Singapore, 11 November 2025 – Google, Temasek, and Bain & Company today launched the 10th edition of the annual e-Conomy SEA report¹, From Digital Decade to AI Reality: Accelerating the future in ASEAN. For the first time, the report has expanded its coverage from six markets² to ten Southeast Asian nations — adding Brunei, Cambodia, Laos, and Myanmar — to offer a more holistic view of the region’s evolving digital economy.

With both Gross Merchandise Value (GMV) and revenue³ seeing steady growth of 15% year-on-year (YoY), the report predicts that Southeast Asia’s digital economy is on track to surpass $300 billion⁴ in GMV by 2025 — 1.5 times the inaugural forecast  years ago. Revenues are forecasted to hit $135 billion as profitability accelerates across the region.

As the world’s fifth largest economy with a population of over 680 million⁵, Southeast Asia has undergone a remarkable digital transformation over the past decade. The region’s digital economy has shown resilience, leveraging successful monetisation strategies despite global headwinds such as COVID and inflation. Key milestones over the decade include: 7.4x GMV and 11.2x revenue growth, $120 billion in private funding that has been invested, and the entry of over 200 million new internet users, accelerating adoption across sectors such as e-commerce and digital payments⁶. Today, three in five people in the region shop online, and over 60% of all payments are digital.

Key findings from this year’s report include:

1. Southeast Asia’s digital economy sustains growth momentum through innovation and monetisation discipline

E-commerce is picking up, with GMV and revenue projected to reach $185 billion and $41 billion respectively in 2025. This acceleration is driven by two key factors: the significant economies of scale of leading platforms, which create distinct competitive advantages, and the rapid expansion of video commerce. Video commerce now accounts for approximately 25% of total GMV. This trend is fuelled by a high volume of lower-value transactions, the influence of trusted local creators, and seamless social-to-e-commerce integrations that convert user attention into sales with minimal friction.

Food delivery Most food delivery platforms are now profitable or are approaching profitability by building more sustainable business models. They have made significant progress in reducing their cost to serve through optimised logistics and streamlined operations in key metro areas. Food delivery GMV is projected to reach $23 billion, with revenue nearing $2.4 billion in 2025. The segment is diversifying its earnings with advertising revenue that is surging 60–90% YoY, as well as commissions from dine-in vouchers, loyalty subscriptions, and cloud kitchens.

Transport continues to grow by offering tiered services and subscription bundles, while in-app ads provide an additional revenue stream. Projections show GMV reaching $11.5 billion and revenue climbing to $1.9 billion in 2025.

Online travel continues to grow, with GMV projected to hit $51 billion and revenue set to reach $24 billion in 2025, fuelled by high airfares and accommodation rates. Indonesia, Malaysia, and Vietnam have boosted arrivals from China and India by expanding visa-free or e-visa schemes, recording double-digit growth in total arrivals in the first half of 2025. Meanwhile, Japan is solidifying its status as a top destination for Southeast Asian travellers, while China is rapidly gaining ground.

Online media is on track to hit $34 billion in GMV in 2025. Advertising growth (16% YoY) is fuelled by the rise of retail media networks, increasing maturity of video commerce and AI-powered ad formats. Gaming (6%) continues to expand its user base, particularly in Indonesia. Growth of Video (15%) and Music (14%) segments continue, although slowing from their 2024 peaks.

Digital Financial Services (DFS) is swiftly maturing beyond payments. Financial inclusion is expanding through embedded lending solutions targeting underserved segments and greater regional connectivity and adoption. Ten Southeast Asian countries are now using national unified QR systems, and eight nations⁷ have enabled cross-border QR interoperability. DFS growth is fuelled by digital lending, where ecosystem players leverage in-app data for underwriting, and a surging digital wealth segment, where several platforms now exceed $1 billion in Assets Under Management for six Southeast Asian markets⁸.

2. A cautious uptick in private funding with shifts towards late-stage deals and DFS

Private funding⁹ is up 15% YoY to around $8 billion, driven by investors focusing on late-stage deals and the DFS sector, which is drawing about half of the total deal value. The increase in late-stage investments, the largest since the second half of 2023, has been driven by both private equity activity and also corporate investments. While early-stage funding continues to contract, growth-stage deployment stabilised YoY compared to H1’24. The number of growth-stage investments fell YoY, but the average deal size of growth-stage investments has increased, showing discipline and greater concentration of capital into higher quality businesses. Funding continues to diversify into nascent sectors, particularly software and services. A majority of investors expect funding to increase in Singapore, Vietnam, and Malaysia, with a particular emphasis on software and services, as well as AI and deep tech.

