Sea Ltd (SE) 2017 Q4 法說會逐字稿

Good day, everyone, and welcome to the Sea Limited Fourth Quarter and Full Year 2017 Results Conference Call. (Operator Instructions) Please note that this event is being recorded.

大家好，歡迎參加 Sea Limited 2017 年第四季及全年業績電話會議。（操作說明）請注意，本次活動正在錄影。

I would now like to turn the conference over to Alan Hellawell, Group Chief Strategy Officer. Please go ahead.

現在我將把會議交給集團首席策略長艾倫·赫拉韋爾。請繼續。

Good morning, and good evening, everyone, and welcome to Sea's 2017 Fourth Quarter Earnings Conference Call. I am indeed Alan Hellawell, Sea's Group Chief Strategy Officer.

各位早安，各位晚上好，歡迎參加Sea公司2017年第四季財報電話會議。我的確是艾倫‧赫拉韋爾，Sea集團首席策略長。

Before we continue, I would like to remind you that we might be making forward-looking statements, which are inherently subject to risks and uncertainties and may not be realized in the future for various reasons as stated in our press release. Also, this call includes discussion of certain non-GAAP financial measures such as adjusted revenue, adjusted EBITDA and adjusted net loss. We believe these measures can enhance our investors' understanding of the actual cash flows of our major businesses when used as a complement to our GAAP disclosures.

在繼續之前，我想提醒各位，我們可能會做出一些前瞻性陳述，這些陳述本身存在風險和不確定性，並且由於我們在新聞稿中所述的各種原因，這些陳述未來可能無法實現。此外，本次電話會議也將討論一些非GAAP財務指標，例如調整後的收入、調整後的EBITDA和調整後的淨虧損。我們相信，這些措施可以作為我們 GAAP 揭露的補充，從而增強投資者對我們主要業務實際現金流的了解。

For a discussion of the use of non-GAAP financial measures and reconciliation with the closest GAAP measures, please refer to the section on non-GAAP financial measures in our press release.

有關非公認會計準則財務指標的使用以及與最接近的公認會計準則指標的調節的討論，請參閱我們新聞稿中關於非公認會計準則財務指標的部分。

Let me begin by introducing our management team on the call. We have our Chairman and group Chief Executive Officer, Forrest Li; our group President, Nick Nash; and our group Chief Financial Officer, Tony Hou. Forrest, Tony and myself will share strategy and business updates, operating highlights and financial performance for the fourth quarter of 2017. This will be followed by a Q&A session, in which we welcome any questions you have.

首先，請容許我介紹一下我們這次電話會議的管理團隊。我們的董事長兼集團執行長是李福瑞；集團總裁是尼克·納許；集團財務長是侯東尼。Forrest、Tony 和我將分享 2017 年第四季的策略和業務更新、營運亮點和財務表現。接下來將進行問答環節，歡迎大家提出任何問題。

With that, let's begin with Forrest for our key strategic highlights.

接下來，讓我們從福雷斯特開始，了解他的關鍵策略亮點。

Thanks, Alan. Thank you everyone for joining today's call. I'm very pleased to share that all 3 of our businesses saw robust expansion in the fourth quarter of 2017 on both the quarter-on-quarter and the year-on-year basis.

謝謝你，艾倫。感謝各位參加今天的電話會議。我非常高興地宣布，我們旗下所有三項業務在 2017 年第四季度均實現了強勁增長，無論是環比增長還是同比增長。

As you know, Garena is our most-established business and is our largest source of revenue and profit. I'm happy to share that it continued to grow strongly, delivering quarterly adjusted revenue of $141.9 million, up 59% year-on-year. Quarterly adjusted EBITDA more than doubled year-on-year to $52.6 million, showing very strong growth year-on-year.

如您所知，Garena 是我們最成熟的業務，也是我們最大的收入和利潤來源。我很高興地宣布，公司繼續保持強勁成長，季度調整後營收達到 1.419 億美元，年增 59%。季度調整後 EBITDA 年成長超過一倍，達到 5,260 萬美元，年成長非常強勁。

The launch of Free Fire, a mobile battle royale game, on 4 December 2017 on both the iOS App Store and Google Play Store was an important milestone for us. We developed Free Fire entirely in-house. I'm excited by the success it has had to date, both in the region and beyond.

2017 年 12 月 4 日，手機大逃殺遊戲《Free Fire》在 iOS App Store 和 Google Play Store 上線，對我們來說是一個重要的里程碑。Free Fire 完全由我們自主研發。我對它迄今為止在本地及其他地區的成功感到非常興奮。

Free Fire was planned and designed for a mobile gamer right from the start. Our development team focused on features such as short game lands, social elements and less-demanding hardware specs, which are more suitable for users in our region. We were also able to launch the game in many market quickly to capture a critical mass.

《Free Fire》從一開始就是為行動遊戲玩家規劃設計的。我們的開發團隊專注於遊戲地圖較短、社交元素和對硬體規格要求較低的功能，這些功能更適合我們地區的用戶。我們也能夠迅速在許多市場推出這款遊戲，從而獲得足夠的用戶量。

The journey has been exciting, and we are encouraged by the results. Free Fire has already achieved 6 million daily active users. As we have only started monetizing the game in January, it is still too early to gauge Free Fire's revenue potential, but we're actively exploring future channels of monetization. We will continue to step up our self-development capabilities to design games that meet the constantly evolving needs and the preferences of our gamers.

這段旅程令人興奮，我們也對所取得的成果感到鼓舞。《Free Fire》的日活躍用戶已達600萬。由於我們直到今年一月才開始對遊戲進行獲利，現在評估 Free Fire 的收入潛力還為時過早，但我們正在積極探索未來的獲利管道。我們將持續提升自主研發能力，設計出能夠滿足玩家不斷變化的需求和喜好的遊戲。

Meanwhile, we remain committed to building our partnership with top-class developers so that gamers in our region can enjoy a world-class game franchise. For example, we partnered with NetEase on the mobile RPG game Onmyoji. We launched it in Thailand last year and Vietnam just a few weeks ago.

同時，我們將繼續致力於與一流開發商建立合作關係，以便我們地區的玩家能夠享受到世界一流的遊戲系列。例如，我們與網易合作開發了手機角色扮演遊戲《陰陽師》。我們去年在泰國推出了這項服務，幾週前又在越南推出了。

Let's move on to e-commerce. We take a long-term view on Shopee, and growth is our top priority for the business. I'm pleased to share that e-commerce GMV reached $1.6 billion in the fourth quarter of 2017, an increase of more than 200% year-on-year and another record quarter for Shopee.

接下來我們來談談電子商務。我們對 Shopee 的發展持長期態度，業務成長是我們的首要任務。我很高興地宣布，2017 年第四季電子商務 GMV 達到 16 億美元，年成長超過 200%，Shopee 又創下了一個創紀錄的季度。

In line with our growth and monetization road map, we are investing strategically to support big brands as they establish flagship stores on our Shopee Mall. We are already working with leading brands such as L'Oréal, Xiaomi, Unilever and Watsons. These partners work with us largely because we can meet their demanding requirements such as fulfillment support and other value-added services. Shopee now leases warehouse in a number of our markets to meet the needs of our sellers. We will continue to evaluate additional services to support sellers as we grow our seller base.

為了配合我們的成長和獲利路線圖，我們正在進行策略性投資，以支持各大品牌在我們的 Shopee 商城開設旗艦店。我們已經與歐萊雅、小米、聯合利華和屈臣氏等領導品牌展開合作。這些合作夥伴與我們合作的主要原因是，我們可以滿足他們苛刻的要求，例如履行支援和其他增值服務。Shopee目前在多個市場租用倉庫，以滿足賣家的需求。隨著賣家群體的不斷擴大，我們將繼續評估其他服務以支援賣家。

I'm confident that we can expand monetization as we grow Shopee's market share. We're also planning to introduce new monetization tools as our relatively scale growth and when market dynamics make sense.

我相信，隨著 Shopee 市場佔有率的成長，我們也能擴大獲利模式。隨著公司規模的相對成長以及市場動態的變化，我們也計劃推出新的獲利工具。

In summary, I'm very proud of the growth that we have achieved in 2017. We look forward to another strong year of growth. Our region is one of the world's fastest-growing markets for digital entertainment, e-commerce and digital financial services. We're confident that we'll continue to build our leadership by constantly innovating to better the day-to-day lives of consumers and small businesses.

總而言之，我對我們在 2017 年所取得的成長感到非常自豪。我們期待又一個強勁成長的年份。我們所在的地區是全球數位娛樂、電子商務和數位金融服務成長最快的市場之一。我們有信心透過不斷創新，改善消費者和小企業主的日常生活，從而繼續鞏固我們的領先地位。

Before I hand the call over to Alan, I would like to thank you for your thoughtful suggestions over the past few months, particularly around how we present the business on an ongoing business basis. Our Group CFO, Tony Hou, will be updating you on how we have refined our segmental financial disclosure to better facilitate your understanding of our businesses and measure our progress. But first, over to Alan.

