Southeast Asia’s digital economy is expected to reach $368 billion.

Generative AI has moved from experimentation to routine use across Southeast Asia, with 243 million people—58% of the working population—actively using it, according to the 11th edition of the annual e-Conomy SEA report, titled Building the Intelligent Economy, published by Google, Temasek, and Bain & Company. The report finds that widespread AI adoption is propelling the region's digital economy to grow 17% year-on-year to $368 billion in Gross Merchandise Value in 2026, a trajectory that puts it on track to exceed $1 trillion by 2035. The authors also note that generative AI is scaling four times faster than the rollout of the mobile internet did.

Background: A Region Adopting AI Faster Than Mobile Internet

The e-Conomy SEA report is now in its 11th edition, and this year's study shifts its measurement lens: it uses tokens as the new benchmark for the AI economy. On that basis, the report projects that growing confidence in agentic commerce will drive a 60-fold surge in regional AI usage over the next five years. The underlying message is that AI is no longer a side experiment in Southeast Asia's digital economy—it is the mechanism sustaining growth across every sector the report tracks.

Development: AI Reshaping Each Digital Sector

The report breaks the digital economy into five segments, and AI shows up in each.

E-commerce remains the anchor at $226 billion in GMV, up 18% year-on-year. Shoppers are using multimodal discovery and in-app assistants to navigate complex purchases, and these personalized experiences organically drive 10% higher conversions along with order volume uplifts as large as 75%.

Online travel reached $59 billion in GMV, up 10% year-on-year. Traditional search engines remain the top platform people use to plan travel, but generative AI has overtaken social media to become the second-most used tool for organizing complex itineraries.

Online media generated $44 billion in revenue, up 22% year-on-year, as platforms personalize content feeds and connect audiences with more relevant ads. The result is a 10% to 20% quality engagement uplift, while commerce media becomes a $4 billion market.

Mobility and food delivery reached $40 billion in GMV, up 15% year-on-year. Predictive suggestions, smarter routing, and AI-powered offerings such as pooled rides are saving consumers time and fueling healthy transactional growth.

Digital financial services recorded $1,650 billion in GTV, up 16% year-on-year, with AI supporting real-time fraud detection, broader credit access, and personalized financial recommendations that complement human advice. The report also notes Singapore's regional leadership in digital wealth platforms.

What to Watch Next

The report's token-based projection—a 60-fold surge in regional AI usage over five years—is the number to track. It implies that the $368 billion GMV figure for 2026 is an early marker rather than a peak, and that agentic commerce, still an emerging behavior, is the variable most likely to determine whether the region stays on its path toward $1 trillion by 2035.