South-east Asia's digital economy made US$11 billion (S$14.5 billion) in profits in 2024, a blistering 2.5 times more compared with 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 cutbacks 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 cover Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.
Collectively, these countries have a population of 612 million, almost double that of the US.
While revenue growth and investors' funding for the industry both slowed from 2023, Mr Florian Hoppe, a partner in Vector, Bain's digital delivery platform, and a senior member of Bain's telecommunications, media and technology practices, maintains an earlier forecast that the region's digital companies will meet US$295 billion in gross merchandise value (GMV) in 2025.
This story is from the November 06, 2024 edition of The Straits Times.
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This story is from the November 06, 2024 edition of The Straits Times.
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