在將電話交給艾倫之前，我想感謝您在過去幾個月中提出的寶貴建議，特別是關於我們如何持續展示業務的建議。我們的集團財務長侯先生將向大家介紹我們如何改善分部財務揭露，以便更好地幫助大家了解我們的業務並衡量我們的進展。但首先，讓我們把麥克風交給艾倫。

Thank you, Forrest. I would like to build on Forrest's remarks with more detailed commentary and business updates.

謝謝你，福雷斯特。我想在福雷斯特的講話基礎上，提供更詳細的評論和最新的業務資訊。

Within digital entertainment, we continued to strengthen our market-leading role. Forrest has outlined it, adjusted revenue and adjusted EBITDA results. Quarterly active users, or QAUs, grew 74% year-on-year and 27% quarter-on-quarter to 87.8 million, largely driven by existing games such as Arena of Valor and the launch of Free Fire. Meanwhile, average revenue per user, or ARPU, came in at $1.60 compared to $1.80 for the fourth quarter 2016 and $2 for the third quarter of 2017. The easing in ARPU is mainly due to rapid user growth around our newly launched games, which resulted in faster QAU growth compared to quarterly paying users, or QPUs. We are pleased that QPUs increased to 7.2 million in the fourth quarter of 2017 from 6.5 million in the previous quarter. Looking ahead, we are excited about the pipeline of titles we have in store through the rest of 2018 and look forward to sharing details in due course.

在數位娛樂領域，我們繼續鞏固了市場領先地位。福雷斯特概述了調整後的收入和調整後的 EBITDA 結果。季度活躍用戶（QAU）年增 74%，季增 27%，達到 8,780 萬，主要得益於《王者榮耀》等現有遊戲以及《Free Fire》的推出。同時，每位用戶平均收入（ARPU）為 1.60 美元，而 2016 年第四季為 1.80 美元，2017 年第三季為 2 美元。ARPU 的下降主要是由於我們新推出的遊戲用戶數量快速成長，導致 QAU 的成長速度比季度付費用戶 (QPU) 的成長速度更快。我們很高興看到，2017 年第四季的合格購買單位 (QPU) 從上一季的 650 萬增加到 720 萬。展望未來，我們對 2018 年剩餘時間即將推出的遊戲陣容感到興奮，並期待在適當的時候分享詳情。

With regard to e-commerce, the markets in our region continue to grow strongly. Frost & Sullivan, for instance, just released its latest quarterly e-commerce report, estimating that 2017 GMV for Southeast Asia and Taiwan grew by 33% year-on-year to USD 31.8 billion. Shopee had an outstanding quarter with GMV reaching USD 1.6 billion, representing year-on-year growth of 206% and quarter-on-quarter growth of 48%. Shopee's gross orders reached $98.3 million, which represents an impressive growth of 244% year-on-year and 49% quarter-on-quarter, largely driven by the rapidly expanding Indonesian market.

就電子商務而言，我們地區的市場持續保持強勁成長。例如，弗若斯特沙利文公司剛發布了最新的季度電子商務報告，估計 2017 年東南亞和台灣地區的商品交易總額年增 33%，達到 318 億美元。Shopee 本季表現出色，GMV 達到 16 億美元，年成長 206%，季增 48%。Shopee 的總訂單金額達到 9,830 萬美元，年增 244%，較上季成長 49%，主要得益於印尼市場的快速擴張。

On a market-by-market basis, Indonesia experienced the strongest absolute growth in the fourth quarter. Even the more mature Taiwan market continues to display healthy growth rates in both GMV and gross orders. We also see our market share growing steadily in markets such as Thailand and Vietnam. Shopee's sharp growth trajectories underpinned by a heavy focus on long-tail product categories such as fashion and health and beauty, which serve the needs of our female customer base. Our marketplace approach maps particularly nicely the needs of those shoppers situated outside of capital city where we believe the fastest GMV growth is occurring. We continue to devote resources to make Shopee the mobile platform of choice for both sellers and buyers. Fostering user engagement is critical to us. A recent YouGov ranking of brand recognition in Indonesia put Shopee among the top 10 well-known brands, the only e-commerce brand along with other household names such as Garuda Indonesia and Toyota.

從各個市場來看，印尼在第四季度實現了最強勁的絕對成長。即使是較成熟的台灣市場，其商品交易總額和訂單總額也持續保持健康的成長率。我們也看到，我們在泰國和越南等市場的市場份額也在穩步增長。Shopee 的快速成長軌跡得益於其對時尚、健康和美容等長尾產品類別的重點關注，這些類別滿足了我們女性客戶群的需求。我們的市場策略尤其能夠很好地滿足首都以外地區消費者的需求，我們認為這些地區的GMV成長速度最快。我們將繼續投入資源，使 Shopee 成為賣家和買家首選的行動平台。提高用戶參與度對我們至關重要。YouGov 最近對印尼品牌認知度進行的排名顯示，Shopee 躋身十大知名品牌之列，是唯一一家與印尼鷹航和豐田等家喻戶曉的品牌一同上榜的電商企業。

In terms of our digital financial services, our GTV grew 311% year-on-year and 129% quarter-on-quarter to reach USD 1 billion in the fourth quarter of 2017, driven by closer integration with Shopee and expansion of use cases. We continue to focus our efforts on strengthening our infrastructure to support our existing platforms.

就我們的數位金融服務而言，在與 Shopee 更緊密的整合和應用場景的擴展的推動下，我們的 GTV 在 2017 年第四季度同比增長 311%，環比增長 129%，達到 10 億美元。我們將繼續集中精力加強基礎設施建設，以支援我們現有的平台。

With that, I will pass on to Tony to talk more about the financials.

接下來，我將把麥克風交給東尼，讓他繼續談談財務上的問題。

Thank you, Alan, and thanks to everyone for joining the call. First, let me highlight some positive changes in this quarter's release. On top of that segmental information we have disclosed in the previous quarters, we have started to disclose both EBITDA and adjusted EBITDA by segment this quarter to help you better understand our profitability.

謝謝你，艾倫，也謝謝所有參加電話會議的人。首先，我想重點介紹本季發布的一些積極變化。除了前幾季揭露的分部資訊外，本季我們也開始按分部揭露 EBITDA 和調整後 EBITDA，以幫助您更了解我們的獲利能力。

For our digital entertainment business, we have revised our estimation for certain games' revenue recognition periods by using average paying user life instead of game licensing period. The revision applies to one of our top titles, Arena of Valor. The impact of such changes was not significant. We believe that the revised estimations better reflect the economic essence of the respective games more accurately and result in higher-quality financial reports.

對於我們的數位娛樂業務，我們修改了某些遊戲收入確認期的估算，採用平均付費用戶生命週期而不是遊戲授權期。此次修訂適用於我們的一款熱門遊戲《王者榮耀》。這些變化的影響並不顯著。我們認為，修訂後的估算能夠更準確地反映各個比賽的經濟本質，並產生更高品質的財務報告。

We have included the detailed quarterly and annual financial schedules together with the corresponding management analysis in today's press release. So rather than then taking you through our disclosure line-by-line, I will focus my comments on some key financial metrics so that we have more time for Q&A later.

我們在今天的新聞稿中附上了詳細的季度和年度財務報表以及相應的管理分析。因此，與其逐條講解我們的揭露內容，我將重點放在一些關鍵的財務指標，以便我們稍後有更多時間進行問答環節。

For Sea overall, our fourth quarter total adjusted revenue was our highest ever at USD 164.5 million, an increase of 73% year-on-year and 8% quarter-on-quarter. This was primarily driven by the continued growth of our digital entertainment business and the initial monetization efforts of our e-commerce business.

就 Sea 整體而言，我們在第四季度調整後的總收入達到 1.645 億美元，創歷史新高，同比增長 73%，環比增長 8%。這主要得益於我們數位娛樂業務的持續成長以及我們電子商務業務的初步盈利努力。

Digital Entertainment adjusted revenue was USD 141.9 million, an increase of 59% year-on-year and 5% quarter-on-quarter, primarily due to the growth of our QAUs as we launched new games and expanded our existing games into new markets. Adjusted EBITDA was USD 52.6 million, an increase of 216% year-on-year and 17% quarter-on-quarter.

數位娛樂業務調整後收入為 1.419 億美元，年增 59%，環比增長 5%，主要得益於我們推出新遊戲並將現有遊戲擴展到新市場，從而帶動了用戶數量的增長。調整後 EBITDA 為 5,260 萬美元，年增 216%，季增 17%。

Our initial efforts to monetize Shopee platform are on track. E-commerce adjusted revenue was USD 9.3 million, up 62% quarter-on-quarter from the third quarter of 2017. We've also seen improvements in the efficiency of sales and marketing spend as the percentage of selling and marketing over GMV improved from 9.7% in the third quarter of 2017 to 8.5% in the fourth quarter of 2017. The percentage for the full year also improved from 11% in 2016 to 8.3% in 2017. Adjusted EBITDA loss widened to USD 175.4 million as we continued our investment to fully capture the market opportunity in the region. We will stick to our strategy to grow the platform and strengthen our market leadership position, especially in our focused categories. We expect this investment trend to continue in 2018 as both our GMV and gross orders continue to grow.

