Business

How AI is Driving Profitable Growth in Southeast Asia

Published

3 hours ago

20 February 2026

How AI is Driving Profitable Growth in Southeast Asia

Southeast Asia’s digital economy is experiencing remarkable growth, reaching $11 billion in profitability, a 2.5x increase since 2022.

This dynamism is largely driven by artificial intelligence (AI). The region benefits from a young, digitally-native population eager to adopt AI, strong government support for AI frameworks and R&D investment, and a vibrant ecosystem of innovative startups.

Strategic investments in Generative AI, talent development, AI infrastructure, and a supportive policy environment are crucial for Southeast Asia to become a global AI leader, driving economic transformation and societal progress.

Key Points

The regional digital economy has achieved a 10x increase in revenue since 2016, with profitability rising from $4 billion in 2022 to $11 billion in 2024.
Southeast Asia’s population shows a high level of AI readiness, with Singapore, the Philippines, and Malaysia ranking among the top countries globally for AI-related interest and searches.
Significant capital is flowing into the region, with over $30 billion committed in the first half of 2024 alone to build AI-ready data centers across Malaysia, Thailand, and Singapore.
Generative AI (GenAI) is delivering rapid commercial value; 70% of regional organizations report a positive return on investment within 12 months of implementation.
Sector-specific benefits of AI are already visible, including personalized e-commerce recommendations, enhanced travel tools, and accelerated mobile game development.

Southeast Asian organizations are achieving a positive return on investment (ROI) on Generative AI (GenAI) workflows significantly faster than other regions—with 70% reporting positive ROI within 12 months.

The specific regional characteristics that allow for this accelerated success include:

A Digitally Native and Receptive Population: The region is home to a young, digitally native population that is quick to embrace AI-powered solutions. There is a high volume of AI-related interest, with countries like Singapore, the Philippines, and Malaysia ranking among the top globally for AI-related searches. Crucially, the document notes a regional culture of “acceptance and exploration,” where there is greater interest in the benefits of AI than apprehension regarding its risks.
Proactive Government Support and Flexible Regulation: Southeast Asian governments are actively fostering AI adoption through:
- National AI Frameworks: Developing clear strategic directions for AI.
- Regulatory Sandboxes: Implementing environments that allow for experimentation and innovation without the constraints of traditional regulation.
- Increased R&D Funding: Directing capital toward research and development.
Massive Infrastructure Investment: The region is rapidly building the physical foundations necessary for AI. In the first half of 2024 alone, over US$30 billion was committed to building AI-ready data centers in Singapore, Thailand, and Malaysia. This influx of capital facilitates accelerated computing and AI services, which are essential for moving projects from idea to production quickly.
A Vibrant Ecosystem of Innovators: There is a strong spirit of innovation across both startups and established sectors:
- Startups: Companies like Lytehouse AI, DiMuto, and CarbonSync are applying AI to diverse challenges in security, agriculture, and sustainability.
- Gaming Industry: The region accounts for 12% of all global mobile game downloads, demonstrating a level of technical prowess and creative energy that allows these organizations to use GenAI to lower development costs and expand libraries rapidly.

Generative AI: Transforming Industries and Unlocking New Value

Generative AI (GenAI), capable of producing innovative content and automating intricate tasks, is already showcasing its transformative potential to revolutionize industries and deliver measurable value across the region.

In e-commerce, GenAI powers personalized product recommendations, driving increased customer engagement, higher gross merchandise value (GMV) and larger basket sizes. The travel sector is also benefiting from AI-powered tools that enhance customer satisfaction and drive revenue growth. Similarly, the gaming industry is using GenAI to accelerate game development and build larger game libraries at lower costs, ultimately contributing to increased GMV.

Beyond these specific sectors, artificial intelligence is enhancing broader business functions across all industries. What’s truly remarkable is the speed at which companies in Southeast Asia are realizing value from GenAI.

The report revealed that most organizations can move from an initial idea to production within six months. Impressively, 7 out of 10 organizations in Southeast Asia report a positive return on investment (ROI) attributable to GenAI workflows within 12 months of implementation

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Bath & Body Works starts selling on Amazon as brands embrace logistics network

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Bath & Body Works starts selling on Amazon as brands embrace logistics network

An assortment of Bath & Body Works products.

Courtesy of Bath & Body Works

Bath & Body Works Champagne Toast body wash, with no minimum shipping threshold, is now just a click away for Amazon Prime members.

The mall-favorite brand is making some of its best-selling fragrances, body washes, hand soaps and candles available for Amazon’s U.S. shoppers. The selection is also eligible for Prime shipping.

Amazon is the No. 1 online destination for U.S. beauty shoppers, accounting for 47% of the online beauty and personal care market in the U.S. in 2024, according to Euromonitor. Sephora is second with 9% share. Euromonitor estimates 39% of all beauty and personal care sales take place online.

“Launching our first authorized brand storefront on Amazon allows us to put ourselves directly in the path of the consumer,” Bath & Body Works CEO Daniel Heaf told CNBC. “It’s about meeting them where they already shop.”

The Amazon launch marks the latest effort by Columbus, Ohio-based Bath & Body Works to expand its access points for customers. Last year, it began selling its products in college campus stores — with a footprint of now more than 1,000 locations — in the company’s first points of sale outside its roughly 2,600 owned and franchised stores and its own website.

