How does Sea Group continue operating on such huge losses ($373 million in 2020)? Why would people buy their stocks? Wouldn’t their debt catch up since they’ve been operating on losses?

Take a look at Amazon before they hit the 1 trillion dollar mark.

Take a look at Apple in 2000 before they became the first 2 trillion-dollar company.

Take a look at SoftBank's performance in the last few years and how much money they lost.

The success rate is low, but rewards are astronomical when they succeed.

If you invest like an entrepreneur, expect results like an entrepreneur. You either make it or you lose everything.

If you invest like a professional fund manager, expect results like a fund manager. You get steady returns but you will never get rich quick.

Welcome to entrepreneurship.

These are growing businesses. They lose money. That is how it works for the majority of companies that target aggressive growth.

If you read investment books, you will never understand how these company operate.

Read business books. Follow me here.​​​

Hi anon,

SEA group has raised tremendous amounts of money via series A, B, C, etc funding.

As with any firm trying to gain a foothold, they have to sacrifice profitability while attempting to break into the market.

A prime example is Grab. They've under cut taxis (and Uber) and penetrated Singapore's market with tremendous discounts, entice taxi drivers to hop over with incentive, etc. Now it's a two way dog fight, and they've been raising prices (so my wife reports, I don't take grab myself) to compensate for all the losses they have to take over the years. I find that taxis might even been cheaper than grab now.

The market prices stocks on expectations. If you expect that a company will be profitable, you don't buy the stocks only when it annouces a profit. You buy it early because you expect that the profit will be annouced in due course (and by extension, the share price increases). That is why their stock has been on the rise.

I haven't analyzed their balance sheets, but yes, they have to find a way to reduce losses and eventually eliminate them. But before that happens, euphoria drives the rally. Just look at Tesla.