我們為實現 Shopee 平台盈利所做的初步努力進展順利。電子商務調整後營收為 930 萬美元，比 2017 年第三季季增 62%。我們也看到銷售和行銷支出的效率有所提高，銷售和行銷支出佔 GMV 的百分比從 2017 年第三季的 9.7% 提高到 2017 年第四季的 8.5%。2017 年全年百分比也從 2016 年的 11% 提高到 8.3%。由於我們繼續投資以充分掌握該地區的市場機遇，調整後的 EBITDA 虧損擴大至 1.754 億美元。我們將繼續執行既定策略，發展平台，鞏固市場領導地位，尤其是在我們重點關注的領域。我們預計這一投資趨勢將在 2018 年繼續，因為我們的 GMV 和總訂單量都將持續成長。

Digital financial services revenue, USD 4.1 million, up 140% year-on-year from $1.7 million in the fourth quarter of 2016. The increase was primarily attributable to the addition of use cases to our AirPay platform and the further deepening of our market penetration. Adjusted EBITDA loss was USD 7.6 million in the fourth quarter of 2017 compared to a loss of $9.2 million in the same period of 2016. We had a nonoperating loss of $62.3 million recognized in the fourth quarter of 2017. This was primarily due to a fair value loss of USD 52 million from the fair value accounting treatment for the convertible promissory notes and the interest expenses accrued on those same notes. We also had income tax expenses of $8.7 million in the fourth quarter of 2017 primarily due to the corporate income taxes and withholding tax expenses recognized for our digital entertainment business. As a combined result of all the above, our adjusted net loss, which is net loss adjusted to include share-based compensation expenses, was USD 251.6 million in the fourth quarter of 2017 as compared to USD 62 million for the same period 2016.

數位金融服務收入為 410 萬美元，較 2016 年第四季的 170 萬美元年增 140%。這一成長主要歸功於我們在 AirPay 平台上增加了更多用例，以及我們進一步加深了市場滲透。2017 年第四季調整後 EBITDA 虧損為 760 萬美元，而 2016 年同期虧損為 920 萬美元。2017 年第四季度，我們確認了 6,230 萬美元的非經營性虧損。這主要是由於可轉換本票的公允價值會計處理導致公允價值損失 5,200 萬美元，以及這些本票產生的利息費用。2017 年第四季度，我們的所得稅支出為 870 萬美元，這主要是由於我們數位娛樂業務確認的企業所得稅和預扣稅支出所致。綜合以上所有因素，我們 2017 年第四季的調整後淨虧損（即調整後的淨虧損，包括股份支付費用）為 2.516 億美元，而 2016 年同期為 6,200 萬美元。

I will conclude with our guidance for this year. We currently expect total adjusted revenue to be between USD 730 million to USD 770 million for the full year of 2018, representing year-on-year growth of 32% to 39%. For our e-commerce segment, we currently expect GMV to be between USD 7.5 billion to USD 8.0 billion for the full year of 2018, representing year-on-year growth of 82% to 95%.

最後，我將闡述我們今年的指導方針。我們目前預計 2018 年全年調整後總營收將在 7.3 億至 7.7 億美元之間，年增 32% 至 39%。對於我們的電子商務部門，我們目前預計 2018 年全年 GMV 將在 75 億美元至 80 億美元之間，年增 82% 至 95%。

Thank you, Tony. We'll now open up the call for questions.

謝謝你，托尼。現在開始接受提問。

(Operator Instructions) And our first questioner today will be MC Koh with Goldman Sachs.

（操作員說明）我們今天的第一位提問者是高盛的 MC Koh。

Congratulations on a good set of results. Couple of questions. Firstly, can you talk a bit about the PC versus mobile adjusted revenue mix? And secondly, in terms of pay ratio, it seems to have declined Q-o-Q. Is it part -- I know you talked a bit about it over the first few minutes, but if we can also get a bit more color by games. Is it just Free Fire? Or is it also sort of due to AOV now you're monetizing in certain markets?

恭喜你取得了不錯的成績。我有幾個問題。首先，您能否談談PC端與行動端調整後的營收組成？其次，就薪酬比率而言，似乎較上季有所下降。這是其中的一部分嗎？ ——我知道你在前幾分鐘談到了一些，但如果我們也能透過遊戲獲得更多細節就更好了。只有《Free Fire》嗎？或者，這也與你現在在某些市場進行獲利的平均訂單價值 (AOV) 有關？

Thanks. Thanks for the question. And talking about the PC and mobile, and we are pretty, like, excited about the growth opportunity of mobile. And so as you -- as we have like just reported, for Arena of Valor, we hit 10 million daily active users in the Q4 2017. At the same time, our self-developed game, Free fire, like also reached 6 million daily active users in our region and beyond our region as well. So this is a huge growth opportunity. I think we're going to continually try our best to capture such opportunities. And for your question on the PC side, and currently, we have several like big titles, right, like League of Legends and FIFA Online 3. And for -- like in looking at 2018, we do have several high expected like PC game to be launched as well. I think I'm not going to just comment specifically on any games in our future pipeline, but we remain very confident about the growth of both PC and mobile games in our region.

謝謝。謝謝你的提問。談到個人電腦和行動設備，我們對行動裝置的成長機會感到非常興奮。正如你們——正如我們剛才報導的那樣，《王者榮耀》在 2017 年第四季度達到了 1000 萬日活躍用戶。同時，我們自主開發的遊戲《Free Fire》在我們地區乃至其他地區也達到了600萬日活躍用戶。所以這是一個巨大的成長機會。我認為我們會繼續盡最大努力抓住這樣的機會。至於你問的PC端遊戲，目前我們有好幾款大作，像是《英雄聯盟》和《FIFA Online 3》。展望2018年，我們也有幾款備受期待的PC遊戲即將推出。我不打算具體評論我們未來開發計劃中的任何遊戲，但我們對我們地區 PC 遊戲和行動遊戲的成長仍然充滿信心。

Sorry, MC, you had a second question about conversion rate, is that correct?

抱歉，MC，您還有關於轉換率的第二個問題，對嗎？

That's correct, Alan. Yes.

沒錯，艾倫。是的。

Do you mind indulging us and repeating it one more time?

您能否滿足我們的願望，再重複一次？

Yes, so you did say that quarterly pay ratio declined a bit Q-o-Q, so just wondering if we can get a bit more color on why that's the case, perhaps if you could attribute it to specific games? I mean as far as you can disclose. Is it mainly because Free Fire came on and that sort of make the active users base increase a lot but not yet the paid users? Or is it also that AOV has not yet started monetizing in certain regions and that's why the ratio has fallen?

是的，您確實提到季度薪酬比率環比略有下降，所以我們想知道您能否更詳細地解釋一下原因，或許您可以將其歸因於具體的遊戲？我的意思是，在你能透露的範圍內。主要是因為《Free Fire》上線後，活躍用戶數量大幅增加，但付費用戶數卻沒有隨之增加嗎？或者，是因為某些地區的 AOV 尚未開始獲利，所以這個比例才下降了？

Okay. Yes. I think, actually, like -- yes, as you just like have mentioned, okay, so it is mainly due to the huge increase in terms of our user base of Free fire. And we launched the game just in December, but it's a takeoff -- it did take off very, very well. And -- but we only like start to monetize the game at the -- from the beginning of, like, this year; so starting in January. So in a way, also, like even in terms of the monetization, we still just go with a very moderate approach. So that's why you see a big surge in terms of our active user base so -- but now it's really like reflecting in the paying ratio. But if you look at our absolutely quarterly paying user number, it's increased a lot as well. So like from last quarter, Q3 from 6.5 million quarterly active users to 7.2 million quarterly active users in Q4. So even if you just look at the absolute like paying user base, we think we still see a very robust growth, yes.

好的。是的。我覺得，實際上，就像——是的，正如你剛才提到的，這主要是由於 Free Fire 用戶群的大幅增長。我們去年 12 月才發布了這款遊戲，但它一炮而紅——真的非常非常火爆。但是──我們只想從今年年初開始──也就是從一月開始，讓遊戲獲利。所以從某種意義上來說，即使在獲利方面，我們仍然採取非常溫和的方式。所以你會看到我們的活躍用戶數量大幅增長——但現在這確實反映在了付費用戶比例上。但如果你看一下我們每季的付費用戶數量，也會發現它大幅成長。所以，與上個季度（第三季）相比，第四季的季度活躍用戶數從 650 萬增加到 720 萬。所以即使只看付費用戶數量的絕對值，我們認為仍然可以看到非常強勁的成長，是的。

And our next questioner today will be Alicia Yap with Citigroup.

今天下一位提問者是花旗集團的Alicia Yap。

Forrest, Nick, Tony and Alan, congrats on the solid results. My first question is regarding your full year guidance. I understand Tony mentioned about some changes on the revenue recognition for some games in 4Q. And we noticed maybe the reported digital entertainment is actually slightly better. Would actually the change have any effect into 2018? And how should we translate your guidance of 32% to 39% to this Digital Entertainment GAAP revenue? And then is this -- the driver for digital entertainment, is that mainly driven by the gradual ramp of the monetization of Free Fire and also the AOV? Or is it also will be driven by some of the new games that in the pipeline you're going to be launch?

