there are indicators that the investment may be impaired (i.e. whether the fair value of these equity securities is less than the current carrying value).
Investment in Equity Securities Our investments in equity securities for which (1) we do not have the ability to exercise significant influence and (2) are without readily determinable fair value, are carried at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment in the same investee.
The following table sets forth a summary of our cash flows for the periods indicated: For the Year Ended December 31, 2021 2022 2023 (US$ thousands) Net cash generated from (used in) operating activities 208,649 (1,055,692 ) 2,079,688 Net cash used in investing activities (3,767,273 ) (2,428,809 ) (5,804,462 ) Net cash generated from financing activities 7,401,589 400,256 366,011 Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash (58,218 ) (143,511 ) (7,964 ) Net increase (decrease) in cash, cash equivalents and restricted cash 3,784,747 (3,227,756 ) (3,366,727 ) Cash, cash equivalents and restricted cash at beginning of year 7,053,393 10,838,140 7,610,384 Cash, cash equivalents and restricted cash at end of year (1) 10,838,140 7,610,384 4,243,657 (1) As of December 31, 2022, cash and cash equivalents of US$13.2 million was included in assets held for sale within prepaid expenses and other assets. 105 Table of Contents Operating Activities Net cash generated from operating activities amounted to US$2.1 billion in 2023 compared to net cash used in operating activities of US$1.1 billion in 2022.
We may also access capital markets or credit facilities should we require additional working capital. 103 Table of Contents The following table sets forth a summary of our cash flows for the periods indicated: For the Year Ended December 31, 2022 2023 2024 (US$ thousands) Net cash (used in) generated from operating activities (1,055,692 ) 2,079,688 3,277,420 Net cash used in investing activities (2,428,809 ) (5,804,462 ) (5,040,846 ) Net cash generated from financing activities 400,256 366,011 1,684,493 Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash (143,511 ) (7,964 ) (83,139 ) Net decrease in cash, cash equivalents and restricted cash (3,227,756 ) (3,366,727 ) (162,072 ) Cash, cash equivalents and restricted cash at beginning of year 10,838,140 7,610,384 4,243,657 Cash, cash equivalents and restricted cash at end of year (1) 7,610,384 4,243,657 4,081,585 (1) As of December 31, 2022, cash and cash equivalents of US$13.2 million was included in assets held for sale within prepaid expenses and other assets.
Our results of operations are also directly affected by certain factors specific to us, including the following: Size of Our User Base Our revenue is largely driven by the number of users and the level of user engagement across our three businesses, subject to other factors such as macro-economics, geopolitics and consumer spending power.
Major Factors Affecting Our Results of Operations Our results of operations and financial condition are affected by general factors driving the e-commerce, digital financial services, digital entertainment and other industries in our markets, including demographic and macro-economic growth, technology adoption trends, and the digital transformation of industries. 89 Table of Contents Our results of operations are also directly affected by certain factors specific to us, including the following: Size of Our User Base Our revenue is largely driven by the number of users and the level of user engagement across our three businesses, subject to other factors such as macro-economics, geopolitics and consumer spending power.
If our subsidiaries or any newly formed subsidiaries incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay dividends to us. 109 Table of Contents In addition, as determined in accordance with local regulations, our subsidiaries and VIEs in certain of our markets may be restricted from paying us dividends offshore or from transferring a portion of their assets to us, either in the form of dividends, loans or advances, unless certain requirements are met, and regulatory approvals are obtained.
In addition, as determined in accordance with local regulations, our subsidiaries and VIEs in certain of our markets may be restricted from paying us dividends offshore or from transferring a portion of their assets to us, either in the form of dividends, loans or advances, unless certain requirements are met, and regulatory approvals are obtained. See “Item 3. Key Information—D.
Our reporting units with material goodwill had estimated fair value exceeded the carrying value by more than 10%.
We performed our annual goodwill impairment testing in the fourth quarter of 2024. Our reporting units with material goodwill had estimated fair value exceeded the carrying value by more than 10%.
We regularly evaluate these estimates and assumptions based on the most recently available information, our own historical experiences and other factors that we believe to be relevant under the circumstances.
We regularly evaluate these estimates and assumptions based on the most recently available information, our own historical experiences and other factors that we believe to be relevant under the circumstances. Since our financial reporting process inherently relies on the use of judgments, estimates and assumptions, our actual results could differ from what we expect.
As of March 31, 2024, holders of an aggregate of US$998.0 million principal amount of our 2024 convertible notes have elected to convert, and approximately US$152.0 million principal amount of our 2024 convertible notes remained outstanding. 107 Table of Contents In connection with the pricing of the 2024 convertible notes, we have entered into capped call transactions with certain financial institutions.
In 2024, holders of the remaining US$152.0 million principal amount of our 2024 convertibles notes elected to convert prior to the notes’ maturity in December 2024. 105 Table of Contents In connection with the pricing of the 2024 convertible notes, we entered into capped call transactions with certain financial institutions.
The improvement was partially offset by lower gain on debt extinguishment of US$38.6 million recognized in 2023, as compared to gain on debt extinguishment of US$199.7 million recognized in 2022 as we repurchased our 2026 convertible notes in both periods.
The improvement was partially offset by lower gain on debt extinguishment of US$38.6 million recognized in 2023, as compared to gain on debt extinguishment of US$199.7 million recognized in 2022 as we repurchased our 2026 convertible notes in both periods. 100 Table of Contents Loss or Income before Income Tax and Share of Results of Equity Investees As a result of the foregoing, we had loss before income tax and share of results of equity investees of US$1.5 billion in 2022, compared to income before income tax and share of results of equity investees of US$432.4 million in 2023.
The operating results in any period are not necessarily indicative of the results that may be expected for any future period. 97 Table of Contents For the Year Ended December 31, 2021 2022 2023 US$ Percentage of Total Revenue US$ Percentage of Total Revenue US$ Percentage of Total Revenue (thousands, except for percentages) Selected Consolidated Statements of Operations Data: Revenue: Service revenue Digital Entertainment 4,320,013 43.4 3,877,163 31.1 2,172,009 16.6 E-commerce and other services 4,564,617 45.8 7,463,173 60.0 9,770,376 74.8 Sales of goods 1,070,560 10.8 1,109,369 8.9 1,121,175 8.6 Total revenue 9,955,190 100.0 12,449,705 100.0 13,063,560 100.0 Cost of revenue: Cost of service Digital Entertainment (1,230,082 ) (12.4 ) (1,077,017 ) (8.7 ) (672,481 ) (5.1 ) E-commerce and other services (3,825,826 ) (38.4 ) (5,194,065 ) (41.7 ) (5,530,043 ) (42.3 ) Cost of goods sold (1,003,547 ) (10.1 ) (993,346 ) (8.0 ) (1,027,389 ) (7.9 ) Total cost of revenue (6,059,455 ) (60.9 ) (7,264,428 ) (58.4 ) (7,229,913 ) (55.3 ) Gross profit 3,895,735 39.1 5,185,277 41.6 5,833,647 44.7 Operating income (expenses): Other operating income 287,946 2.9 279,184 2.2 221,021 1.7 Sales and marketing expenses (3,829,743 ) (38.5 ) (3,269,223 ) (26.3 ) (2,779,223 ) (21.3 ) General and administrative expenses (987,868 ) (9.9 ) (1,437,612 ) (11.5 ) (1,134,724 ) (8.7 ) Provision for credit losses (117,427 ) (1.2 ) (513,690 ) (4.1 ) (633,942 ) (4.8 ) Research and development expenses (831,703 ) (8.4 ) (1,376,501 ) (11.0 ) (1,164,126 ) (8.9 ) Impairment of goodwill – – (354,943 ) (2.9 ) (117,875 ) (0.9 ) Total operating expenses (5,478,795 ) (55.1 ) (6,672,785 ) (53.6 ) (5,608,869 ) (42.9 ) Operating (loss) income (1,583,060 ) (15.9 ) (1,487,508 ) (11.9 ) 224,778 1.7 Interest income 36,082 0.4 115,515 0.9 331,310 2.6 Interest expense (136,876 ) (1.4 ) (45,396 ) (0.4 ) (41,075 ) (0.3 ) Net investment loss (43,502 ) (0.4 ) (207,331 ) (1.7 ) (125,656 ) (1.0 ) Net (loss) gain on debt extinguishment (2,069 ) (0.0 ) 199,697 1.6 38,550 0.3 Foreign exchange gain (loss) 14,241 0.1 (75,510 ) (0.6 ) 4,487 0.0 (Loss) Income before income tax and share of results of equity investees (1,715,184 ) (17.2 ) (1,500,533 ) (12.1 ) 432,394 3.3 Income tax expense (332,865 ) (3.3 ) (168,395 ) (1.4 ) (262,680 ) (2.0 ) Share of results of equity investees 5,019 0.1 11,156 0.1 (7,032 ) (0.1 ) Net (loss) income (2,043,030 ) (20.5 ) (1,657,772 ) (13.3 ) 162,682 1.2 98 Table of Contents For the Year Ended December 31, 2021 2022 2023 (US$ thousands) Gross profit/(loss): Services E-commerce 381,830 1,302,034 2,713,824 Digital Financial Services 364,473 967,858 1,479,677 Digital Entertainment 3,089,931 2,800,146 1,499,528 Other Services (7,512 ) (784 ) 46,832 Sales of goods 67,013 116,023 93,786 Total gross profit 3,895,735 5,185,277 5,833,647 For the Year Ended December 31, 2021 2022 2023 (Percentage) Gross margin: Services E-commerce 9.4 21.0 34.4 Digital Financial Services 77.6 79.2 84.1 Digital Entertainment 71.5 72.2 69.0 Other Services (32.6 ) (1.5 ) 37.2 Sales of goods 6.3 10.5 8.4 Total gross margin 39.1 41.6 44.7 Year Ended December 31, 2023 Compared to Year Ended December 31, 2022 Revenue Our total revenue increased by 4.9% from US$12.4 billion in 2022 to US$13.1 billion in 2023. • E-commerce: Our e-commerce service revenue increased by 27.4% from US$6.2 billion in 2022 to US$7.9 billion in 2023.
