Sea Limited, a leading digital entertainment and e-commerce company, has reported its financial results for the second quarter, showcasing a significant increase in revenue despite a decrease in earnings per share. The company's revenue soared to an impressive $3.81 billion for the three months ended June 30, marking a substantial improvement from $3.1 billion recorded in the same period last year.
This data also surpassed the consensus estimates on Capital IQ, which had projected revenue of $3.72 billion. While revenue escalated, Sea Limited's earnings per share (EPS) saw a decline, dropping to $0.14 from $0.54 a year earlier. Analysts surveyed by Capital IQ were expecting the company to report earnings of $0.19 on a generally accepted accounting principles (GAAP) basis.
Notably, the company's total operating expenses surged by 29% year over year, reaching $1.5 billion, with sales and marketing expenses experiencing a substantial increase of 57%. This rise in expenses reflects Sea Limited's strategic push to enhance its market presence across the Southeast Asia region. The e-commerce segment, known predominantly through its platform Shopee, exhibited remarkable growth, with revenue soaring by 34% year over year to $2.82 billion.
This impressive performance was driven by a roughly 33% increase in marketplace revenue. In particular, core marketplace revenue, which encapsulates transaction-based fees and advertising revenues, grew significantly by approximately 41%. Additionally, Sea's value-added services associated with logistics recorded a 16% uptick in sales. Forrest Li, Chief Executive of Sea Limited, commented on the performance during a conference call with analysts, noting, "Generally, retail and consumer spending trends in the Southeast Asia region have remained healthy, with domestic consumption continuing to be a main driver of economic performance in many markets.
This sets a very strong micro foundation for our e-commerce business." In the digital financial services sector, revenue also posted a robust increase of 21% year over year, amounting to $519.3 million in the second quarter. However, revenue within the digital entertainment arena saw a decline of 18% compared to last year, totaling $435.6 million.
This dip is attributed to lower recognition of accumulated deferred revenue due to reduced bookings in previous quarters. The company's active user base in the digital entertainment division witnessed a significant increase, rising by 19% year over year to reach 648 million in the second quarter. Meanwhile, the number of paying users surged by approximately 22%, reaching 52.5 million, indicating a robust engagement level with Sea Limited's offerings. Looking forward, Li expressed confidence in the company's trajectory, stating, "With the strong results delivered in the first half and our outlook for the rest of the year, we expect that Shopee will become adjusted EBITDA positive from the third quarter.
We are also revising up our guidance for Shopee's 2024 full year gross merchandise value growth rate to the mid-20s." The company's stock price closed at 68.94, reflecting a change of +2.02 (+3.02%)..