福雷斯特、尼克、東尼和艾倫，恭喜你們有優異成績。我的第一個問題是關於你們的全年指導。據我了解，Tony提到了第四季部分遊戲的收入確認方式有所改變。我們注意到，報道中的數位娛樂內容可能其實略好一些。這項改變真的會對2018年產生任何影響嗎？那麼，我們應該如何將您預測的 32% 至 39% 的成長轉化為數位娛樂 GAAP 收入呢？那麼，推動數位娛樂發展的動力，主要是 Free Fire 的貨幣化進程以及 AOV 的逐步提升嗎？或者，這也將受到你們即將推出的一些新遊戲的影響？

My second question is on the e-commerce; is that your GMV guidance seems very robust. Can you share with us in terms of the growth rate that you expect for the reported revenue and also expectations on monetization for the major country, such as Taiwan, Indonesia and maybe Thailand? Would you -- where would you expect the GMV growth mainly come from? And then on monetization, where do you expect the main pickup of the growth come from? Will that be the Shopee Mall commission rate or the performance-based advertising in certain market?

我的第二個問題是關於電子商務的；你們的GMV指導似乎非常可靠。您能否與我們分享您對報告收入成長率的預期，以及對主要國家（如台灣、印度尼西亞，或許還有泰國）的獲利預期？您認為GMV成長主要來自哪裡？那麼在獲利方面，您認為成長的主要動力來自哪裡？那是指 Shopee 商城的佣金率，還是某些市場的效果廣告佣金率？

Thanks, Alicia. So I will take the first question first. So for the guidance, we're talking about adjusted revenue, which is more on cash basis. So the change in the GAAP revenue accounting wouldn't affect the cash guidance per se. And for the driver of the growth, especially on the digital entertainment side, yes, it's a combination of the existing titles and also the new titles that are on the road. So we continuously focus on the user activeness and the user stickiness and -- while we provide better service to the users on our platform. So yes, so that's the answer to your first question.

謝謝你，艾莉西亞。那我先回答第一個問題。因此，對於業績指引，我們指的是調整後的收入，這更多是基於現金基礎的。因此，GAAP收入會計準則的改變本身不會影響現金流量指引。至於成長的驅動力，尤其是在數位娛樂方面，是的，是現有遊戲和即將推出的新遊戲的結合。因此，我們不斷關注用戶活躍度和用戶黏性，同時為平台上的用戶提供更好的服務。是的，這就是你第一個問題的答案。

And for the second question on the GMV guidance, well, it's a combination. So for our major markets like Indonesia and Taiwan, of course, we will continue driving our strong growth in the coming year. And beyond that, for the other markets like Thailand and Vietnam, we will also put our focus on it because we have seen good opportunity windows for us to fully capture the market potential. So Alan, you want to comment on that?

至於GMV指導的第二個問題，嗯，這是一個綜合問題。因此，對於我們在印尼和台灣等主要市場，我們當然會在未來一年繼續保持強勁成長。除此之外，對於泰國和越南等其他市場，我們也將重點關注，因為我們看到了充分掌握市場潛力的良好機會。艾倫，你對此有什麼看法？

Yes. Maybe I'll add a little there. Alicia, you made reference to Shopee Mall, which is the branded part of our marketplace, and we're indeed very excited about that. We, in many markets, now look to Shopee Mall for more than 10% of our GMV. And in Taiwan, where we've implemented a universal commission schedule, we have a 5% take-rate there. So to the extent that Shopee Mall significantly outstrips Shopee in terms of growth, all things being equal, we're going to see a nice bias or an improvement in the take-rate there.

是的。或許我會在那裡補充一點。Alicia，你提到了 Shopee Mall，那是我們市場上的品牌部分，我們對此確實感到非常興奮。在許多市場，我們現在超過 10% 的 GMV 來自 Shopee Mall。在台灣，我們實行了統一的佣金制度，佣金率為 5%。因此，如果 Shopee Mall 在成長方面顯著超過 Shopee，那麼在其他條件相同的情況下，我們將會看到 Shopee Mall 的佣金率出現明顯的上升或提升。

With regard to performance-based advertising, we don't give particularly specific guidance there. We will just say we've implemented the ad tools across almost all of our markets. The uptake has been very encouraging. And we do feel that, that will become an important component of monetization in the same way some of our predecessors in the region have very, very successfully used ad tools to instill a little more order to these marketplaces. So we're also very enthusiastic about that.

關於效果廣告，我們沒有給予特別具體的指導。我們只能說，我們已經在幾乎所有市場都部署了廣告工具。市場反應非常令人鼓舞。我們確實認為，這將成為盈利的重要組成部分，就像該地區的一些前輩非常成功地利用廣告工具為這些市場帶來更多秩序一樣。所以我們對此也充滿熱情。

And our next questioner today will be Mike Olson with Piper Jaffray.

今天下一位提問者是來自 Piper Jaffray 的 Mike Olson。

So I just have 2. At this point, it sounds like Free Fire is relatively immaterial to Garena revenue as you kind of work to monetize the growing user base, but I guess, please let me know if that's not correct. But what I was wondering is, is there a typical time frame over which you find that you can successfully monetize a new title? Like, should we begin to see Free Fire becoming more material in Q2?

所以我只有2個。目前看來，Free Fire對Garena的營收影響不大，因為你們主要致力於透過不斷成長的用戶群來獲利，但我想，如果我的理解有誤，請告訴我。但我好奇的是，通常情況下，一款新遊戲需要多長時間才能成功獲利？我們是否應該在第二季看到《Free Fire》變得更重要？

Or would it be more in the second half of the year? And then for Shopee, I guess, kind of just a follow-up from that last question. In the script, you mentioned some additional ways to monetize and drive higher overall take-rate, and you just talked about Shopee Mall and seller commissions and advertising. Is there more? Or are there more monetization tools beyond that, that we're not thinking about or that haven't been discussed on the call?

或更可能在下半年？至於 Shopee，我想這是對上一個問題的後續。在劇本中，你提到了一些其他的獲利方式，以及提高整體分成率的方法，你剛才還談到了 Shopee Mall、賣家佣金和廣告。還有嗎？或者，除了這些之外，是否還有其他我們沒有想到或在電話會議上沒有討論過的盈利工具？

Okay. Thank you for the question. Let me answer this. I think like for the first question, specifically on Free Fire, so since we launched the game, it grew very, very well. And we see the enthusiasm like on the game across actually from all over the world across a lot of like our existing -- like existing market and new market, the gamers are very enthusiastic about the game and they're very active in the community. So they have been giving us a lot of like suggestions and in terms of the new features of the game and how the direction of the game should be. So like to be very honest, like, our entire, like, development team at this moment is -- they're working day and night even like during the Chinese New Year, so they work pretty hard to fulfill the expectation of the gamers from the product features, from continually enhance the graphic quality of the game, right?

好的。謝謝你的提問。讓我來回答這個問題。我認為就像第一個問題，特別是關於《Free Fire》這款遊戲，自從我們推出這款遊戲以來，它的發展非常非常順利。我們看到，來自世界各地，包括我們現有的市場和新市場，玩家們對這款遊戲都充滿熱情，並且在社群中非常活躍。所以他們給了我們很多建議，包括遊戲的新功能以及遊戲的發展方向。說實話，我們整個開發團隊目前都在日夜不停地工作，甚至在春節期間也是如此。他們非常努力地工作，以滿足玩家對產品功能的期望，並不斷提高遊戲的畫面質量，對吧？

So to be honest, at this moment, even just to look at our, like our own focus, we will rather to just continually make the game itself to make it more like a premium game and continue to make it more attractive to gamers. And we still see the growth of the user base is very fast, and we're really excited about it. And we want to capture this opportunity and to try to build up the user base as big as possible.

所以坦白說，目前，即使只看我們自己的關注點，我們也寧願不斷地改進遊戲本身，使其更像一款優質遊戲，並繼續使其對玩家更具吸引力。我們仍然看到用戶群成長非常迅速，我們對此感到非常興奮。我們希望抓住這個機會，並努力擴大使用者群體。

So at this moment, we start to explore like all the different type of the monetizations of the game. But in terms of, like, when we start to really focus on monetization, I will say it could be in the next quarter and it could be in 6 months. I don't have a really specific answer. It really depends on how the user base grows and how the response of the gamer community.

所以現在，我們開始探索遊戲中所有不同類型的獲利模式。但就我們何時真正開始關注盈利而言，我認為可能是在下一個季度，也可能是6個月後。我沒有一個非常具體的答案。這主要取決於用戶群體的成長以及遊戲玩家社群的反應。

But in general, I'm very confident. I seldom see a game with -- very popular with a huge user base, like user base but have no -- have a very kind of like disappointing way to monetize the game. And usually it's not the case. I think like, still, for most of the games, the user base is critical. As long as you have very loyal gamers to play the game, and there is also a way to figure out the monetizations later. So at that part, I'm pretty confident. I will keep updating you in terms of our monetization progress of Free Fire moving forward.