For the Year Ended December 31, 2022 2023 2024 US$ Percentage of Total Revenue US$ Percentage of Total Revenue US$ Percentage of Total Revenue (thousands, except for percentages) Selected Consolidated Statements of Operations Data: Revenue: Service revenue 11,340,336 91.1 11,942,385 91.4 15,261,263 90.7 Sales of goods 1,109,369 8.9 1,121,175 8.6 1,558,603 9.3 Total revenue 12,449,705 100.0 13,063,560 100.0 16,819,866 100.0 Cost of revenue: Cost of service (6,271,082 ) (50.4 ) (6,202,524 ) (47.4 ) (8,164,387 ) (48.6 ) Cost of goods sold (993,346 ) (8.0 ) (1,027,389 ) (7.9 ) (1,450,391 ) (8.6 ) Total cost of revenue (7,264,428 ) (58.4 ) (7,229,913 ) (55.3 ) (9,614,778 ) (57.2 ) Gross profit 5,185,277 41.6 5,833,647 44.7 7,205,088 42.8 Operating income (expenses): Other operating income 279,184 2.2 221,021 1.7 180,443 1.1 Sales and marketing expenses (3,269,223 ) (26.3 ) (2,779,223 ) (21.3 ) (3,472,686 ) (20.6 ) General and administrative expenses (1,437,612 ) (11.5 ) (1,134,724 ) (8.7 ) (1,267,706 ) (7.6 ) Provision for credit losses (513,690 ) (4.1 ) (633,942 ) (4.8 ) (776,937 ) (4.6 ) Research and development expenses (1,376,501 ) (11.0 ) (1,164,126 ) (8.9 ) (1,206,050 ) (7.2 ) Impairment of goodwill (354,943 ) (2.9 ) (117,875 ) (0.9 ) – – Total operating expenses (6,672,785 ) (53.6 ) (5,608,869 ) (42.9 ) (6,542,936 ) (38.9 ) Operating (loss) income (1,487,508 ) (11.9 ) 224,778 1.7 662,152 3.9 Interest income 115,515 0.9 331,310 2.6 365,817 2.2 Interest expense (45,396 ) (0.4 ) (41,075 ) (0.3 ) (38,341 ) (0.2 ) Net investment loss (207,331 ) (1.7 ) (125,656 ) (1.0 ) (250,220 ) (1.5 ) Net gain on debt extinguishment 199,697 1.6 38,550 0.3 42,621 0.2 Foreign exchange (loss) gain (75,510 ) (0.6 ) 4,487 0.0 (3,246 ) (0.0 ) (Loss) Income before income tax and share of results of equity investees (1,500,533 ) (12.1 ) 432,394 3.3 778,783 4.6 Income tax expense (168,395 ) (1.4 ) (262,680 ) (2.0 ) (321,168 ) (1.9 ) Share of results of equity investees 11,156 0.1 (7,032 ) (0.1 ) (9,788 ) (0.1 ) Net (loss) income (1,657,772 ) (13.3 ) 162,682 1.2 447,827 2.7 For the Year Ended December 31, 2022 2023 2024 (US$ thousands) Gross profit/(loss): Services E-commerce 1,302,034 2,713,824 3,696,912 Digital Financial Services 967,858 1,479,677 2,019,315 Digital Entertainment 2,800,146 1,499,528 1,300,003 Other Services (784 ) 46,832 80,646 Sales of goods 116,023 93,786 108,212 Total gross profit 5,185,277 5,833,647 7,205,088 For the Year Ended December 31, 2022 2023 2024 (Percentage) Gross margin: Services E-commerce 21.0 34.4 34.0 Digital Financial Services 79.2 84.1 85.3 Digital Entertainment 72.2 69.0 68.0 Other Services (1.5 ) 37.2 66.8 Sales of goods 10.5 8.4 6.9 Total gross margin 41.6 44.7 42.8 96 Table of Contents Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Revenue Our total revenue increased by 28.8% from US$13.1 billion in 2023 to US$16.8 billion in 2024. • E-commerce: Our e-commerce service revenue increased by 37.8% from US$7.9 billion in 2023 to US$10.9 billion in 2024.
Net cash used in investing activities amounted to US$3.8 billion in 2021. This was primarily attributable to our time deposits and long-term investments such as equity investments of US$2.5 billion, an increase in loans receivable of US$1.2 billion and purchase of property and equipment of US$772.2 million.
Net cash used in investing activities amounted to US$2.4 billion in 2022. This was primarily attributable to purchase of investments of US$2.6 billion mainly consisting of time deposits and liquid investment products, an increase in loans receivable of our credit business of US$1.2 billion and purchase of property and equipment of US$924.2 million.
Sales of Goods Sales of goods revenue mainly comes from our e-commerce business. While we primarily operate as a marketplace, we also purchase products from manufacturers or third parties directly and sell on our Shopee platform under our official store to meet buyers’ demand for such products.
While we primarily operate as a marketplace, we also purchase products from manufacturers or third parties directly and sell on our Shopee platform under our official store to meet buyers’ demand for such products. Bulk purchasing and direct product sales for specific product categories also enable us to offer better product assortment and more competitive prices to our buyers.
Due to the freemium business model of our immersive games, the higher the number of active users on our games, the greater the likelihood of such users to make in-game purchases. Therefore, we believe Game QAU is a key metric to help us understand both the active user base and user engagement on our games.
Due to the freemium business model of our immersive games, the higher the number of active users on our games, the greater the likelihood of such users to make in-game purchases.
In such circumstances, the fair value of the investment is measured using the Market Adjusted Option Pricing Model Backsolve, which is determined by using information including but not limited to the pricing of recent rounds of financing of the investees, liquidity factors and a selection of comparable companies.
If, based on this evaluation, we have a reason to believe that the fair value of the investment is less than the carrying value, we then estimate the fair value and record an impairment loss equal to the difference between the fair value of the investment and its carrying amount. 109 Table of Contents In such circumstances, the fair value of the investment is measured using the Market Adjusted Option Pricing Model Backsolve, which is determined by using information including but not limited to the pricing of recent rounds of financing of the investees, liquidity factors and a selection of comparable companies.
In March 2021, the Philippines reduced its corporate income tax rate from 30% to 25%, effective retroactively from July 1, 2020. B. Liquidity and Capital Resources Cash Flows and Working Capital Our principal sources of liquidity have historically been cash generated from operating activities and financing activities including customer deposits under our banking business.
Others Subsidiaries incorporated in other jurisdictions are subject to the respective applicable corporate income tax rates of those jurisdictions. B. Liquidity and Capital Resources Cash Flows and Working Capital Our principal sources of liquidity have historically been cash generated from operating activities and financing activities including customer deposits under our banking business.