This cautious uptick is underpinned by three key enablers: realistic entry valuations which have largely settled at sustainable levels, proven monetisation models where revenue growth keeps pace with GMV, and a clearer path to profitability for established digital players. The focus now is shifting to the fourth enabler - dependable exit pathways - which is showing positive signs and healthy IPO pipeline in the region.

3. Southeast Asia is rapidly positioning itself at the forefront of the global AI transformation, driven by a thriving ecosystem of adopters, innovative startups, and major investors

This transformation is already part of everyday life in the region, with consumer interest in AI topics 3x higher than the global average. Five countries from the region – Singapore, Brunei, Philippines, Indonesia, Malaysia – already rank among the world’s top 20 for interest in multimodal AI. Three out of four users say AI-powered tools have helped them discover content and make tasks easier, while nearly half (45%) expect to save time on research and make decisions faster.

79% of workers said they have learned to use AI, and 43% report using it both personally and professionally.

With over 4,600 MW new capacity planned, the region’s data center capacity is set to grow by 180% – faster than the 120% growth projected for the rest of Asia Pacific.¹⁰

AI is a bright spot for investors in Southeast Asia. Over the past twelve months, more than $2.3 billion has been invested in the region's over 680 AI startups, accounting for over 30% of private funding value in the first half of 2025. This momentum is further fuelled by major global players choosing the region as a new hotspot for cloud and data centre investments.

The region's workforce is seizing the AI opportunity and actively developing their skills.

“Surpassing the $300 billion GMV milestone by 2025—1.5x our ambitious forecast from a decade ago—firmly validates that Southeast Asia’s potential is even greater than we imagined. Backed by strong fundamentals, robust macroeconomic conditions, and new consumer behaviors, the transformative impact of AI and the shift toward sustainable profitability are clear. The future here will be defined by speed as the region harnesses its proven ability to seize the returns of this new age not in years, but in months. We remain deeply committed to partnering with Southeast Asia as it accelerates toward its next ambition: becoming a thriving intelligent economy,” said Sapna Chadha, Vice President for Southeast Asia and South Asia Frontier, Google.

“Funding levels in Southeast Asia’s digital economy have stabilised as investors are continuing to emphasise a focus on quality growth and efficient capital allocation over absolute capital deployment. Temasek remains committed to the region’s digital economy, by deploying our capital to growth-stage businesses, to help take proven business models from start-up to scale-up. Investors, regulators, and management teams of companies must work together to drive sustainable growth, operations, and governance among businesses,” said Fock Wai Hoong, Head, Southeast Asia, Temasek.

“Southeast Asia’s digital economy has shown extraordinary growth and remarkable resilience, sustaining momentum despite periods of investor caution and a shifting macroeconomic landscape over the last decade. With GMV on track to surpass $300 billion by 2025, the region’s ‘digital decade’ has built a strong foundation to chart the next phase of value creation. The real opportunity now lies in how businesses harness AI as a catalyst for impact while balancing the region’s structural realities. As markets consolidate and investor confidence returns, the next wave of growth will be more focused, efficient, and innovation-led,” said Florian Hoppe, Partner, Bain & Company.

Singapore: A pillar of resilience and global AI governance

Singapore’s digital economy continues to demonstrate maturity and leadership, setting regional standards for technology governance while navigating global uncertainty. Its GMV is projected to reach $29 billion in 2025, up 7% from 2024, driven by strong momentum in key sectors. Transport & Food is expected to grow 12% to $6 billion, while Online Media is set to surge 13% to $3.4 billion. Local commerce is showing accelerated adoption of video commerce, with sellers and stores rising 125% YoY to 80,000, and transaction volume jumping 30% YoY to 45 million.

As a mature financial hub, Singapore’s DFS sector is steadily gaining ground. Digital Lending is forecasted to grow 12% to $30 billion in loan book balance, while Digital Wealth (AUM) is projected to rise 22% to $44 billion in 2025 — driven by licensed digital banks capitalizing on strategic ecosystem partnerships.

Finally, Singapore remains the leading regional AI hub, having secured $1.31 billion in private AI funding — the highest among SEA-6 countries. This strong economic performance is marked by a notable 55% funding growth (H1 2025 vs. H2 2024). This resilience, coupled with a strong government focus on worker protections and AI governance, cements its position as a vital regional hub for technology and finance.

