SINGAPORE – South-east Asia’s digital economy made US$11 billion (S$14.5 billion) profits in 2024, a blistering 2.5 times more compared to 2022.
While the amount is just 12 per cent of the sector’s total revenues of US$89 billion, the gains underscore three years of steady double-digit growth in surpluses in a young industry better known for losses among start-ups and sometimes, even big names.
Online media firms led the sector’s rise in profit margins over 2024 with a boom in video and music streaming, online gaming and exclusive video content, while travel portals widened profits for a second year after raising commissions and adding peripheral services such as guided trips and car rentals.
E-commerce, transport and food apps are still steeped in red, but have narrowed losses through stronger marketing, new products and cut-backs on customer and drivers’ incentives.
The insights are from the ninth edition of an annual report by consultancy firm Bain & Company, Temasek and Google, and covers Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam.
Collectively, these countries have a population of 612 million, almost double that of the United States.
While revenue growth and investors’ funding for the industry both slowed from 2023, Mr Florian Hoppe, partner at Bain, maintains an earlier forecast that the region’s digital companies will meet US$295 billion in gross merchandise value (GMV) in 2025.
GMV, the total value of goods sold between customers or from e-commerce platforms, is one indicator of growth. It does not include fees and deductions such as coupons.
Speaking at a panel to explain the findings on Nov 5, Mr Hoppe said that he expects players in e-commerce and transport and food apps to continue trimming losses to reach profitability.
He said: “In general, we see all sectors doing really well