Net cash used in operating activities amounted to US$1.1 billion for the year ended December 31, 2022 compared to net cash generated from operating activities of US$208.6 million for the year ended December 31, 2021.
Net cash generated from operating activities amounted to US$2.1 billion in 2023 compared to net cash used in operating activities of US$1.1 billion in 2022.
Loss or Income before Income Tax and Share of Results of Equity Investees As a result of the foregoing, we had loss before income tax and share of results of equity investees of US$1.5 billion in 2022, compared to income before income tax and share of results of equity investees of US$432.4 million in 2023.
Income before Income Tax and Share of Results of Equity Investees As a result of the foregoing, we had income before income tax and share of results of equity investees of US$432.4 million in 2023 and US$778.8 million in 2024. Income Tax Expense We had an income tax expense of US$262.7 million in 2023 and US$321.2 million in 2024.
Our digital financial services revenue constituted 4.7%, 9.8% and 13.5% of our total revenue during 2021, 2022 and 2023, respectively. 94 Table of Contents Digital Entertainment We generate revenue from our digital entertainment business primarily by selling in-game items to our game players. We recognize revenue ratably over the estimated service period.
For loans receivable, interest and fees earned are recognized over the period of the loan based on the effective interest method. Our digital financial services revenue constituted 9.8%, 13.5% and 14.1% of our total revenue during 2022, 2023 and 2024, respectively. Digital Entertainment We generate revenue from our digital entertainment business primarily by selling in-game items to our game players.
For additional information, see the disclosure included in Note 2 – Summary of Significant Accounting Policies in the accompanying notes to consolidated financial statements included in “Item 17. Financial Statements.” Recognition of Digital Entertainment Revenue We distribute online games, including self-developed games and licensed games from game developers, through our PC and mobile based applications and certain app stores.
Financial Statements.” 108 Table of Contents Recognition of Digital Entertainment Revenue We distribute online games, including self-developed games and licensed games from game developers, through our PC and mobile based applications and certain app stores.
Our total revenue increased from US$10.0 billion in 2021 to US$13.1 billion in 2023, a CAGR of 14.6%. We had gross profit of US$3.9 billion, US$5.2 billion and US$5.8 billion in 2021, 2022 and 2023, respectively.
Our total revenue increased from US$12.4 billion in 2022 to US$16.8 billion in 2024, a CAGR of 16.2%. We had gross profit of US$5.2 billion, US$5.8 billion and US$7.2 billion in 2022, 2023 and 2024, respectively. We incurred net loss of US$1.7 billion, net income of US$162.7 million and US$447.8 million in 2022, 2023 and 2024, respectively.
Other Income, Expenses, Gains and Losses Our interest income, interest expense, net investment loss, net (loss) gain on debt extinguishment, and foreign exchange (loss) gain was a net loss of US$132.1 million in 2021 compared to a net loss of US$13.0 million in 2022.
Other Income, Expenses, Gains and Losses Our interest income, interest expense, net investment loss, net gain on debt extinguishment, and foreign exchange (loss) gain was a net income of US$207.6 million in 2023 compared to US$116.6 million in 2024. The lower non-operating income was mainly due to higher investment losses recognized in 2024, partially offset by higher interest income.
Other costs include server and hosting costs, upfront licensing fees, which are fixed and amortized over the shorter of estimated useful life or game licensing period, and staff compensation and welfare costs, which include the share-based compensation.
Other costs include server and hosting costs, upfront licensing fees, which are fixed and amortized over the shorter of estimated useful life or game licensing period, and staff compensation and welfare costs, which include the share-based compensation. 93 Table of Contents Sales of Goods Our cost of revenue for sales of goods is mainly attributable to the goods we purchase from manufacturers and third parties and sell directly to buyers on our Shopee platform.
Cost of Revenue Our total cost of revenue increased by 19.9% from US$6.1 billion in 2021 to US$7.3 billion in 2022. • E-commerce and other services: Cost of revenue for our e-commerce and other services combined increased by 35.8% from US$3.8 billion in 2021 to US$5.2 billion in 2022.
Cost of Revenue Our total cost of revenue increased by 33.0% from US$7.2 billion in 2023 to US$9.6 billion in 2024. • E-commerce: Cost of revenue increased by 38.6% from US$5.2 billion in 2023 to US$7.2 billion in 2024.
Digital Financial Services We generate revenue from our digital financial services business primarily from earning interest and fees from our credit and banking businesses, charging fees from our mobile wallet services and by earning premium or commission from our insurance business.
We monetize Shopee’s marketplace model mainly by offering sellers paid advertising services, charging transaction-based fees, and charging for certain value-added services, including logistics. Digital Financial Services We generate revenue from our digital financial services business primarily from earning interest and fees from our credit and banking businesses, earning fees from our mobile wallet services and our insurance business.
These were partially offset by proceeds from maturity and disposal of investments of US$798.2 million. Financing Activities Net cash generated from financing activities amounted to US$366.0 million in 2023.
Net cash generated from financing activities amounted to US$366.0 million in 2023.
Goodwill impairment is recognized as the excess of goodwill allocated to the reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit.
Goodwill impairment is recognized as the excess of goodwill allocated to the reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. 95 Table of Contents Results of Operations The table below sets forth a summary of our consolidated results of operations for the periods indicated, both in absolute amounts and as percentages of our total revenue.
As of December 31, 2023, the minimum guarantee commitment amounted to US$10.4 million for launched games as well as licensed but yet to be launched games, of which the full amount is payable within the next 12 months.
As of December 31, 2024, the minimum guarantee commitment amounted to US$30.9 million for launched games as well as licensed but yet to be launched games, of which US$29.3 million is payable within the next 12 months. For further information, refer to Note 23 – Commitments and Contingencies in the accompanying notes to consolidated financial statements included in “Item 17.

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Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeName Class A Ordinary Shares Underlying Outstanding Awards Granted Price (US$/Share) Date of Grant Date of Expiration Forrest Xiaodong Li 10,000,000 (1)(3) 15.0 April 30, 2019 April 30, 2029 5,000,000 (1)(3) 15.0 April 30, 2020 April 30, 2030 5,000,000 (1) 120.0 April 17, 2022 April 17, 2032 Gang Ye 4,650,000 (1) 15.0 February 28, 2018 February 28, 2028 5,000,000 (1) 120.0 April 17, 2022 April 17, 2032 Tony Tianyu Hou * (1) 15.0 February 28, 2018 February 28, 2028 * (1) 120.0 April 17, 2022 April 17, 2032 * (2) — July 31, 2023 — David Heng Chen Seng * (2) — October 19, 2021 — Khoon Hua Kuok 5,000 (2) — October 19, 2021 — David Y Ma * (1) 120.0 April 17, 2022 April 17, 2032 * (2) — May 15, 2023 — Chris Zhimin Feng 100,000 (1) 4.5 January 26, 2015 January 26, 2025 4,500,000 (1) 15.0 February 28, 2018 February 28, 2028 4,000,000 (1) 15.0 February 28, 2019 February 28, 2029 6,000,000 (1) 120.0 April 17, 2022 April 17, 2032 Terry Feng Zhao * (1) 15.0 January 31, 2019 January 31, 2029 * (1) 120.0 April 17, 2022 April 17, 2032 Yanjun Wang * (1) 15.0 February 28, 2018 February 28, 2028 * (1) 120.0 April 17, 2022 April 17, 2032 * (2) — July 31, 2023 — David Jingye Chen 220,000 (1) 4.5 January 26, 2015 January 26, 2025 2,000,000 (1) 15.0 February 28, 2018 February 28, 2028 2,000,000 (1) 120.0 April 17, 2022 April 17, 2032 All directors and executive officers as a group 59,906,667 * Each of these directors and executive officers beneficially owns less than 1% of our total outstanding shares as of December 31, 2023.