“Singapore’s strength lies in its dual focus: driving relentless digital innovation while building a robust framework for AI governance. As a global hub, its pioneering approach to responsible AI and its stable, mature ecosystem are setting an important benchmark for the rest of Southeast Asia. This ensures that the next wave of digital growth is not only fast and far-reaching, but also safe, inclusive, and sustainable for all,” said Sapna Chadha.

“Singapore is strengthening its role as a tech and financial hub by emerging as a centre for AI innovation, attracting AI companies across Southeast Asia to establish their regional or global operations here. Ongoing efforts to strengthen regional cooperation and improve capital market conditions in Singapore will help to ensure that Southeast Asia’s AI ambitions continue to be realised,” said Fock Wai Hoong.

“Singapore continues to anchor Southeast Asia’s digital economy. Its early momentum in scaling AI capabilities can unlock a broader regional opportunity to turn transformation into lasting economic value and build into another decade of growth ahead. Importantly, it can also play a key role in unlocking funding and the exit environment for the region," said Florian Hoppe.

End.

For more information: Please contact Keith Kay at 9628 4263 or e-conomysea@tateanzur.com

About Google

Google's mission is to organize the world's information and make it universally accessible and useful. Through products and platforms like Gemini, Search, Maps, Gmail, Android, Google Play, Google Cloud, Chrome and YouTube, Google plays a meaningful role in the daily lives of billions of people and has become one of the most widely-known companies in the world. Google is a subsidiary of Alphabet Inc.

About Temasek

Temasek is a global investment company headquartered in Singapore, with a net portfolio value of S$434 billion (US$324b, €299b, £250b, RMB2.35t) as at 31 March 2025. Its Purpose “So Every Generation Prospers” guides it to make a difference for today’s and future generations. Temasek seeks to build a resilient and forward-looking portfolio that will deliver sustainable returns over the long term. 

It has 13 offices in 9 countries around the world: Beijing, Hanoi, Mumbai, Shanghai, Shenzhen, and Singapore in Asia; and Brussels, London, Mexico City, New York, Paris, San Francisco, and Washington, DC outside Asia.

About Bain & Company

Bain & Company is a global consultancy that helps the world’s most ambitious change makers define the future. Across 65 cities in 40 countries, we work alongside our clients as one team with a shared ambition to achieve extraordinary results, outperform the competition, and redefine industries. We complement our tailored, integrated expertise with a vibrant ecosystem of digital innovators to deliver better, faster, and more enduring outcomes. Our 10-year commitment to invest more than $1 billion in pro bono services brings our talent, expertise, and insight to organizations tackling today’s urgent challenges in education, racial equity, social justice, economic development, and the environment. We earned a platinum rating from

EcoVadis, the leading platform for environmental, social, and ethical performance ratings for global supply chains, putting us in the top 1% of all companies. Since our founding in 1973, we have measured our success by the success of our clients, and we proudly maintain the highest level of client advocacy in the industry.

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¹The annual e-Conomy SEA Report deep dives into trends and insights of the five mainstay digital sectors - e-commerce, travel, food and transport, online media, and digital financial services (DFS) - and covers the state and outlook of SEA’s technology funding landscape across six countries - Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam. The annual e-Conomy SEA report deep dives into trends and insights of the five mainstay digital sectors - e-commerce, travel, food and transport, online media, and digital financial services (DFS) - and covers the state and outlook of SEA’s technology funding landscape across ten countries - SEA-6 (Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam), and for the first time this year, the ASEAN-4 countries (Brunei, Cambodia, Laos, and Myanmar). Timor-Leste is not included as it became part of ASEAN in October 2026.

²Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam

³GMV includes ecommerce, food delivery, transport, online travel, and online media, while revenue includes the same sectors and digital financial services.

⁴All $ amounts are in US$.

⁵ASEAN Report Dec 2024

⁶GMV includes only ecommerce, food delivery, transport, online travel, and online media, while revenue includes digital financial services in addition to GMV sectors. Figures for 2016-2024 cover SEA-6 markets, while 2025 figures include the rest of ASEAN-10 and are based on annualised results from H1 2025. The number of internet users spans ASEAN-10.

⁷Indonesia, Cambodia, Malaysia, Laos, the Philippines, Singapore, Thailand, Vietnam

⁸Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam

⁹Private funding value covers digital economy-related sectors and excludes public financing deals (e.g. PIPE, IPO, ICO).

¹⁰Analysis is based on publicly reported announcements as of H1 2025. Planned capacity includes under construction, committed, and early-stage announcements.