Heaf joined Bath & Body Works in May after his role as Nike’s chief transformation and strategy officer was eliminated by CEO Elliott Hill.

Heaf recently laid out his “plan to return [Bath & Body Works] to profitable, sustainable growth.” He calls it a “consumer-first formula” with four pillars: creating disruptive and innovative products, reigniting the brand, winning in the marketplace, and operating with speed and efficiency.

The Amazon partnership, Heaf said, “is the first of many milestones that we’ll be delivering this fiscal year against that strategy.”

Before the official storefront launch, Bath & Body Works products were sold on Amazon through third-party resellers.

Now, Heaf says the company is attempting to reclaim the brand story on Amazon — and those marketplace sales.

Amazon: Friend or foe?

While Amazon has many first-party relationships with brands from Nike to Calvin Klein that use wholesale partnerships as part of their business models, there are few examples of retailers selling on the site that design, manufacture and sell their products entirely on their own.

For those so-called vertically integrated brands, like Bath & Body Works, Amazon is increasingly filling the role of skilled logistics partner rather than retailer.

Gap, J. Crew and Everlane are similarly vertically integrated and have small selections of branded products for sale on Amazon.

Gap began selling what it calls “core basics for the whole family” in 2022 through a wholesale relationship, where Amazon owns and sells the products, which are Prime eligible. Gap has said its goal is to reach new or lapsed customers as well as provide existing shoppers the convenience for “core essentials.”

Under Bath & Body Works new agreement with Amazon, the brand will retain ownership of the inventory and control pricing, but will use Amazon’s fulfillment partners network for Prime eligibility.

Everlane declined to comment on its Amazon partnership. J. Crew did not respond to request for comment.

Jewelry company Kendra Scott has an authorized storefront on Amazon after initially opposing the partnership — even though it had wholesale relationships with other retailers, including Macy’s and Nordstrom. But over time, the brand began to view Amazon as another opportunity to reach shoppers rather than a competitive threat, according to a person familiar with the company’s decision making, who spoke about internal matters on the condition of anonymity.

On its own website, Bath & Body Works is making it easier for shoppers to place their orders. The company lowered its free shipping threshold to $50 from $100 last month.

Still, Heaf admits, “We know that we will never compete with Amazon in terms of their Prime Network. No one is going to be offering next-day shipping. That’s just not what we’re in the business of. And so I think that by going on Amazon, we are also making our own site more competitive but recognizing that our job is not to build a fulfillment network that can operate at the speed of Amazon.”

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I’m an independent equity trader and licensed financial advisor focused on uncovering high-upside opportunities in overlooked sectors especially focusing on small-caps, energy, commodities, and special situations. My investment strategy is based on growth. I look for fundamental momentum (EPS, ROE, revenue), price-volume confirmation, and macro filters. I also use econometric tools and calculations to analyse market direction, cycles and behaviour. I’ve been managing personal capital since 2020 and advising under MiFID II since qualifying with a license. I hold a bachelor’s in Business Administration and Economics and am currently completing a master’s in Finance. My masters thesis topic: Impact of Financial Results Announcements on Stock Returns and Trading Volumes of Micro-Capitalization Gold Mining Companies.

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha’s Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Business

Aston Martin warns on profits as US tariffs and falling sales hit earnings

Published

1 hour ago

20 February 2026

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The luxury car maker warned earnings will fall below £184m for 2025 as it also sells F1 team naming rights for £50m

Henry Saker-Clark PA Deputy Business Editor

10:20, 20 Feb 2026

The Aston Martin logo(Image: PA)

Aston Martin has cautioned that it will report lower-than-anticipated profits for the previous year, driven by declining sales as it grapples with pressure from US tariffs. The news came as the luxury car manufacturer also revealed the sale of naming rights for its Aston Martin F1 team to a related party in a bid to bolster its finances.

London-listed Aston Martin Lagonda has been pressing ahead with efforts to turn its fortunes around under Canadian billionaire Lawrence Stroll. However, the company shed light on the scale of the challenge ahead with its latest profit warning update.

The car manufacturer told shareholders on Friday that gross profit margins and adjusted earnings before interest and tax are expected to come in “slightly below” the lower end of analyst expectations.

This means the Warwickshire-based company is anticipating earnings below £184 million for 2025.

Senior figures said it followed the company navigating “a highly challenging trading environment” throughout the year.

The firm stressed that it made headway on its transformation despite mounting pressure from increased tariffs in the US and a decline in deliveries of higher-margin Special model vehicles.

Total wholesale volumes fell to 5,448 in 2025, down from 6,030 the previous year, the company confirmed.

The US remains the car maker’s largest market, though it was struck by a 10% tariff last year, reduced from a previously planned 27.5%.

Aston Martin has taken steps in recent months to strengthen its financial position, including scaling back investment plans last October. The company revealed on Friday a £50 million agreement to sell the naming rights of its Aston Martin F1 Team to associated party AMR GP Holdings.

Under the terms of the deal, AMR will retain use of the Aston Martin name in F1 through to 2055. Executives confirmed the agreement would strengthen Aston Martin’s liquidity position.

Aston Martin has its headquarters in Gaydon, Warwickshire, with a manufacturing base in St Athan, South Wales, and a base in Newport Pagnell.