Biggest changeName Class A Ordinary Shares Underlying Outstanding Awards Granted Price (US$/Share) Date of Grant Date of Expiration Forrest Xiaodong Li 5,500,000 (1)(3) 15.0 April 30, 2019 April 30, 2029 5,000,000 (1)(3) 15.0 April 30, 2020 April 30, 2030 5,000,000 (1) 120.0 April 17, 2022 April 17, 2032 Gang Ye 1,650,000 (1) 15.0 February 28, 2018 February 28, 2028 2,000,000 (1) 120.0 April 17, 2022 April 17, 2032 833,333 (2) — April 30, 2024 — David Heng Chen Seng * (2) — October 19, 2021 — Khoon Hua Kuok 2,500 (2) — October 19, 2021 — David Y Ma * (1) 120.0 April 17, 2022 April 17, 2032 * (2) — May 15, 2023 — Silvio Savarese * (2) — August 12, 2024 — Jessica Sin Yin Tan * (2) — August 12, 2024 — Chris Zhimin Feng 4,000,000 (1) 15.0 February 28, 2018 February 28, 2028 4,000,000 (1) 15.0 February 28, 2019 February 28, 2029 2,400,000 (1) 120.0 April 17, 2022 April 17, 2032 1,000,000 (2) — April 30, 2024 — Tony Tianyu Hou * (1) 15.0 February 28, 2018 February 28, 2028 * (1) 120.0 April 17, 2022 April 17, 2032 * (2) — July 31, 2023 — Terry Feng Zhao * (1) 15.0 January 31, 2019 January 31, 2029 * (1) 120.0 April 17, 2022 April 17, 2032 Yanjun Wang * (1) 15.0 February 28, 2018 February 28, 2028 * (1) 120.0 April 17, 2022 April 17, 2032 * (2) — July 31, 2023 — David Jingye Chen 1,650,000 (1) 15.0 February 28, 2018 February 28, 2028 2,000,000 (1) 120.0 April 17, 2022 April 17, 2032 All directors and executive officers as a group 44,599,167 * Each of these directors and executive officers beneficially owns less than 1% of our total outstanding shares as of December 31, 2024.
(8) Based on a Schedule 13D/A filed with the SEC on September 8, 2022 by Tencent Holdings Limited and Tencent Limited, the number of shares beneficially owned by Tencent entities are as follows: (i) 1,816,833 Class A ordinary shares beneficially owned by Tencent Holdings Limited through Huang River Investment Limited, (ii) 98,510,410 Class A ordinary shares held by Tencent Limited, and (iii) 3,937,500 Class A ordinary shares by Tencent Growthfund Limited, a wholly-owned subsidiary of Tencent Holdings Limited.
(7) Based on a Schedule 13D/A filed with the SEC on September 8, 2022 by Tencent Holdings Limited and Tencent Limited, the number of shares beneficially owned by Tencent entities are as follows: (i) 1,816,833 Class A ordinary shares beneficially owned by Tencent Holdings Limited through Huang River Investment Limited, (ii) 98,510,410 Class A ordinary shares held by Tencent Limited, and (iii) 3,937,500 Class A ordinary shares by Tencent Growthfund Limited, a wholly-owned subsidiary of Tencent Holdings Limited.
Moreover, each executive officer has agreed not to, for a certain period following termination of his or her employment or expiration of the employment agreement: (i) carry on or be engaged, concerned or interested directly or indirectly whether as shareholder, director, employee, partner, agent or otherwise carry on any business in direct competition with us, (ii) solicit or entice away any of our customer, client, representative or agent, or (iii) employ, solicit or entice away or attempt to employ, solicit or entice away any of our officers, managers, consultants or employees. 115 Table of Contents We have entered into indemnification agreements with our directors and executive officers, pursuant to which we will agree to indemnify our directors and executive officers against certain liabilities and expenses incurred by such persons in connection with claims made by reason of their being such a director or executive officer.
Moreover, each executive officer has agreed not to, for a certain period following termination of his or her employment or expiration of the employment agreement: (i) carry on or be engaged, concerned or interested directly or indirectly whether as shareholder, director, employee, partner, agent or otherwise carry on any business in direct competition with us, (ii) solicit or entice away any of our customer, client, representative or agent, or (iii) employ, solicit or entice away or attempt to employ, solicit or entice away any of our officers, managers, consultants or employees. 113 Table of Contents We have entered into indemnification agreements with our directors and executive officers, pursuant to which we will agree to indemnify our directors and executive officers against certain liabilities and expenses incurred by such persons in connection with claims made by reason of their being such a director or executive officer.
The functions and powers of our board of directors include, among others: • convening shareholders’ annual general meetings and reporting its work to shareholders at such meetings; • declaring dividends and distributions; • appointing officers and determining the term of office of officers; • exercising the borrowing powers of our company and mortgaging the property of our company; and • approving the transfer of shares of our company, including the registering of such shares in our share register. 120 Table of Contents Terms of Directors and Executive Officers Each of our directors holds office until the expiration of his or her term, as may be provided in a written agreement with our company, and his or her successor has been elected and qualified, until his or her resignation or until his or her office is otherwise vacated in accordance with our articles of association.
The functions and powers of our board of directors include, among others: • convening shareholders’ annual general meetings and reporting its work to shareholders at such meetings; • declaring dividends and distributions; • appointing officers and determining the term of office of officers; • exercising the borrowing powers of our company and mortgaging the property of our company; and • approving the transfer of shares of our company, including the registering of such shares in our share register. 118 Table of Contents Terms of Directors and Executive Officers Each of our directors holds office until the expiration of his or her term, as may be provided in a written agreement with our company, and his or her successor has been elected and qualified, until his or her resignation or until his or her office is otherwise vacated in accordance with our articles of association.
The audit committee is responsible for, among other things: • selecting our independent registered public accounting firm and pre-approving all auditing and non-auditing services permitted to be performed by our independent registered public accounting firm; • reviewing with our independent registered public accounting firm any audit problems or difficulties and management’s response; • reviewing and approving related party transactions; • discussing the annual audited financial statements with management and our independent registered public accounting firm; • meeting periodically with the management and our internal auditor and our independent registered public accounting firm; and • reviewing and discussing our accounting and control policies and procedures and any steps taken to monitor and control major financial risk exposure. 119 Table of Contents Compensation Committee .
The audit committee is responsible for, among other things: • selecting our independent registered public accounting firm and pre-approving all auditing and non-auditing services permitted to be performed by our independent registered public accounting firm; • reviewing with our independent registered public accounting firm any audit problems or difficulties and management’s response; • reviewing and approving related party transactions; • discussing the annual audited financial statements with management and our independent registered public accounting firm; • meeting periodically with the management and our internal auditor and our independent registered public accounting firm; and • reviewing and discussing our accounting and control policies and procedures and any steps taken to monitor and control major financial risk exposure. 117 Table of Contents Compensation Committee .
(7) In September 2022, Tencent Holdings Limited and certain other Tencent entities granted an irrevocable voting proxy with respect to all their Class A ordinary shares to our board of directors to vote on matters that are subject to the vote of shareholders of Sea.
(6) In September 2022, Tencent Holdings Limited and certain other Tencent entities granted an irrevocable voting proxy with respect to all their Class A ordinary shares to our board of directors to vote on matters that are subject to the vote of shareholders of Sea.
Share Ownership The following table sets forth information concerning the beneficial ownership of our ordinary shares as of March 31, 2024: • each of our directors and executive officers; and • each person known to us to beneficially own more than 5% of our ordinary shares.
Share Ownership The following table sets forth information concerning the beneficial ownership of our ordinary shares as of March 31, 2025: • each of our directors and executive officers; and • each person known to us to beneficially own more than 5% of our ordinary shares.
As a result, we may not be aware of each person or group of affiliated persons who beneficially owns more than 5.0% of our ordinary shares. Our issued and outstanding share capital consists of Class A ordinary shares and Class B ordinary shares.
As a result, we may not be aware of each person or group of affiliated persons who beneficially owns more than 5.0% of our ordinary shares. Our share capital consists of Class A ordinary shares and Class B ordinary shares.
The table below sets forth certain information as of December 31, 2023 concerning the outstanding awards we have granted to our directors and executive officers by the time on an individual basis.
The table below sets forth certain information as of December 31, 2024 concerning the outstanding awards we have granted to our directors and executive officers by the time on an individual basis.
Share Incentive Plan We maintain a share incentive plan in order to attract, motivate, retain and reward talent, provide additional incentives to our officers, employees, directors and other eligible persons, and promote the success of our business and the interests of our shareholders. 2009 Share Incentive Plan We adopted the 2009 Plan to promote the success of our business and the interests of our shareholders by providing additional incentives to attract, motivate, retain and reward our officers, employees, directors and other eligible persons and to link the interests of the award recipients with our shareholders.
