In this article

Shopee’s parent company, Sea Ltd, posted its quarterly results, retaining the triple digit pace of growth, with its revenue jumping by over 160 per cent year on year.

Meanwhile, its chief competitor, Chinese giant Alibaba, reported a strong but considerably smaller growth of 54 per cent for its international businesses combined — Aliexpress, Lazada, Trendyol and Daraz — earlier this month.

These four companies generated around US$1.6 billion in revenue for the quarter ending June 30, compared to Shopee’s US$1.2 billion. 

Alibaba does not provide a specific breakdown per business, but given Aliexpress’ global reach, it must mean that Lazada is already trailing Shopee badly in the region and the gap keeps growing all the time, as Singapore’s centicorn has managed to grow its e-commerce business nearly seven-fold since 2019.

Even more noteworthy, however, is the fact that at the current pace, Shopee is not only going to leave Lazada in the dust in SEA, but will eclipse Alibaba’s entire international e-commerce business, even though it is rooted in a single region (and merely just started venturing into Latin America). And this may happen as soon as the first or second quarter of 2022.

Sea vs Alibaba’s financial results

Evolution of Q2 results, year after year / Source: Sea Ltd. and Alibaba

Sea’s guidance for full year results is estimated at US$4.7 to US$4.9 billion in revenue in 2021, which would already beat Alibaba’s international results during the calendar year 2020.

This gives further credence to the allegation that Jack Ma’s brainchild is failing badly outside of China, struggling to secure a stronger foothold abroad.

At first glance, over 50 per cent in revenue growth year-on-year seems respectable, but not only does it pale in comparison to its competitors, it is also just five per cent of the Chinese giant’s annual revenue.

That said, Alibaba is still very much a China-first company. Despite years of foreign investments and a popular, maverick founder giving it global publicity, it has yet to successfully crack markets outside of its homeland.

Meanwhile, Sea continues its rise during the pandemic, in part because of strong e-commerce performance and in part to equally solid digital entertainment business which has also benefited from the lockdowns keeping millions of people stuck at home.

In total, the company is about to crack the US$10 billion revenue ceiling this year and its stock keeps beating records, having rallied ten-fold since 2019 and putting the current market capitalisation at around US$170 billion, making it Singapore’s most valuable enterprise.

Chasing Amazon?

Given this success, the question is no longer whether Shopee can compete with regional rivals, but whether it can replicate its success elsewhere abroad.

So far, Amazon is really the only truly international e-commerce company. No other tech enterprise has managed to transcend borders quite like it has, but surely there must be space for a meaningful competitor to grow eventually. 

So far, Chinese rivals are failing to make a dent, despite proximity to a large and cheap manufacturing base. Other online commerce clones have taken root in individual countries or regions but struggle to venture away from what they know best.

Shopee’s ease at combating much older and wealthier companies suggests that it may find success elsewhere too.

The litmus test of its international ambitions is going to be its performance in Latin America, where it has already launched in Brazil, Chile, Colombia and Mexico.

Shopee keeps growing in Brazil with close to 50 million visitors in June 2021, but it’s still behind the Mercado Livre at 250 million / Image Credit: Similarweb

US$10 billion in annual revenue this year will put it in the top 20 largest internet companies in the world.

But as Amazon is about to cross US$400 billion, it looks like the pie is large enough to keep the Singaporean upstart growing if it can entice foreign audiences. The best, it seems, is yet to come.

Featured Image Credit: Reuters

Categories: Opinions, E-Commerce

Subscribe to our newsletter

Stay updated with Vulcan Post weekly curated news and updates.


Vulcan Post aims to be the knowledge hub of Singapore and Malaysia.

© 2021 GRVTY Media Pte. Ltd.
(UEN 201431998C.)

Vulcan Post aims to be the knowledge hub of Singapore and Malaysia.

© 2021 GRVTY Media Pte. Ltd.
(UEN 201431998C.)