This weekly newsletter chronicles top digital themes and trends playing out in SE Asia, especially Indonesia. We will decode policy and regulatory changes affecting digital economy sectors, crunch earnings data of top players, track developments related to gig economy workers and attempt to piece together ecosystem buildouts in some of the fastest-growing, venture-backed plays. You can access the previous editions of the Vantage Point weekly posts here.
Executive Summary
- SE Asia’s digital economy – There is no accounting for taste
- GoTo – Adding more colour to its journey
SE Asia’s digital economy – There is no accounting for taste
The Q1 2023 results for SE Asia’s listed tech players – Sea Ltd, Grab, GoTo, Bukalapak, Blibli, and PropertyGuru- reflected a marked and continuing focus away from headline GMV growth toward real performance measures such as revenues, adjusted EBITDA, and, in Sea Ltd’s case, actual profit.
A slowdown in GMV was expected with most players de-emphasising or even discrediting GMV as a metric other than being an output metric. After all, GMV could rise to $1 billion or more, but revenue could still be zero or worse.
Q1 of the year is often a slower seasonal period, with Q4 being the strongest quarter for consumption in most geographies. The other important factor to consider this year is 2022’s high base for comparison during Q1, with COVID-induced demand benefitting segments such as e-commerce and food delivery last year.
There was also a confluence of seasonal factors in Q1 2023, with both Chinese New Year and Ramadan falling within the quarter. This markedly impacted food delivery, with people eating out rather than taking deliveries at home this year.
The outcome for GMV or TPV was not all gloom and doom, with Q1 not a slow quarter by any means as it saw decent growth rates in e-commerce despite the rise in offline activity. Mobility saw a fuller benefit from changing habits, although activity was still some way below pre-COVID levels for both Grab and Gojek, leaving further room for an upside this year.