Share Incentive Plan We maintain a share incentive plan in order to attract, motivate, retain and reward talent, provide additional incentives to our officers, employees, directors and other eligible persons, and promote the success of our business and the interests of our shareholders. 114 Table of Contents 2009 Share Incentive Plan We adopted the 2009 Plan to promote the success of our business and the interests of our shareholders by providing additional incentives to attract, motivate, retain and reward our officers, employees, directors and other eligible persons and to link the interests of the award recipients with our shareholders.
He currently serves as a director at Seatown Holdings and Temasek Trust Asset Management, among other appointments, the Centre for Impact Investing and Practices, and the Singapore Art Museum. He also sits on the investment committees of ABC Impact and decarbonization investment platform GenZero.
He currently serves as a director at Seatown Holdings and Temasek Trust Asset Management, among other appointments, and the Centre for Impact Investing and Practices. He also sits on the investment committees of ABC Impact and decarbonization investment platform GenZero.
With respect to 3,706,703 Class A ordinary shares, Forrest Xiaodong Li has been given an irrevocable proxy with regard to all matters that are subject to the vote of shareholders, and such numbers are excluded from the total voting power of Mr. Chen.
With respect to 3,863,430 Class A ordinary shares, Forrest Xiaodong Li has been given an irrevocable proxy with regard to all matters that are subject to the vote of shareholders, and such numbers are excluded from the total voting power of Mr. Chen.
In September 2022, Tencent granted an irrevocable voting proxy with respect to all its Class A ordinary shares to our board of directors (duly constituted from time to time) to vote on matters that are subject to the vote of shareholders of Sea.
In September 2022, Tencent granted an irrevocable voting proxy with respect to all its Class A ordinary shares to our board of directors (duly constituted from time to time) to vote on matters that are subject to the vote of shareholders of Sea. Total voting power of Tencent excludes voting power subject to such proxy.
Over a span of 14 years, David held senior leadership roles in Singapore-headquartered global investment company Temasek, including head of real estate, head of Japan and Korea, joint head of consumer, as well as joint head of China. Prior to Temasek, David was with Deutsche Bank AG.
David has over 25 years of experience in the investment industry. Over a span of 14 years, David held senior leadership roles in Singapore-headquartered global investment company Temasek, including head of real estate, head of Japan and Korea, joint head of consumer, as well as joint head of China. Prior to Temasek, David was with Deutsche Bank AG.
Under the award agreements, with respect to the Class A ordinary shares issued upon exercise of options or vesting of restricted shares or restricted share units, almost all of our award recipients appoint Mr.
Power of Attorney on Voting . Under the award agreements, with respect to the Class A ordinary shares issued upon exercise of options or vesting of restricted shares or restricted share units, almost all of our award recipients appoint Mr.
Termination . The plan will terminate in 2027. Our board of directors may terminate the plan at any time, in whole or in part. Amendment, Suspension or Termination .
Termination . The plan will terminate in 2027. Our board of directors may terminate the plan at any time, in whole or in part. 115 Table of Contents Amendment, Suspension or Termination .
The compensation of our directors is determined by the board of directors. There is no mandatory retirement age for directors. D. Employees We had a total of approximately 67,300, 63,800 and 62,700 employees as of December 31, 2021, 2022 and 2023, respectively.
The compensation of our directors is determined by the board of directors. There is no mandatory retirement age for directors. D. Employees We had a total of approximately 63,800, 62,700 and 80,700 employees as of December 31, 2022, 2023 and 2024, respectively.
With respect to 13,111,553 Class A ordinary shares, Forrest Xiaodong Li has been given an irrevocable proxy with regard to all matters that are subject to the vote of shareholders, and such numbers are excluded from the total voting power of Mr.
With respect to 11,851,613 Class A ordinary shares, Forrest Xiaodong Li has been given an irrevocable proxy with regard to all matters that are subject to the vote of shareholders, and such numbers are excluded from the total voting power of Mr.
With respect to all these shares, Forrest Xiaodong Li has been given an irrevocable proxy with regard to all matters that are subject to the vote of shareholders, and such numbers are excluded from the total voting power of Mr. Feng. (6) Represents (i) 8,841,241 Class A ordinary shares held or beneficially owned by Mr.
With respect to all these shares, Forrest Xiaodong Li has been given an irrevocable proxy with regard to all matters that are subject to the vote of shareholders, and such numbers are excluded from the total voting power of Mr. Feng. (5) Represents (i) 9,170,802 Class A ordinary shares held or beneficially owned by Mr.
B. Compensation Compensation of Directors and Executive Officers For the year ended December 31, 2023, we paid and accrued fees and compensation in cash (excluding equity-based awards) of approximately US$ 1.6 million to our directors and executive officers as a group.
B. Compensation Compensation of Directors and Executive Officers For the year ended December 31, 2024, we paid and accrued fees and compensation in cash (excluding equity-based awards) of approximately US$2.96 million to our directors and executive officers as a group.
(2) Represents (i) 45,527,793 Class B ordinary shares held by Blue Dolphins Venture Inc, a British Virgin Islands company wholly owned by Mr. Li, (ii) 2,695,579 Class A ordinary shares beneficially owned by Mr. Li (including through an entity solely owned and controlled by Mr. Li), (iii) 17,000,000 Class A ordinary shares issuable upon exercise of options held by Mr.
(2) Represents (i) 45,527,793 Class B ordinary shares held by Blue Dolphins Venture Inc, a British Virgin Islands company wholly owned by Mr. Li, (ii) 5,144,912 Class A ordinary shares beneficially owned by Mr. Li (including through an entity solely owned and controlled by Mr. Li), (iii) 13,500,000 Class A ordinary shares issuable upon exercise of options held by Mr.
Tony Tianyu Hou has served as our director since February 2018. Tony joined our company in September 2010 and has served as our chief financial officer since January 2013. He previously served as our financial controller.
Tony Tianyu Hou joined our company in September 2010 and has served as our financial controller, and subsequently as our Chief Financial Officer since January 2013. He previously served as our director from February 2018 to August 2024.
Such proxy gives our board of directors (duly constituted from time to time) approximately 8.6% of total voting power as of March 31, 2024.
Such proxy gives our board of directors (duly constituted from time to time) approximately 8.5% of total voting power as of March 31, 2025.
In 2023, the board of directors of the company approved the cancellation of unvested options to purchase 3.75 million Class A ordinary shares to certain executive officers from the aforesaid April 2022 awards and substituted with 1.25 million restricted share units to the affected executive officers.
In 2024, the board of directors of the company approved the cancellation of unvested options to purchase 6.6 million Class A ordinary shares to certain executive officers from the aforesaid April 2022 awards and substituted with 2.2 million restricted share units to the affected executive officers.
In addition, a total of 47,016 restricted shares units were granted to our directors and executive officers in 2023, among which 37,016 restricted share units had fully vested within the year of 2023 and therefore do not show in the table below regarding the outstanding awards to our directors and executive officers as of December 31, 2023.
In addition, a total of 78,324 restricted share units were granted to our directors and executive officers in 2024, among which 58,324 restricted share units had fully vested within the year of 2024 and therefore do not show in the table below regarding the outstanding awards to our directors and executive officers as of December 31, 2024.
Li between April 2019 and April 2020 and to vest between April 2020 and April 2022. 118 Table of Contents C. Board Practice Our board of directors consists of six directors. A director is not required to hold any shares in our company to qualify to serve as a director.
Li between April 2019 and April 2020 and to vest between April 2020 and April 2022. 116 Table of Contents C. Board Practice Our board of directors consists of seven directors, four of whom are independent. A director is not required to hold any shares in our company to qualify to serve as a director.
Ye, and (ii) 6,650,000 Class A ordinary shares issuable upon exercise of options held by Mr. Ye within 60 days of March 31, 2024 and 2,834 Class A Ordinary Shares issuable upon vesting of restricted share units within 60 days from March 31, 2024 .
Ye, and (ii) 3,650,000 Class A ordinary shares issuable upon exercise of options held by Mr. Ye within 60 days of March 31, 2025 and 83,333 Class A Ordinary Shares issuable upon vesting of restricted share units within 60 days from March 31, 2025.