但總的來說，我非常有信心。我很少見到一款遊戲——擁有龐大的用戶群，非常受歡迎，但卻沒有——一種非常令人失望的遊戲獲利方式。但通常情況下並非如此。我認為，對於大多數遊戲來說，使用者群體仍然至關重要。只要有非常忠實的玩家群來玩這款遊戲，以後再想辦法實現獲利也不遲。所以在這方面，我相當有信心。接下來，我會持續向大家報告Free Fire的獲利進度。

And in terms of your second question on Shopee, and at this moment, like, still, I think we took a pretty long-term view. And we don't -- we're not very excited just to say, okay, the immediate monetization like -- or like in terms like a very -- like, okay, so next 6 months or like the next 6 months like what is the -- what is our monetization? We are not focusing on that. And we see this tremendous growth opportunity of e-commerce in our region and we want to capture as much as possible the market share at this moment. But we have also seen clearer the monetization path, and I think from some pioneers of the industry and also see what the best practice is from other regions, right, specifically the performance-based advertising, right, and also the commissions.

至於你關於 Shopee 的第二個問題，目前來看，我們仍然採取了相當長遠的視角。我們並不——我們不太興奮地直接說，好吧，立即實現盈利，或者說，比如，好吧，那麼接下來的6個月，或者說接下來的6個月，我們的盈利模式是什麼？我們並沒有把重點放在那上面。我們看到了本地區電子商務的巨大成長機遇，我們希望在這個階段盡可能地佔據市場份額。但我們也更清楚地看到了盈利模式，我認為從一些行業先驅那裡，我們也看到了其他地區的最佳實踐，特別是基於效果的廣告，以及佣金。

I think there is one area we see there's a huge potential for us for the additional monetization is some value-added services. And as our platform grow very fast and the sellers on Shopee, they are growing very fast as well; so recently, I visit just a seller in Indonesia, at the beginning of 2017, every day they only have like about 100 daily orders. And now they have like 1,500 daily orders. So the growth to them is tremendous. So because of this growth, they also need a lot of value-added services such as they start to need to hire people like to help them manage the processing of orders. They need to have a setup -- start to have -- set up a small warehouse instead of just put everything in their house, right? And so all those areas, I think there is a tremendous opportunity to monetize to meet the sellers' demand as they also grow their scale. So this is a potential -- like a particular area where we're also looking at and still there's a huge opportunity there.

我認為，在某些增值服務領域，我們看到了巨大的獲利潛力。隨著我們的平台發展迅速，Shopee 上的賣家也發展迅速；最近，我拜訪了一位印尼的賣家，在 2017 年初，他們每天只有大約 100 個訂單。現在他們每天大約有1500個訂單。因此，他們的成長是巨大的。因此，由於這種增長，他們也需要很多增值服務，例如他們開始需要雇用人員來幫助他們管理訂單處理。他們需要建立一個倉庫，而不是把所有東西都放在家裡，對吧？因此，我認為所有這些領域都蘊藏著巨大的獲利機會，可以滿足賣家的需求，同時擴大他們的規模。所以這是一個潛在的領域——就像我們正在關注的一個特定領域，那裡仍然蘊藏著巨大的機會。

And the next questioner today will be Scott Devitt with Stifel.

今天的下一位提問者是來自 Stifel 的 Scott Devitt。

I did have 2. The first one is on Shopee. And just in listening to JD's management team talk about their interest and efforts in the region as well given the sponsorship the companies share, just interested in terms of how you think about the complementary nature of Shopee relative to JD and the ability to potentially work together in the region. Or is it just too early in the development of the markets to begin to think about something like that?

我確實有兩個。第一個是在 Shopee 買的。聽聽京東管理團隊談及他們對該地區的興趣和努力，以及兩家公司共同的贊助，我很想知道您如何看待 Shopee 與京東的互補性，以及雙方在該地區潛在的合作能力。或者說，現在市場發展還處於早期階段，考慮這類事情還為時過早？

And then secondly, it would be great if one of you wouldn't mind just adding a little bit more color on Nick's retirement and kind of the dynamics in terms of how responsibilities are going to be inherited upon his departure, and maybe why not stay on the board when he leaves the company?

其次，如果你們當中有人不介意的話，能否再詳細說說尼克的退休以及他離開後各部門的職責將如何交接，或許還可以談談他離開公司後為什麼不繼續留在董事會？

Sure thing. This is Alan. I'll take your e-commerce question or JV-related question. We benefit from a very cordial relationship with Richard Liu and his team at JD. I would say to your question, I think that they're still in an exploratory phase. We know that they've made some investments in markets such as Indonesia, Thailand. They're doing some stuff in Vietnam. We communicate with them regularly.

當然可以。這是艾倫。我會回答你關於電子商務或合資企業方面的問題。我們與京東的劉強東及其團隊保持著非常友好的關係，並從中受益匪淺。對於你的問題，我認為他們仍處於探索階段。我們知道他們在印尼、泰國等市場進行了一些投資。他們在越南搞一些活動。我們定期與他們溝通。

However, I think we're both exceptionally busy trying to determine how we deliver our value proposition to each of these markets. But we fully intend to continue our dialogue with them, and we'll see where that goes. With regard to your question about Nick and his retirement, I think if you don't mind, we'll save that to right after the FAQ wraps up, and hopefully, we'll gain some comments from both Forrest and Nick on that.

不過，我認為我們兩個都非常忙，都在努力確定如何向每個市場提供我們的價值主張。但我們完全打算繼續與他們對話，看看對話會如何發展。關於你提出的尼克及其退休的問題，如果你不介意的話，我們不妨在常見問題解答結束後再討論，希望屆時福雷斯特和尼克都能對此發表一些評論。

And the next questioner today will be John Blackledge with Cowen.

今天的下一位提問者是來自考恩公司的約翰·布萊克利奇。

Two questions. So the GMV results were stronger than we expected, driven by kind of bigger upside in gross orders versus what we had estimated. Just wondering if you can provide some insight into the drivers of the strong gross order growth? In that regard, it looked like Taiwan's growth on a Q-over-Q basis was a bit slower than the other markets. Just any call out there. And then just the last question, if you can just give some color on Shopee's logistics and delivery speed relative to competitors in some of the larger markets, that would be helpful.

兩個問題。因此，GMV 的結果比我們預期的要好，這主要是由於總訂單量比我們估計的要高。我想請問您能否分析一下推動訂單總額強勁成長的因素？從這個角度來看，台灣的季度環比成長速度似乎比其他市場略慢。隨便哪個電話都行。最後一個問題，如果您能簡要介紹一下 Shopee 在一些較大市場中相對於競爭對手的物流和配送速度，那就太好了。

Sure. Yes, I mean, again, in sum, we were extremely pleased with the fourth quarter performance, frankly, across all of our markets. We, I would say, are still in kind of discovering the relevance of the marketplace model in a lot of our markets. And so I believe that, that value proposition has just been taken up much more readily than we would've anticipated. There are elements of what you might call a network effect. The more stores that we bring online and the, in turn, greater number of customers that they bring pre-existing from their social sites or a new Fire, a level of growth, and to your question, order intensity that constantly surprise us. You mentioned Taiwan. I mean, it is ultimately, by so many different angles, kind of our most matured market. But even having said that, I think the year-on-year growth and the quarter-on-quarter growth are significantly in excess of what we understand to be the underlying market growth rate. So we're actually very pleased with that. And forgive me, can you repeat your second question?

當然。是的，我的意思是，總而言之，坦白說，我們對第四季度在所有市場的業績都非常滿意。我認為，我們仍在探索市場模式在我們許多市場中的相關性。因此，我認為，這個價值主張比我們預期的更容易被接受。這其中存在一些你可以稱之為網路效應的因素。我們上線的店鋪越多，他們從社交媒體或新開的 Fire 設備帶來的客戶數量就越多，增長水平就越高，而您提到的訂單強度也總是讓我們感到驚訝。你提到了台灣。我的意思是，從許多不同的角度來看，它最終是我們最成熟的市場之一。但即便如此，我認為年比和季比成長率都顯著高於我們所理解的潛在市場成長率。所以我們對此非常滿意。請問您能再說一次您的第二個問題嗎？

Yes, sure. So just talk about Shopee's logistics and delivery speed relative to competitors in some of the bigger markets in Indonesia and Taiwan, et cetera, and in relationships with the 3PLs.

當然可以。所以，請談談 Shopee 在印尼和台灣等一些較大市場與競爭對手相比的物流和配送速度，以及它與第三方物流公司的關係。

Sure. So a couple of items there. First of all, just back to that keyword, network effect. By having a number of merchants which we measure in the millions and then in an individual market such as Indonesia, a number that's already exceeded 1 million, we basically, statistically speaking, are likely to have a merchant and some kind of approximate area to -- someone placing an order. And so we've seen this in other markets around Asia, the marketplace player ending up not being particularly efficient in terms of average delivery time because of that principle. Our understanding, having looked at third-party research, is we tend to deliver in a market like Indonesia within 2 days. And we believe that is the fastest pace of delivery in the market. In markets such as Taiwan, which obviously probably have better infrastructure and are smaller geographically, it's even less than that.

