Shulou(Shulou.com)11/24 Report--

On the afternoon of September 9, Beijing time, it is reported that Shopee, the e-commerce unit of Southeast Asian Internet giant Sea, has told employees that it will close its local operations in Chile, Colombia and Mexico and withdraw from the Argentine market completely.

After closing local operations in Chile, Colombia and Mexico, Sea will maintain cross-border operations in those three markets, but will cut most of its team's staff and dozens of employees will be affected, according to three people familiar with the matter. The Brazilian market, by contrast, will not be affected because Shopee has become the dominant service provider there.

"given the increased uncertainty in the current macro situation, we need to focus our resources on our core business," Chris Feng, Shopee chief executive (CEO), said in an email to employees. To this end, the company decided to focus only on cross-border business in Mexico, Colombia and Chile. "

Subsequently, Shopee confirmed to the media that it would operate cross-border operations in Chile, Colombia and Mexico and completely shut down its Argentine operations.

Sea's market capitalization soared to more than $200 billion last October because its gaming and ecommerce divisions were hugely popular during the outbreak. But the company's share price has plummeted since then and now has a market capitalization of only about $27 billion.

Sea's leadership has issued internal instructions to Shopee managers to make Shopee profitable in its main markets in south-east Asia by 2023, according to people familiar with the matter.

Ko Ke Yan, chief analyst at DZT Research, a Singapore-based research firm, said: "Shopee has a history of seven to eight years, and now they must focus on making a profit in their core markets."

In fact, Shopee announced in March that it would close its operations in India and France. In June, Shopee also cut jobs in its e-commerce and food distribution units, including operations in Southeast Asia and Latin America. In the past two weeks, Shopee has laid off dozens of jobs.

Sea last month reported second-quarter 2022 revenue of $2.9 billion, up 29% from a year earlier. The net loss was $931.2 million, compared with a net loss of $433.7 million in the same period last year. Without GAAP, the net loss was $569.8 million, compared with a net loss of $321.2 million in the same period last year.

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