Google, Temasek, and Bain & Company have launched the 10th edition of the annual e-Conomy SEA report, From Digital Decade to AI Reality: Accelerating the future in ASEAN.
For the first time, the report has expanded its coverage from six markets 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 revenue seeing steady growth of 15% year-on-year (YoY), the report predicts that Southeast Asia’s digital economy is on track to surpass $300 billion in GMV by 2025 — 1.5 times the inaugural forecast 10 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 million, 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 payments. 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:
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 fueled 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, fueled 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 ison track to hit $34 billion in GMV in 2025. Advertising growth (16% YoY) is fueled 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 nations have enabled cross-border QR interoperability. DFS growth is fueled 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 markets.
A cautious uptick in private funding with shifts towards late-stage deals and DFS
Private funding 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.
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.
The region’s workforce is seizing the AI opportunity and actively developing their skills. 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.
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 fueled by major global players choosing the region as a new hotspot for cloud and data centre investments.
“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,” said Sapna Chadha, Vice President for Southeast Asia and South Asia Frontier, Google.
“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.”
