It’s earnings season and Southeast Asia’s platform companies are trying once again to convince investors that they are on the path to profitability. The jury is still out as far as we’re concerned, especially in the case of any company that started out in the business of ride hailing and until recently emphasized growth at all costs. Having lost 75% of its market valuation since going public a little over a year ago, SoftBank and GIC-backed GoTo has yet to convince investors that it has turned a corner on the path to profitability, and we see little in its second-quarter earnings results that suggest anything has fundamentally changed for the better.

Investors are bullish on the potential of Singapore-based digital wealth management platform Endowus. Though the company’s current revenue is modest, and profitability remains very much in the future, Endowus still managed to recently raise US$35 million from some huge banks and four Asian billionaire families.

Sea Group’s stock took a pummeling on Tuesday, falling almost 29% to US$40.58 as investors reacted to a second quarter earnings report in which the company missed revenue forecasts though made a profit of US$331 million. In a nutshell, Sea’s triumvirate of digital services that once looked unassailable now seems a bit shaky as consumer spending in many of its key markets is not robust. We think the fintech business still has plenty of potential, and probably the same holds true for e-commerce, but the erstwhile profitable gaming arm has become a laggard.

Buy now, pay later (BNPL) has surged in Indonesia over the past few years, plugging a large lending gap and in many cases acting like a credit card in all but name. BNPL has grown so briskly in Indonesia that some analysts believe it will replace credit cards altogether.Perhaps not.

Australia-founded but Hong Kong-headquartered B2B payments sensation Airwallex has had a busy 2023 thus far. Not only did it just inject US$165 million into its Singapore entity, it also secured a China payments license in March and inked a partnership with American Express in January that will allow its clients in Australia, the UK, Singapore, and Hong Kong to accept Amex cards as a payment method option. It all seems to add up to an Asia-centric growth strategy that is less grandiose than what the Financial Times described in 2020 as the company wanting to “upend the global payments system.”

Japan’s cashless journey is unique in Asia. While most countries in the region that have accelerated cashless payments in recent years are seeking to simultaneously boost financial inclusion, Japan is one of Asia’s best banked countries, with more than 95% of its adult population having a bank account. For Japan, going cashless is not about increasing participation in the formal financial system, but rather about reducing cash-related costs, as well as bringing the country’s technological prowess to financial services and increasing competition in the financial sector.

Who says digital banks cannot make money? We often do – because it tends to be true. But Kakao Bank is a notable exception to the rule, and all the more unusual because its success has come in one Asia’s best-banked countries. Kakao Bank is one of the few digital lenders that has reached profitability and stayed there, as it showed with its solid second-quarter earnings.

In the mid-2010s, the fintech business of Tencent grew exponentially, with WeChat Pay and its offshoots allowing the company to become a viable competitor to Alipay in China. Yet even as Tencent captured close to half of China’s payments market, and established a digital bank, WeBank, that could rival Ant Group’s MYbank, it never displayed the same kind of appetite for global expansion as Jack Ma’s company.

Singaporean sovereign wealth fund GIC's annualized 20-year real rate of return - its main performance gauge - for the year ended March 2023 was 4.6% after accounting for inflation, the highest since 2015 and up from 4.2% a year earlier. GIC has a diversified portfolio of which certain Chinese investments are a big part, including Alibaba and Ant Group. The diversity of the portfolio likely helped GIC insulate its performance from the 2022 market correction.

Philippine President Ferdinand Marcos on July 18 signed a bill creating the Philippines’ first sovereign wealth fund, a move aimed at accelerating infrastructure and economic growth in one of the largest countries in Southeast Asia. The Philippines follows Singapore – whose two sovereign wealth funds are both success stories – as well as Indonesia (so far, so good) and Malaysia (failure) with observers divided over whether Marcos’ Maharlika Investment fund will deliver on its promises or be less successful.