Directors and Executive Officers Age Position/Title Forrest Xiaodong Li 46 Chairman and Chief Executive Officer Gang Ye 43 Director and Chief Operating Officer Tony Tianyu Hou 45 Director and Chief Financial Officer David Heng Chen Seng 57 Director Khoon Hua Kuok 45 Director David Y Ma 43 Director Chris Zhimin Feng 41 President Terry Feng Zhao 40 President of Garena Yanjun Wang 43 Chief Corporate Officer, General Counsel and Company Secretary David Jingye Chen 43 Chief Product Officer of Shopee Forrest Xiaodong Li is our founder and has served as the chairman of Sea Limited and our chief executive officer since our inception in May 2009.
Directors and Executive Officers Age Position/Title Forrest Xiaodong Li 47 Chairman and Chief Executive Officer Gang Ye 44 Director and Chief Operating Officer David Heng Chen Seng 58 Independent Director Khoon Hua Kuok 46 Independent Director Silvio Savarese 53 Independent Director Jessica Sin Yin Tan 48 Independent Director David Y Ma 44 Director Chris Zhimin Feng 42 President Tony Tianyu Hou 46 Chief Financial Officer Terry Feng Zhao 41 President of Garena Yanjun Wang 44 Chief Corporate Officer, General Counsel and Company Secretary David Jingye Chen 44 Chief Product Officer of Shopee 111 Table of Contents Forrest Xiaodong Li is our founder and has served as the Chairman of Sea Limited and our Chief Executive Officer since our inception in May 2009.
The following table indicates the distribution of our employees by function as of December 31, 2023: Function Number of Employees General operation 36,900 Sales and marketing 10,600 General and administrative 5,600 Research and development 9,600 Total 62,700 We generally enter into standard confidentiality and employment agreements with our management and other employees.
The following table indicates the distribution of our employees by function as of December 31, 2024: Function Number of Employees General operation 54,600 Sales and marketing 10,300 General and administrative 6,000 Research and development 9,800 Total 80,700 We generally enter into standard confidentiality and employment agreements with our management and other employees.
The following paragraphs summarize the terms of the 2009 Plan. Plan Administration . Our board of directors or one or more committees appointed by the board act as the plan administrator. Types of Awards .
Our board of directors or one or more committees appointed by the board act as the plan administrator. Types of Awards .
David holds an M.B.A. degree from the University of Hull (United Kingdom) and a Bachelor of Engineering degree from the University of Canterbury (New Zealand). Khoon Hua Kuok has served as our director since October 2017. Khoon Hua is the chairman of Kerry Holdings Limited, the main investment holding company of the Kuok Group in Hong Kong.
David holds an M.B.A. degree from the University of Hull (United Kingdom) and a Bachelor of Engineering degree from the University of Canterbury (New Zealand). Khoon Hua Kuok has served as our director since October 2017. He currently serves as the Chairman and Chief Executive Officer of Kerry Properties Limited (a listed company in Hong Kong).
Total voting power of Tencent excludes voting power subject to such proxy. 123 Table of Contents (9) Represents 45,527,793 Class B ordinary shares held by Blue Dolphins Venture Inc, a company wholly owned by Forrest Xiaodong Li. The registered address of Blue Dolphins Venture Inc is Kingston Chambers, P.O. Box 173, Road Town, Tortola, British Virgin Islands.
(8) Represents 45,527,793 Class B ordinary shares held by Blue Dolphins Venture Inc, a company wholly owned by Forrest Xiaodong Li. The registered address of Blue Dolphins Venture Inc is Kingston Chambers, P.O. Box 173, Road Town, Tortola, British Virgin Islands.
These shares, however, are not included in the computation of the percentage ownership of any other person. 121 Table of Contents Class A Ordinary Shares Class B Ordinary Shares Percentage of Total Class A and Class B Ordinary Shares† Percentage of Total Voting Power Held †† Directors and Executive Officers: (1) Forrest Xiaodong Li (2) 69,416,146 45,527,793 18.5 59.8 Gang Ye (3) 34,087,398 — 5.9 1.7 Tony Tianyu Hou * — * * David Heng Chen Seng * — * * Khoon Hua Kuok (4) 8,207,907 — 1.4 0.7 David Y Ma * — * * Chris Zhimin Feng (5) 9,357,650 — 1.6 0.0 Terry Feng Zhao * — * * Yanjun Wang * — * * David Jingye Chen (6) 11,864,075 — 2.1 0.7 All directors and executive officers as a group (7) 213,444,147 45,527,793 41.7 71.3 Principal Shareholders: Tencent entities (8) 104,264,743 — 18.2 0.0 Blue Dolphins Venture Inc (9) — 45,527,793 7.9 56.4 Baillie Gifford & Co (10) 34,183,394 — 6.0 2.8 * Less than 1% of our total outstanding shares on an as converted basis. † For each person and group included in this column, percentage ownership is calculated by dividing the number of shares beneficially owned by such person or group, including shares that such person or group has the right to acquire within 60 days after March 31, 2024, by the sum of Class A and Class B ordinary shares, and the number of shares that such person or group has the right to acquire beneficial ownership within 60 days after March 31, 2024. †† For each person and group included in this column, percentage of total voting power represents voting power based on both Class A and Class B ordinary shares beneficially owned by such person or group with respect to all outstanding Class A and Class B ordinary shares as one single class.
These shares, however, are not included in the computation of the percentage ownership of any other person. 119 Table of Contents Class A Ordinary Shares Class B Ordinary Shares Percentage of Total Class A and Class B Ordinary Shares† Percentage of Total Voting Power Held †† Directors and Executive Officers: (1) Forrest Xiaodong Li (2) 66,507,341 45,527,793 17.8 59.1 Gang Ye (3) 30,414,766 — 5.1 1.5 David Heng Chen Seng * — * * Khoon Hua Kuok * — * * David Y Ma * — * * Silvio Savarese * — * * Jessica Sin Yin Tan * — * * Chris Zhimin Feng (4) 9,602,645 — 1.6 0.0 Tony Tianyu Hou * — * * Terry Feng Zhao * — * * Yanjun Wang * — * * David Jingye Chen (5) 12,020,802 — 2.0 0.7 All directors and executive officers as a group (6) 201,730,249 45,527,793 39.2 69.8 Principal Shareholders: Tencent entities (7) 104,264,743 — 17.6 0.0 Blue Dolphins Venture Inc (8) — 45,527,793 7.7 55.6 Baillie Gifford & Co (9) 40,954,549 — 6.9 3.3 * Less than 1% of our total outstanding shares on an as converted basis as of March 31, 2025. † For each person and group included in this column, percentage ownership is calculated by dividing the number of shares beneficially owned by such person or group, including shares that such person or group has the right to acquire within 60 days after March 31, 2025, by the sum of Class A and Class B ordinary shares, and the number of shares that such person or group has the right to acquire beneficial ownership within 60 days after March 31, 2025. †† For each person and group included in this column, percentage of total voting power represents voting power based on both Class A and Class B ordinary shares beneficially owned by such person or group with respect to all outstanding Class A and Class B ordinary shares as one single class.
Prior to this role, he served as the chief executive officer of Shopee from July 2015, and as the chief executive officer of SeaMoney from March 2020. Previously he served as our head of mobile business.
Chris Zhimin Feng joined our company in March 2014 and has served as President since January 2022. Prior to this role, he served as the chief executive officer of Shopee from July 2015, and as the chief executive officer of SeaMoney from March 2020. Previously he served as our head of mobile business.
Chen, and (ii) 3,020,000 Class A ordinary shares issuable upon exercise of options held by Mr. Chen within 60 days of March 31, 2024 and 2,834 Class A Ordinary Shares issuable upon vesting of restricted share units within 60 days from March 31, 2024 .
Chen, and (ii) 2,850,000 Class A ordinary shares issuable upon exercise of options held by Mr. Chen within 60 days of March 31, 2025.
Li), including 27,997,705 Class A ordinary shares issuable upon exercise of options within 60 days of March 31, 2024 and 1,224,424 Class A ordinary shares issuable upon vesting of restricted share units within 60 days of March 31, 2024. (3) Represents (i) 27,434,564 Class A ordinary shares held or beneficially owned by Mr.
Li), including 23,283,266 Class A ordinary shares issuable upon exercise of options within 60 days of March 31, 2025 and 1,288,195 Class A ordinary shares issuable upon vesting of restricted share units within 60 days of March 31, 2025. (3) Represents (i) 26,681,433 Class A ordinary shares held or beneficially owned by Mr.
Li has received irrevocable voting proxies from the respective owners of such shares (including certain directors and employees, certain affiliates of our employees, Garena ESOP Program (PTC) Limited and a family member of Mr.
