AI in Southeast Asia: An era of opportunity
February 10, 2026 | Infographic
A region on the rise for AI opportunities
AI adoption in Southeast Asia is at an inflection point—moving rapidly from exploration to deployment. With strong digital foundations, tech-savvy enterprises, and a young, connected population, the region’s major economies are accelerating toward global competitiveness.
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2
Three traits set high-performing organizations apart
They redesign workflows
The narrative in Southeast Asia is rapidly moving from experimentation to enterprise-wide scaling. The focus is now on embedding AI into core business processes to drive tangible value.”
AI adoption across regions, % of respondents
— Vivek Lath, McKinsey partner
Fully scaled
Scaling
Piloting
No use
Experimenting
Global
19
28
38
8
Southeast Asia
Nearly half of Southeast Asian companies surveyed have moved beyond AI pilots, putting the region slightly ahead of the global average. This momentum is driven by a mobile-first consumer base, skilled talent, and local solution providers—creating fertile ground for rapid AI scaling, despite limited policy intervention.
AI adoption in Southeast Asia shows stronger momentum than the global average
1
High performers are twice as likely to integrate AI fundamentally instead of just layering it onto existing processes.
They invest boldly in AI
They embed strong AI governance
While most organizations can experiment with AI, only those that build the right organizational and technological foundations succeed in capturing sustained value. And they have three things in common.
High performers are more likely to expect their organizations to use AI for enterprise-wide transformative change.
Nearly half of high performers’ senior leaders demonstrate true ownership and commitment to AI inititatives.
AI high performers
55%
All others
29%
2×
AI high performers
48%
All others
22%
2.2×
48%
— Saurish Basu, McKinsey associate partner
Organizations in Southeast Asia are rapidly progressing on getting their infrastructure set up for scaling AI. The winners will be those who are able to take the opportunity to reimagine their business and workflows, rather than purely using AI to digitize existing processes.”
Southeast Asia is the world’s AI arena
3
has been invested by hyperscalers such as Amazon Web Services (AWS), Google, and Microsoft in AI-ready data center and cloud infrastructure across the region
US $50 billion
Over
July 2025
Alibaba Cloud opened its third data center in Malaysia in
2021
Tencent Cloud (China) has operated a data center in Jakarta since
AI centers of excellence, including those of Alibaba Cloud (China), IBM, NVIDIA, and Oracle (US)
60
Singapore alone hosts more than
in cloud and AI services in Malaysia
US $2.2 billion
Microsoft is investing
investment in Singapore by 2028 and US $6 billion in Malaysia until 2038
US $9 billion
AWS has committed an additional
across the region. In e-commerce, YouTube and Singapore's Shopee collaborate on YouTube Shopping in Indonesia, while Temu expands from Malaysia and the Philippines into Thailand
Companies compete
data center and Google Cloud region in Malaysia in 2024
US $2 billion
Google announced a
— Paul Beaumont, McKinsey partner
The most successful companies anchor their AI agendas in three principles: outcomes over experimentation; leveraging ecosystems that can take ‘best of breed’ from the US and China; and investing deeply in human capital and data as much as they do the technology.”
Unlocking Southeast Asia’s AI potential requires all stakeholders—governments, academia, tech providers, and organizations—to work together. Success depends on:
Collaboration is the key to an AI-ready ecosystem
4
Seamless and secure movement of data across borders and sectors can boost innovation and growth.
Trusted data flows
Developing and attracting skilled professionals can ensure that the region builds, deploys, and manages AI at scale.
A strong pipeline of talent
Clear governance and ethical standards can build trust and safeguard society as AI adoption accelerates.
Responsible AI use
Partnerships between industry, government, and academia can drive practical solutions and accelerate progress.
Cross-sector collaboration
Expanding digital and cloud infrastructure can ensure that organizations of all sizes can access and benefit from AI technologies.
Robust, inclusive infrastructure
Southeast Asia stands at an inflection point in its AI journey. The next phase will hinge on execution: How effectively enterprises, governments, and technology partners can work together to translate ambition into sustained value and kickstart the era of opportunity. Now is the time for the region not only to accelerate its own growth but also to shape what responsible, inclusive, and successful AI leadership looks like for the world.
30
28
29
6
6
By Vinayak HV and Vivek Lath, with Amy Yu and Saurish Basu
Vinayak HV is a senior partner in McKinsey's Singapore office, where Vivek Lath is a partner, and Amy Yu and Saurish Basu are associate partners.
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The authors wish to thank the Singapore Economic Development Board (EDB), in collaboration with Tech in Asia for their contributions to this report.