Sea Limited, Singaporean ecommerce company and owner of mobile developer Garena, announced that they would be freezing salaries for unpromoted staff and paying out lower end of year bonuses at the end of 2022.
The move comes as the company weathers a difficult business year for nearly all of its various holdings, including in the mobile gaming industry.
The post-Covid slump can be blamed partially for the turmoil that Sea Limited have been facing. As well as the involvement of larger, traditionally ‘triple-a’ companies that are furthering the already hyper-competitive world of mobile gaming. Both Activision-Blizzard and Take-Two Interactive became mobile-first in terms of revenue for example. Sea Ltd have also been facing issues with their ecommerce platform Shopee, with layoffs taking place earlier in the year.
What does this mean?
Garena, and by extension their parent company, have been having a difficult time as of late. The company saw a $1bn loss in the final quarter of 2022, with the company shutting down projects and laying off staff. This end of year freeze for staff who have not been promoted does not spell a sunny immediate future for Sea. Although there’s no indication the company is about to fold, it does indicate that they’re buckling down for a gloomy 2023.
Sea have faced numerous issues, not just from their digital entertainment division Garena and the losses faced in their various mobile titles, but also in terms of ecommerce which is another area Sea specialises in. Garena’s Free Fire saw a relatively good year when taken in isolation, however as Sea points to, the global economic circumstances negated the potential positives. Free Fire also took some knocks, with the game being banned in India back in February due to its links to Chinese companies and tension between those two countries.
As 2023 begins, it remains to be seen what the future holds for Sea Ltd. However, after a difficult 2022, Tencent is predicted to bounce back. Whether Sea can do the same may hold the future of Garena and their mobile endeavours in the balance.