Sea (SE) Shares Slide Despite 38% Revenue Growth

Chautauqua Capital Management, a division of Baird Asset Management, is a boutique investment firm that released its fourth-quarter 2025 investor letter for the “Baird Chautauqua International and Global Growth Fund”. A copy of the letter can be downloaded here. Global equities finished 2025 strongly, with international markets delivering their widest outperformance versus U.S. equities since the Global Financial Crisis, aided by a weaker dollar and improving trade conditions. In Q4 2025, the Baird Chautauqua International Growth Fund returned +0.11%, lagging the MSCI ACWI ex-U.S. Index’s +5.05%, while the Global Growth Fund gained +4.18%, outperforming its MSCI ACWI Index® ND’s +3.29%, as value and cyclical leadership weighed on growth-oriented portfolios. Despite near-term headwinds from sector rotations and Greater China profit-taking, the fund remains focused on high-quality businesses with strong cash flows and balance sheets, supported by attractive international valuations and a more favorable macro backdrop heading into 2026.

In its fourth-quarter 2025 investor letter, Baird Chautauqua International and Global Growth Funds highlighted stocks such as Sea Ltd. (NYSE:SE). Sea Ltd. (NYSE:SE) is a Southeast Asia–focused consumer internet company operating leading digital platforms across e-commerce, gaming, and digital financial services. The one-month return of Sea Ltd. (NYSE:SE) was approximately −2.50%, and its shares have gained about +4.69% of their value over the last 52 weeks. On January 26, 2026, Sea Ltd. (NYSE:SE) stock closed at approximately $125.93 per share, with a market capitalization of about $74.103 billion.

Baird Chautauqua International and Global Growth Funds stated the following regarding Sea Ltd. (NYSE:SE):

"Sea Ltd. (NYSE:SE) reported September quarter results that beat consensus estimates, with revenue growing 38% and gross merchandise value growing 28%. However, the stock sold off as Shopee's adjusted EBITDA margin declined sequentially to 0.6% despite improving take rates. Management signaled a preference for growth over near-term margin optimization, with ongoing investments in logistics, fulfillment capabilities, and its VIP membership program. Competition in both Brazil and Taiwan, combined with lack of clarity on 2026 margin targets, further weighed on sentiment."

Sea Ltd. (NYSE:SE) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 102 hedge fund portfolios held Sea Ltd. (NYSE:SE) at the end of the third quarter, which was 102 in the previous quarter. While we acknowledge the risk and potential of Sea Ltd. (NYSE:SE) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Sea Ltd. (NYSE:SE) and shared the list of best stocks to buy. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.