當然。所以這裡有兩樣東西。首先，讓我們回到關鍵字「網路效應」。我們擁有數百萬的商家，而在像印尼這樣的單一市場，商家數量已經超過 100 萬，從統計學角度來看，我們基本上可以確定，在某個商家和某個大致區域內，就會有人下單。因此，我們在亞洲其他市場也看到了這種情況，由於這項原則，市場參與者在平均交付時間方面最終效率並不高。根據第三方研究，我們了解到，在像印尼這樣的市場，我們通常可以在 2 天內完成交付。我們相信這是市場上最快的交付速度。在台灣等市場，由於基礎建設明顯較好、地理面積較小，實際比例甚至更低。

But Chris Feng and his team at Shopee, to his great credit, from day one put huge emphasis on the technological aspects of rolling out an e-commerce platform. And that really included from day one an attempt to back-end integrate with the leading 3PLs. This is something he's been able to achieve across all 7 of our markets. And so I think -- I don't have any updated numbers in terms of delivery time or other kind of quantitative elements, but our understanding is by working with these guys on a daily basis, we're helping them help us in many ways not just to improve the experience and delivery times, but more for longer-term planning purposes identifying hotspots of emerging demand and across one or several of Indonesia's 34 provinces and enabling them to grow their delivery center capacity, their last-mile headcount to anticipate and preempt that. So our general efforts are designed at consistently improving the logistics experience.

但值得稱讚的是，Chris Feng 和他的 Shopee 團隊從一開始就非常重視電子商務平台的技術面。從一開始，我們就嘗試與領先的第三方物流公司進行後端整合。這是他在我們所有7個市場都取得的成就。所以我覺得——我沒有關於交付時間或其他量化要素的最新數據，但我們的理解是，透過每天與這些人合作，我們不僅在改善體驗和交付時間方面，而且在更長遠的規劃方面，幫助他們識別新興需求的熱點地區，涵蓋印尼的34個省份中的一個或多個，並使他們能夠擴大其交付中心的容量和最後一公里的人員配備，以預測和先發製人。因此，我們整體的目標是不斷改善物流體驗。

And our next questioner will be Andrew Orchard with Nomura.

接下來，我們將邀請野村證券的安德魯·奧查德進行提問。

Guys, a couple of questions on Shopee as well. Firstly, on the sales and marketing spend for e-commerce, can you walk us through the Q-on-Q decline in terms of sales and marketing spend as a percent of GMV? How did you manage to -- how did you manage to dial that back a little bit? And what are you looking for in terms of sales and marketing in the next quarter and next year going forward?

各位，關於Shopee還有幾個問題。首先，關於電子商務的銷售和行銷支出，您能否為我們分析一下銷售和行銷支出佔 GMV 的百分比，以及季減的情況？你是如何——你是如何設法稍微收斂一些的？那麼，在接下來的一個季度以及明年，您在銷售和行銷方面有什麼目標？

And also, you talked about the leasing of warehouses for Shopee Mall, how do you expect this to evolve going forward? And in terms of future expenses in terms of rental, where are you expecting this to hit towards eventually as a percent of revenue, a percent of GMV? And where would you book these costs?

另外，您也談到了 Shopee Mall 的倉庫租賃問題，您認為未來這一領域將如何發展？至於未來的租金支出，您預計最終會佔收入或GMV的百分比是多少？這些費用您會在哪裡預訂？

Sure. This is Alan. I'll take your questions. So you're referring to sales and marketing as a percentage of GMV having declined to 8.5% in the fourth quarter of last year versus 9.7% in the third quarter. I mean descending from 50,000 feet, we're clearly, with every passing day that we grow magnitudes faster than many of our markets, we're moreover enjoying a level of operating leverage that others who may not be growing as fast don't have access to. That said, we all are -- we're also singularly focused on investing as efficiently as possible in growing that GMV.

當然。這是艾倫。我來回答你們的問題。所以你的意思是，銷售和行銷費用佔 GMV 的百分比從去年第三季的 9.7% 下降到去年第四季的 8.5%。我的意思是，從 50,000 英尺的高空俯瞰，我們顯然每天都在以遠超許多市場的速度增長，而且我們還享受其他增長速度可能不如我們的公司所擁有的運營槓桿水平。也就是說，我們所有人都在努力——我們也一心專注於盡可能高效地投資，以提高 GMV。

And as we look into 2018, we are very focused similarly on continuously driving down S&M as a percentage of GMV. That said, we -- as one of your peers pointed out earlier in the call, we're targeting a level of GMV growth which remains -- represents very strong growth. Whereas S&M as a percentage of GMV, we're very hopeful will continue to go down. Obviously, in absolute terms, it will grow relatively robustly. I'm not sure if I've answered your question, Andrew.

展望 2018 年，我們同樣非常注重持續降低銷售和行銷費用佔商品交易總額的比例。也就是說，正如你們的一位同行在電話會議早些時候指出的那樣，我們的目標是實現 GMV 成長，而這一目標仍然代表著非常強勁的成長。而銷售和行銷費用佔商品交易總額的比例，我們非常希望能夠繼續下降。顯然，從絕對值來看，它將相對強勁成長。安德魯，我不確定我是否回答了你的問題。

Yes, I think that's good.

是的，我覺得這樣很好。

With regard to some -- your second question, just maybe a couple of comments on why we're doing what we're doing, or even before that, the scale of what we're doing. It's actually very, very limited. And the genesis of some of these ancillary services owes to a lot of the larger brands that we've begun to court, and Forrest mentioned several of them in his prepared remarks. These brands generally have very high standards and expectations in their partners. And so we may decide, here, to help co-locate some inventory for 1 vendor. We may, there, offer what you might call supply chain management services. The scale of these efforts is still from a P&L perspective de minimis.

關於你的第二個問題，或許可以簡單談談我們為什麼要做我們正在做的事情，或者更確切地說，我們正在做的事情的規模。實際上，它的功能非常非常有限。這些輔助服務的起源要歸功於我們開始積極爭取合作的許多大品牌，福雷斯特在他的準備好的演講稿中提到了其中幾個品牌。這些品牌通常對合作夥伴有著非常高的標準和期望。因此，我們可能會決定，幫助一家供應商將部分庫存集中存放。我們可能會在那裡提供您所謂的供應鏈管理服務。從損益表的角度來看，這些努力的規模仍然微不足道。

It's early days, and we believe that we won the allegiance of a lot of these leading brands through our willingness to accommodate them. We don't have a sense that their demands will grow inordinately nor will the investments devoted to that balloon. But we'll keep you apprised. But right now, it's really -- it ends up bringing a lot of these brands over the try line. And with that comment, I also emphasize that so many of these brands are looking for a one-stop shops in affiliating with e-commerce platforms in Southeast Asia, and we feel we're one of the very limited number of options that they can go to. And we're really starting to see that advantage blossom with a growing list of multinational leading consumer brands.

現在還處於初期階段，我們相信，我們透過願意滿足這些領先品牌的需求，贏得了它們的忠誠。我們並不認為他們的要求會無節制地成長，投入這方面的投資也不會呈現爆炸性成長。但我們會隨時向您通報最新情況。但現在的情況是——它最終導致許多品牌都失敗了。此外，我還想強調，很多品牌都在尋找與東南亞電商平台合作的一站式服務，而我們覺得自己是他們少數的選擇之一。我們確實開始看到，越來越多跨國領先的消費品牌正在展現出這種優勢。

And our next questioner today will be MC Koh with Goldman Sachs.

今天下一位提問者是高盛的 MC Koh。

A couple more questions from me. Firstly is the -- in terms of the e-commerce revenue increase. It seems like it's mainly coming from Shopee Mall. Can we understand whether the Shopee Mall take-rate is the same across all countries or not? And the second question is as you mentioned before, Shopee Mall is about 10% of GMV or so. Can you give us a sense of what, how big this -- the contribution could be in a more mature state?

我還有幾個問題。首先是－就電子商務收入成長而言。看起來主要來自Shopee Mall。我們能否了解 Shopee Mall 在所有國家的佣金率是否相同？第二個問題正如您之前提到的，Shopee Mall 的銷售額約佔 GMV 的 10% 左右。您能否讓我們了解一下，如果這個計畫發展得更成熟，它的貢獻會有多大？

Yes. So with regard to the Shopee Mall take-rates, just to be very clear, at this point in time, it's only being assessed in Taiwan. So that specific 5% take-rate is exclusive to Taiwan. We have 3 categories of take-rates, MC, as you will recollect. We have Shopee Mall, we've got cross-border and then we have the traditional Shopee C2C commission schedule. So the first 2 are now 5%.