Li within 60 days of March 31, 2025, and (iv) an aggregate of 47,862,429 Class A ordinary shares over which Mr. Li has received irrevocable voting proxies from the respective owners of such shares (including certain directors and employees, certain affiliates of our employees, Garena ESOP Program (PTC) Limited and a family member of Mr.
Currently, the maximum aggregate number of ordinary shares which may be issued pursuant to all awards under the 2009 Plan is 210,888,606.
Currently, the maximum aggregate number of ordinary shares which may be issued pursuant to all awards under the 2009 Plan is 228,561,966. The awards expire 10 years after the date of the grant.
We are not aware of any arrangement that may, at a subsequent date, result in a change of control of our company. For certain information as of December 31, 2023 concerning the outstanding awards we have granted to our directors and executive officers individually pursuant to our share incentive plan, see “—B.
For certain information as of December 31, 2024 concerning the outstanding awards we have granted to our directors and executive officers individually pursuant to our share incentive plan, see “—B.
Previously he served as a partner at Hillhouse Capital, and worked at Bain Capital and Boston Consulting Group. David holds a bachelor’s degree in Economics, Finance, and Management from the Wharton School of the University of Pennsylvania. Chris Zhimin Feng joined our company in March 2014 and has served as President since January 2022.
He was the founder and Managing Partner of Composite Capital, a global investment management firm. Previously he served as a partner at Hillhouse Capital, and worked at Bain Capital and Boston Consulting Group. David holds a Bachelor’s degree in Economics, Finance, and Management from the Wharton School of the University of Pennsylvania.
He is also a director of Kerry Group Limited and Kuok (Singapore) Limited, the chairman and chief executive officer of Kerry Properties Limited and the non-executive vice chairman of Kerry Logistics Network Limited, both of which are companies listed on the Hong Kong Stock Exchange, and a non-executive director of Wilmar International Limited, a company listed on the Singapore Stock Exchange.
Khoon Hua is the Chairman of Kerry Holdings Limited and a Director of Kerry Group Limited and Kuok (Singapore) Limited. He also serves as the Vice Chairman and a Non-Executive Director of Kerry Logistics Network Limited (a listed company in Hong Kong), a Non-Executive and Non-Independent Director of Wilmar International Limited (a listed company in Singapore).
(10) Based on a Schedule 13G filed with the SEC on January 26, 2024 by Baillie Gifford & Co (“Baillie Gifford”), Baillie Gifford reported sole voting power over 22,321,284 ADSs, each representing one Class A ordinary share, and sole dispositive power over 34,183,394 ADSs.
(9) Based on a Schedule 13G filed with the SEC on February 12, 2025 by Baillie Gifford & Co (“Baillie Gifford”), Baillie Gifford reported sole voting power over 29,574,967 ADSs, each representing one Class A ordinary share, and sole dispositive power over 40,954,549 ADSs.
Khoon Hua holds a B.A. degree in Economics from Harvard University. 114 Table of Contents David Y Ma has served as our director since May 2023. He previously worked at Sea as the Chief Investment Officer of Sea Capital from March 2021 to April 2023. He was the founder and Managing Partner of Composite Capital, a global investment management firm.
Jessica holds a master’s degree in Electrical Engineering and Computer Science and two Bachelor’s degrees in Electrical Engineering and Economics from the Massachusetts Institute of Technology. 112 Table of Contents David Y Ma has served as our director since May 2023. He previously worked at Sea as the Chief Investment Officer of Sea Capital from March 2021 to April 2023.
David Jingye Chen is our co-founder and serves as the chief product officer of Shopee. He was formerly chief of staff, a position he held from January 2017 to December 2019. Prior to that, David served as our chief operating officer from our inception in May 2009 to December 2016. He previously held positions at PSA Corporation Limited.
She holds a J.D. degree from Harvard Law School and a B.A. degree in Economics from Harvard University. David Jingye Chen is our co-founder and serves as the Chief Product Officer of Shopee. He was formerly Chief of Staff, a position he held from January 2017 to December 2019.
To the extent set forth in the 2009 Plan and where required by the applicable laws, rules or regulations, any amendments to the 2009 Plan shall be subject to shareholders’ approval. 117 Table of Contents Transfer Restrictions.
To the extent set forth in the 2009 Plan and where required by the applicable laws, rules or regulations, any amendments to the 2009 Plan shall be subject to shareholders’ approval. Transfer Restrictions. All awards are non-transferable and will not be subject in any manner to sale, transfer, anticipation, alienation, assignment, pledge, encumbrance or charge except in certain situations.
Terry holds a bachelor’s degree in Computer Engineering with first class honors from Nanyang Technological University. Yanjun Wang is our chief corporate officer, general counsel and company secretary. Yanjun has served as our chief corporate officer since May 2019, company secretary since November 2017 and general counsel since March 2014.
Prior to assuming his current role, Terry has also served in a number of senior roles in our digital entertainment business across several key markets. Terry holds a Bachelor’s degree in Computer Engineering with first class honors from Nanyang Technological University. Yanjun Wang is our Chief Corporate Officer, general counsel and company secretary.
David holds a bachelor’s degree in Computer Engineering with first class honors from the National University of Singapore. Employment Agreements and Indemnification Agreements We have entered into employment agreements with our executive officers. Each of our executive officers is employed for a continuous term unless either we or the executive officer gives prior notice to terminate such employment.
Each of our executive officers is employed for a continuous term unless either we or the executive officer gives prior notice to terminate such employment.
He holds an M.B.A. degree from the University of Chicago’s Booth School of Business and a bachelor’s degree in Accounting from Fudan University. David Heng Chen Seng has served as our director since October 2017. David is the chief executive officer of Temasek Trust Asset Management, a Singapore-based global asset management firm established by Temasek Trust.
David Heng Chen Seng has served as our director since October 2017. David is the Chief Executive Officer of Temasek Trust Asset Management, a Singapore based global asset management firm established by Temasek Trust. Under his leadership, Temasek Trust Asset Management operates two core investment units – ABC Impact and Temasek Trust Capital.
Prior to joining our company, Yanjun was an attorney at Skadden, Arps, Slate, Meagher & Flom LLP and Kirkland & Ellis. She is qualified to practice law in the State of New York. She holds a J.D. degree from Harvard Law School and a B.A. degree in Economics from Harvard University.
Yanjun has served as our Chief Corporate Officer since May 2019, company secretary since November 2017 and general counsel since March 2014. Prior to joining our company, Yanjun was an attorney at Skadden, Arps, Slate, Meagher & Flom LLP and Kirkland & Ellis. She is qualified to practice law in the State of New York.
Li within 60 days of March 31, 2024 and 2,834 Class A Ordinary Shares issuable upon vesting of restricted share units within 60 days from March 31, 2024 , and (iv) an aggregate of 49,717,733 Class A ordinary shares over which Mr.
Feng within 60 days of March 31, 2025, and (iii) 100,000 Class A Ordinary Shares issuable upon vesting of restricted share units within 60 days from March 31, 2025.
As of March 31, 2024, 392,323,309 of our Class A ordinary shares were held as ADSs by the depositary for our ADS holders. Other than the depositary, we are not aware of any record shareholder being a United States citizen or an entity incorporated in the United States as of March 31, 2024.
Other than the depositary, we are not aware of any record shareholder being a United States citizen or an entity incorporated in the United States as of March 31, 2025. 121 Table of Contents We are not aware of any arrangement that may, at a subsequent date, result in a change of control of our company.
The awards expire 10 years after the date of the grant. 116 Table of Contents As of March 31, 2024, outstanding awards granted under the 2009 Plan consisted of (i) options to purchase 59,598,234 Class A ordinary shares, (ii) 16,005,794 restricted Class A ordinary share units, and (iii) 267,574 share appreciation rights.
As of March 31, 2025, outstanding awards granted under the 2009 Plan consisted of (i) options to purchase 41,783,266 Class A ordinary shares, (ii) 12,737,386 restricted Class A ordinary share units, and (iii) 191,484 share appreciation rights. The following paragraphs summarize the terms of the 2009 Plan. Plan Administration .
(5) Represents (i) 354,816 Class A ordinary shares held or beneficially owned by Mr. Feng, and (ii) 9,000,000 Class A ordinary shares issuable upon exercise of options held by Mr. Feng within 60 days of March 31, 2024 and 2,834 Class A Ordinary Shares issuable upon vesting of restricted share units within 60 days from March 31, 2024 .
