The latest report released on Monday adds new sectors such as online food delivery, as well as subscriptions to music and videos.
It estimated that the gross merchandise value (GMV) of the region's internet economy has reached $72 billion in 2018, rising 37 per cent from the year earlier.
The region's biggest companies, like Alibaba Group Holding, Shopee or Tokopedia will also play a major role. The region's ride-hailing market will expand to about $7.7 billion in 2018 and is expected to reach $28 billion by 2025, underscoring the ambition of Go-Jek and Grab to become Southeast Asia's super apps.
"Powered by the ambitions of Go-Jek and Grab to become Southeast Asia's "everyday apps", we project that ride hailing will reach nearly 30 billion dollars by 2025", the Google-Temasek study said.
In last year's report, Google and Temasek, Singapore's state investment company, had estimated the Southeast Asian internet economy would reach $200 billion by 2025. Temasek-backed Vertex Ventures is an early investor in Grab. Google and Temasek began including online food delivery in this category for the first time this year, given the growing importance of that business.Online travel is the largest and most established among the four sectors of the internet economy, accounting for about $30 billion in bookings in 2018.
It added that 2018 was on track to be a record year for fundraising for the region's internet economy companies, with 9.1 billion dollars raised in the first half of the year, almost as much as in all of 2017. That includes Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.
"The record-breaking pace of the region's internet economy in 2018 wasn't a freak occurrence", wrote Google.
The growth is being boosted by the world's most engaged internet users, of whom more than 90 per cent connect to the web through their smartphones, it said.