是的。所以關於 Shopee Mall 的佣金率，需要非常明確地說明的是，目前只在台灣進行評估。所以，這5%的特定抽成率只適用於台灣。MC，您應該還記得，我們​​有 3 類佣金率。我們有 Shopee 商城，我們有跨境交易，還有傳統的 Shopee C2C 佣金制度。所以前兩項現在佔 5%。

Cross-border, for some period of time, was 3%, and we've upped that to 5%. And we do charge that across a number of our markets. The very nice thing, just to pick up one of my responses earlier, is that both Shopee Mall and cross-border GMV growth rates are significantly in excess of the underlying Shopee C2C growth rate. So again, just as a commission-specific comment, we would expect the blended commission rate to continue to grow with time. And again, MC, forgive me, your second question was?

跨境交易比例在一段時間內為 3%，我們已將其提高到 5%。我們在很多市場都收取這項費用。正如我之前提到的，令人欣喜的是，Shopee Mall 和跨境 GMV 的成長率都顯著高於 Shopee C2C 本身的成長率。所以，就佣金而言，我們預期綜合佣金率會隨著時間的推移而持續成長。還有，主持人，請原諒我，您的第二個問題是？

Yes. So you mentioned that Shopee Mall is about 10% GMV, just wondering like in a more mature state, would it be like 20%, 30% you think?

是的。你提到 Shopee Mall 的 GMV 佔比約為 10%，我想知道，如果發展得更成熟，你認為會達到 20% 或 30% 嗎？

I think we're generally a bit reluctant to provide that kind of guidance. I mean, we look around the region, we see a lot of our peers with a nearly 50-50 mix between the traditional C2C and the brand-oriented platforms. That is part of our framework as we think about things longer term. And I would also just once again say that the growth trajectory is such that we already have some markets which are probably closer to 15% of GMV coming from Shopee Mall. So I would think that the discussion does merit thinking about higher levels of mix going forward.

我認為我們通常不太願意提供這類指導。我的意思是，我們環顧四周，發現許多同行在傳統的 C2C 平台和品牌導向平台之間幾乎各佔一半。這是我們考慮長遠問題時所依據的框架的一部分。我還要再次強調，目前的成長趨勢表明，我們已經有一些市場中，Shopee Mall 的 GMV 佔比可能接近 15%。所以我認為，這場討論確實值得我們思考未來更高層次的混合方式。

And the next questioner today will be Varun Ahuja with Crédit Suisse.

今天的下一位提問者是來自瑞士信貸的Varun Ahuja。

I've got 3 questions. On e-commerce, firstly, I just want to go back to the warehouse thing. I know you mentioned just initial specific reinvestments that you're making. But given Taiwan, or this is more specific to Taiwan particularly because both PChome and Momo does a lot of warehouse costing. And if you're looking to compete aggressively in that market, do you think this component is going to increase meaningfully for Taiwan or it's still pretty early days? Are you still watching it? And given you're trying to grow Shopee Mall, will you try to do warehouse in other markets besides Taiwan? That's number one.

我有三個問題。關於電子商務，首先，我只想回到倉儲模式。我知道你只提到了你正在進行的一些初步的特定再投資。但考慮到台灣的情況，或者更具體地說，考慮到台灣的情況，因為 PChome 和 Momo 都進行了大量的倉儲成本核算。如果你想在這個市場展開激烈的競爭，你認為台灣的這一部分會顯著成長嗎？還是現在還為時過早？你還在追這部劇嗎？鑑於您正在努力發展 Shopee Mall，您是否會嘗試在台灣以外的其他市場建立倉庫？這是第一點。

Secondly, on e-commerce. Can you give some color on the kind of EBITDA losses that we may look at in 2018 given the aggressive approach on the GMV front? I know you mentioned that sales and marketing as an absolute amount will grow, but any figure on that, that you have in terms of the EBITDA losses? Thirdly, on gaming side, given the strong reply to the own game, how should we look the own game going forward? Is there any particular genre that you're looking to target in next couple of years? Is there any mix target in terms of revenue from own game versus leasing? That would be helpful.

其次，關於電子商務。鑑於我們在GMV方面採取的積極策略，您能否詳細說明一下我們在2018年可能會面臨的EBITDA虧損情況？我知道您提到銷售和行銷的絕對金額將會成長，但是您能否提供一些關於 EBITDA 虧損的具體數據？第三，在遊戲方面，鑑於玩家對自家遊戲的強烈反響，我們該如何看待自家遊戲未來的發展？未來幾年，你們有沒有特別想重點發展的特定類型？在自有遊戲收入和租賃收入方面，是否有任何組合目標？那會很有幫助。

Okay. Thanks for the question. And for the first question about the fulfillment about the warehouse, I think like this is aligned with like what we see the value proposition of Shopee even from the day we started this as a platform. I think like at the beginning, like 2, 3 years ago, I started Shopee because we realize there's a huge opportunity to resolving the pain point of a lot of sellers on social platform and I want to, like, do the business through the mobile platform. So back then, there's no such great platform to fulfill the need of the sellers effectively focused on like social and mobile. So that's how we got Shopee started.

好的。謝謝你的提問。至於關於倉庫履行方面的第一個問題，我認為這與我們從 Shopee 平台創立之初就秉持的價值主張是一致的。我覺得大概在兩三年前，我創辦 Shopee 的初衷是，我們意識到社交平台上有很多賣家面臨痛點，而解決這些痛點蘊藏著巨大的機會，我想透過行動平台開展業務。所以當時還沒有像現在這樣優秀的平台能夠有效地滿足賣家在社群和行動端的需求。這就是Shopee的由來。

I think as I just mentioned when I answered an earlier question, so like when the whole platform grows and our seller base is growing at a very fast rate as well, and we see there's a tremendous, like, increasing need for sellers, especially the smaller -- smaller sellers, when they grow their business, they need a lot of support and to do a business better. I think this is to help them on those needs. It's highly aligned with our interest because at the end of the day, if all the sellers on our platform grow very well and the whole platform, Shopee platform will grow very well. So we continually communicate with the sellers, identify their needs.

就像我剛才回答之前的問題時提到的那樣，隨著整個平台的發展，我們的賣家群體也在快速增長，我們看到對賣家，尤其是小型賣家的需求正在急劇增加——小型賣家在發展業務時，需要大量的支持才能更好地開展業務。我認為這樣做是為了幫助他們滿足這些需求。這與我們自身的利益高度契合，因為歸根結底，如果我們平台上的所有賣家都發展得很好，那麼整個平台，也就是 Shopee 平台，也會發展得很好。因此，我們會不斷與賣家溝通，並了解他們的需求。

But at the same time, like, we'll see -- so we will think about what is the priority, what is the most demanding requirement at this moment. And now we will say like we think our capability like at a certain extent, we're going to help them. I think like this is a -- warehousing is one of them. And they do -- as I mentioned, a lot of sellers initially they started from their house. They put everything in their house. But like moving forward, they do need a warehouse and also they need to increase the efficiency of their delivery.

但同時，我們會看看情況——我們會考慮當前的首要任務是什麼，目前最迫切的需求是什麼。現在我們會說，我們認為我們有能力在一定程度上幫助他們。我認為這就像是——倉儲就是其中之一。而且他們確實如此——正如我所提到的，許多賣家最初都是從家裡開始的。他們把所有東西都搬進家裡了。但就像向前發展一樣，他們確實需要一個倉庫，而且他們還需要提高配送效率。

So that's the angle when we look at this space. But at the same time, we're very cautious on the -- in terms of the investment, in terms of the spending. So at this moment, it's still very, very small. And it's much -- like most of the -- like almost all -- I think all the warehouse like we have is by leasing, right, and so we're not going to put tremendous capital commitment on that part. I think I would leave Alan to answer your second question, and I would jump into the third question first. And regarding your -- like our prospect in terms of like our game pipeline, definitely, I think like game development, self-development capabilities is very, very critical for us. And so we have that ambition to be like a world-class, like premium, like a game developer rather than just being a game operator. So that's the thing, like this effort has been started like 4 years ago.

所以，這就是我們看待這個空間的角度。但同時，我們在投資和支出方面都非常謹慎。所以目前來說，它仍然非常非常小。而且，就像大多數倉庫一樣，幾乎全部倉庫都是租來的，所以我們不會在這方面投入巨額資金。我認為應該讓艾倫來回答你的第二個問題，而我則先回答第三個問題。至於你提到的——例如我們遊戲開發方面的前景，我認為，就遊戲開發而言，自我開發能力對我們來說非常非常關鍵。因此，我們的目標是成為世界一流的、高端的遊戲開發商，而不僅僅是遊戲營運商。事情是這樣的，這項工作大概在4年前就開始了。

Like in 2013, and we start with set up the studios in Shanghai. But today, we have like about 200 top-tier game designers in that studio. And the Free Fire is just a good example, I think it'll take time to reach today's level. So we can develop the game, well accepted and the -- work like the work, like a gamer community. So it's very encouraging. I think like this also proves like after a couple of years accumulation of knowledge and know-how. And we start on the right track and we start to get the know-how in terms of the key factors, the key themes of the game development. And we feel very encouraged and we are continually strengthening these capabilities.