Ye. 120 Table of Contents (4) Represents (i) 102,645 Class A ordinary shares held or beneficially owned by Mr. Feng, (ii) 9,400,000 Class A ordinary shares issuable upon exercise of options held by Mr.
Terry Feng Zhao has been with our company since our inception in 2009 and has served as the president of Garena since November 2018. Prior to assuming his current role, Terry has also served in a number of senior roles in our digital entertainment business across several key markets.
He holds an M.B.A. degree from the University of Chicago’s Booth School of Business and a bachelor’s degree in Accounting from Fudan University. Terry Feng Zhao has been with our company since our inception in 2009 and has served as the President of Garena since November 2018.
Removed
Under his leadership, Temasek Trust Asset Management operates two core investment units – ABC Impact and Temasek Trust Capital. David has over 25 years of experience in the investment industry.
Added
Khoon Hua holds a Bachelor’s degree in Economics from Harvard University in the United States. Silvio Savarese has served as our director since August 2024. Dr. Savarese currently serves as Executive Vice President and Chief Scientist of Salesforce Research where he leads the AI Research organization and various AI related investments and shapes its scientific direction and long-term AI strategy.
Removed
All awards are non-transferable and will not be subject in any manner to sale, transfer, anticipation, alienation, assignment, pledge, encumbrance or charge except in certain situations. Power of Attorney on Voting .
Added
He has been in this position since April 2021. Dr. Savarese has also been an adjunct professor of Computer Science at Stanford University since April 2021, and was previously an associate professor with tenure from April 2017 to April 2021 and an assistant professor from September 2013 to April 2017.
Removed
The calculations in the table below are based on 574,340,007 ordinary shares issued and outstanding as of March 31, 2024, comprising 528,812,214 Class A ordinary shares and 45,527,793 Class B ordinary shares. Beneficial ownership is determined in accordance with the rules and regulations of the SEC.
Added
Prior to Stanford, he was an assistant professor of Electrical and Computer Engineering at the University of Michigan from 2008 to 2013. Dr. Savarese earned his Ph.D. in Electrical Engineering from the California Institute of Technology. Jessica Sin Yin Tan has served as our director since August 2024.
Removed
Ye. 122 Table of Contents (4) Includes (i) 200,000 Class A ordinary shares held or beneficially owned by Bright Magic Investments Limited, a British Virgin Islands company, (ii) 2,926,071 Class A ordinary shares held by Fexos Limited, a British Virgin Islands company, (iii) 1,701,945 Class A ordinary shares beneficially owned by Macromind Investments Limited, a British Virgin Islands company (iv) 705,184 Class A ordinary shares held by City Jet Limited, a British Virgin Islands company, (v) 104,616 Class A ordinary shares beneficially owned by Joyce M.
Added
Jessica served as the Group co-CEO and Executive Director of Ping An Group between January 2013 and December 2023. She is also a member of the board of directors of Ping An Bank Co Ltd., listed on the Shenzhen Stock Exchange.
Removed
Kuok Foundation, a Hong Kong company, (vi) 104,616 Class A ordinary shares beneficially owned by Zheng Ge Ru Foundation, a Hong Kong company, and (vii) 322,000 shares held by Always Best International Limited, a Hong Kong company. Bright Magic Investments Limited, Fexos Limited, and Macromind Investments Limited are all wholly-owned subsidiaries of Kerry Group Limited. Mr.
Added
Prior to joining Ping An Group, Jessica was a global partner at McKinsey & Company from June 2000 to December 2012 in its United States and Asia offices. She is also on the boards of the Central Provident Fund Board, the National Healthcare Group, and the Agency Integrated Care, three non-profit organizations in Singapore.
Removed
Kuok is a director of Kerry Group Limited and has indirect minority interests in these entities. Mr. Kuok may be deemed to have beneficial interests in the shares beneficially owned by these entities. City Jet Limited’s shareholders are Joyce M. Kuok Foundation and Zheng Ge Ru Foundation. As Mr.
Added
Jessica is a member of the advisory panel of the Monetary Authority of Singapore and the World Bank Private Sector Investment Lab.
Removed
Kuok is a governor of these two foundations, he may be deemed to have or share investment power which includes the power to dispose, or to direct the disposition of, the shares beneficially owned by City Jet Limited and these two foundations. Always Best International Limited is an investment company of a discretionary trust in which Mr.
Added
Prior to that, David served as our Chief Operating Officer from our inception in May 2009 to December 2016. He previously held positions at PSA Corporation Limited. David holds a Bachelor’s degree in Computer Engineering with first class honors from the National University of Singapore. Employment Agreements and Indemnification Agreements We have entered into employment agreements with our executive officers.
Removed
Kuok is one of the discretionary beneficiaries. Mr. Kuok disclaims beneficial ownership of ordinary shares held or beneficially owned by all of the aforesaid entities for all other purposes. The business address of Kerry Group Limited is 32/F, Kerry Centre, 683 King’s Road, Quarry Bay, Hong Kong.
Added
The calculations in the table below are based on 592,019,934 ordinary shares outstanding as of March 31, 2025, comprising 546,492,141 Class A ordinary shares (excluding Class A ordinary shares issued to the depositary bank for bulk issuance of ADSs reserved for future issuances upon the exercise or vesting of awards granted under our share incentive plan) and 45,527,793 Class B ordinary shares.
Removed
The business address or registered office of all the other aforesaid entities is 31/F, Kerry Centre, 683 King’s Road, Quarry Bay, Hong Kong, except for City Jet Limited whose registered office is at Vistra Corporate Services Centre, Wickhams Cay II, Road Town, Tortola, VG1110, British Virgin Islands. Shares beneficially owned by Mr.
Added
Beneficial ownership is determined in accordance with the rules and regulations of the SEC.
Removed
Kuok do not include the shares issuable upon conversion of the following convertible notes which were not convertible accordingly to their respective terms and conditions within 60 days of March 31, 2024: (i) US$100 million principal amount of our 2024 convertible notes currently held by Macromind Investments Limited, (ii) US$10 million principal amount of our 2025 convertible notes currently held by Velmar Company Limited, a Hong Kong company , wholly owned by Kerry Group Limited, and (iii) US$35 million principal amount of our 2026 convertible notes currently held by Merrywood Investments Limited, a British Virgin Islands company , wholly owned by Kerry Group Limited, subject to the terms and conditions of such notes .
Added
As of March 31, 2025, 414,849,045 of our outstanding Class A ordinary shares were held as ADSs by the depositary for our ADS holders.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

2 edited+0 added−1 removed0 unchanged
Biggest changeFinancial Statements.” Contractual Arrangements with Our VIEs, Their Shareholders and Us See “Item 4. Information on the Company—C. Organizational Structure—Contractual Arrangements among Our VIEs, Their Shareholders and Us.” 124 Table of Contents Share Incentive Plan See “Item 6. Directors, Senior Management and Employees—B. Compensation—Share Incentive Plan.” Employment Agreements and Indemnification Agreements See “Item 6. Directors, Senior Management and Employees—A.
Biggest changeInformation on the Company—C. Organizational Structure—Contractual Arrangements among Our VIEs, Their Shareholders and Us.” Share Incentive Plan See “Item 6. Directors, Senior Management and Employees—B. Compensation—Share Incentive Plan.” Employment Agreements and Indemnification Agreements See “Item 6. Directors, Senior Management and Employees—A. Directors and Senior Management—Employment Agreements and Indemnification Agreements.” C. Interest of Experts and Counsel Not applicable.
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS A. Major Shareholders See “Item 6. Directors, Senior Management and Employees—E. Share Ownership.” B. Related Party Transactions In October 2023, we deconsolidated a subsidiary. For further information, refer to Note 20 – Related Party Transactions in the accompanying notes to consolidated financial statements included in “Item 17.
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS A. Major Shareholders See “Item 6. Directors, Senior Management and Employees—E. Share Ownership.” B. Related Party Transactions See Note 20 – Related Party Transactions in the accompanying notes to consolidated financial statements included in “Item 17. Financial Statements.” Contractual Arrangements with Our VIEs, Their Shareholders and Us See “Item 4.
Removed
Directors and Senior Management—Employment Agreements and Indemnification Agreements.” C. Interest of Experts and Counsel Not applicable.

Other SE 10-K year-over-year comparisons