就像 2013 年那樣，我們首先在上海設立了工作室。但如今，我們工作室擁有約 200 位頂尖遊戲設計師。《Free Fire》就是一個很好的例子，我認為它還需要時間才能達到今天的水準。這樣我們就可以開發出一款廣受歡迎的遊戲，而且——像遊戲社群一樣運作。所以這非常令人鼓舞。我認為這也能證明，經過幾年的知識和技能積累，就能達到這樣的成果。我們走上了正確的道路，開始掌握遊戲開發的關鍵因素和關鍵主題的知識。我們深受鼓舞，並將持續加強這些能力。

Potentially, we may continually like adding the top-tier game developers in our studio. And there's -- if like we see good opportunities like our peers, we may, like we may set up like a new studios, right, to try and find the talent, right, in different market. And also, like, we may also possibly like just invest or acquire something like a proven game studios as well to continually strengthen our self-development capability. At the same time, I think like we're also very excited about like working with the top-tier game developers from all over the world to make sure to bring their best games, key games to gamers in our region.

我們可能會持續不斷地將頂尖的遊戲開發者納入我們的工作室。而且，如果我們像同行一樣看到好的機會，我們可能會，例如我們可能會建立一個新的工作室，對吧，去嘗試在不同的市場尋找人才。而且，我們或許還可以投資或收購一些成熟的遊戲工作室，以不斷增強我們的自我開發能力。同時，我們也非常興奮能夠與來自世界各地的頂級遊戲開發商合作，確保將他們最好的遊戲、最重要的遊戲帶給我們地區的玩家。

So in my view, I think this will be a very -- I think this is kind of like a very balanced approach. Initial -- like ultimately, I would say I would feel very happy if the split is about 50-50, like so probably half of the revenue from our self-developed games and half from like the games we partnered with like other top-tier game developer in the world.

所以在我看來，我認為這將是一個非常——我認為這是一種非常平衡的方法。最初——最終，如果分成比例是 50-50，我會非常高興，也就是說，一半的收入來自我們自己開發的遊戲，另一半來自我們與世界頂級遊戲開發商合作開發的遊戲。

And Varun, sorry, going back to your second question -- this is Alan. We unfortunately don't formally furnish EBITDA guidance. But let me share with you a few thoughts that may offer you at least the directional feel. First, an observation about the evolution of the market. It's very clear in our mind, and it becomes clearer with every passing day, that almost all of our markets are consolidating very quickly and more quickly than we would have anticipated that even 6 or 9 months ago.

Varun，不好意思，回到你的第二個問題——我是 Alan。很遺憾，我們不正式提供 EBITDA 指引。但我想跟你們分享一些想法，或許至少能給你們一些方向感。首先，觀察一下市場的發展演變。我們非常清楚地認識到，而且隨著時間的推移，這種認識也越來越清晰：幾乎所有市場都在快速盤整，其速度之快甚至超過了我們6個月或9個月前的預期。

Secondly, as a matter of principle, when given the choice to ease our spend and maintain our share or invest more heavily to expand our share, we've chosen the latter strategy. Reason being, we believe that investment is going to help us achieve dominance in the categories that are so important to us, female long-tail categories. That kind of dominance and the ability to be the go-to platform for these important and very profitable categories as we've talked about in the pastor should bring us to higher monetization levels going forward.

其次，從原則上講，當可以選擇減少支出以維持市場份額，還是增加投資以擴大市場份額時，我們選擇了後一種策略。原因在於，我們相信這項投資將幫助我們在對我們至關重要的女性長尾類別中取得主導地位。正如我們在牧師演講中提到的，這種主導地位以及成為這些重要且利潤豐厚的類別的首選平台的能力，應該會讓我們在未來實現更高的盈利水平。

So really, just to conclude, at the end of the day, winning a merchant or a customer today in our mind is much better than having to spend more to win them in the future. So I hope that gets you closer.

所以，總而言之，我們認為，今天贏得一位商家或顧客，遠比將來花更多錢去贏得他們要好得多。所以我希望這能讓你離目標更近一步。

And we will conclude our question-and-answer session. I would like to turn the conference back over to Forrest Li for any further remarks.

我們的問答環節到此結束。我謹將會議交還給李福瑞，請他再作發言。

Thank you. And thank you for everybody participating in today's like earnings call. And before we end the session, I would like to take this opportunity to extend my best wishes to Nick Nash, our Group President. As you may already know, like Nick is retiring from our company at the end of this year 2018. Nick has served as Sea's Group President since December 2014. And in the past 3 years, Nick played a very critical role in Sea's tremendous growth, especially in our IPO in 2017. I would like to express my sincere appreciation for Nick's distinguished achievement as Group President.

謝謝。感謝各位參加今日的財報電話會議。在會議結束之前，我想藉此機會向我們的集團總裁尼克·納什致以最美好的祝愿。您可能已經知道，尼克將於 2018 年底從我們公司退休。自 2014 年 12 月以來，Nick 一直擔任 Sea 集團總裁。在過去的 3 年裡，Nick 在 Sea 的巨大發展中發揮了非常關鍵的作用，尤其是在我們 2017 年的 IPO 中。我謹對尼克作為集團總裁所取得的傑出成就表示衷心的感謝。

Thank you so much, Forrest. Serving as Sea's Group President has been one of the happiest experiences of my professional career, and I'm deeply honored to have had the opportunity to work alongside Forrest and our entire team during a period of extraordinary growth for the company. The end of 2018 is a natural moment for me to retire both because of the milestones we have reached together as a team and also because of my personal aspirations for the next decades of my life. These past few years have been marked by very special milestones. Our company has executed well, achieving strong leadership positions across each of our 3 segments in a part of the world with substantial growth potential. With our IPO completed, we're on a stronger financial footing for our next phase of growth. And most important, I have great confidence in our next generation of rising leaders who will step into my responsibilities with skill and dedication.

非常感謝你，福雷斯特。擔任 Sea 集團總裁是我職業生涯中最快樂的經歷之一，我非常榮幸有機會在公司蓬勃發展的時期與 Forrest 和我們整個團隊一起工作。2018 年底對我來說是一個自然而然的退休時機，這不僅是因為我們作為一個團隊共同取得了里程碑式的成就，也是因為我對未來幾十年的人生抱持著個人願望。在過去幾年裡，出現了許多非常特殊的里程碑事件。我們公司執行得非常出色，在世界這個具有巨大成長潛力的地區，我們在三個業務部門都取得了強大的領導地位。隨著首次公開發行（IPO）的完成，我們擁有了更堅實的財務基礎，可以進入下一個成長階段。最重要的是，我對我們下一代冉冉升起的領導者充滿信心，他們將以精湛的技能和高度的奉獻精神接過我的職責。

On the personal front, as many of you know, I came from the investing world and spent over a decade with General Atlantic, supporting high-growth companies around the world, including Sea. I've always had a lifelong passion for investing and supporting growth companies. After reflecting on what I've learned here at Sea, I want to share the unique experiences I've had to help a new generation of companies here in Asia on their growth journeys. That sharing of learnings from one generation of companies to the next has been a hallmark of what made Silicon Valley so successful, and I look forward to continuing that tradition here in Asia by starting a new private equity fund after I retire, dedicated to that mission.

就我個人而言，正如你們許多人所知，我來自投資界，曾在 General Atlantic 工作十餘年，為世界各地的高成長公司提供支持，其中包括 Sea 公司。我一直以來都對投資和支持成長型公司充滿熱情。反思我在 Sea 的所見所聞後，我想分享我獨特的經驗，以幫助亞洲新一代公司在成長道路上取得成功。矽谷的成功秘訣之一就是將經驗從一代傳到下一代，我期待退休後在亞洲創辦一支新的私募股權基金，繼續傳承這項傳統，致力於實現這一目標。

Between now and then, I will remain deeply dedicated to Sea's mission and strategic priorities, and post my retirement, I will always remain a close friend of Sea over the years to come. I have no doubt that Sea's finest years are ahead of it, and I'm excited for the work we'll be doing in 2018 to make continued progress for our long-term goals.

從現在到那時，我將繼續全心全意致力於 Sea 的使命和戰略重點，退休後，在未來的歲月裡，我也會始終與 Sea 保持密切的友誼。我毫不懷疑 Sea 最輝煌的時期還在未來，我對 2018 年我們將開展的工作感到興奮，這些工作將使我們的長期目標不斷取得進展。

Thanks a lot, Nick. Well, this would conclude our conference call. As always, we remain available and committed to getting any questions that you, the investor and analysts, have. I look forward to continuing to liaise with you throughout the quarter and look forward to our next earnings call. Thank you very much.

非常感謝，尼克。好了，我們的電話會議到此結束。我們將一如既往地隨時為您（投資者和分析師）解答任何疑問。我期待在本季繼續與您保持聯繫，並期待我們的下一次財報電話會議。非常感謝。

And the conference is now concluded. Thank you for attending today's presentation. You may now disconnect.

會議到此結束。感謝各位參加今天的報告會。您現在可以斷開連線了。