EMQQ Global Performance Overview
The leading positive contributors to performance for the EMQQ Index in August came from Nubank, the dominant digital bank in Latin America, and Sea Limited, the leading e-commerce company in Southeast Asia. Both rose on the back of strong quarterly results, which saw both strong topline and user growth. More on both below.
The two largest detractors for the month were China’s Meituan and South Korea’s Naver, both of which declined on softer-than-expected quarterly results. Nonetheless, both companies continue to register solid growth while also making a series of inroads on AI-related initiatives.
Sources: Bloomberg, Company financials
At a Glance:
Tencent’s Growth Jumps to Four-Year High
Alibaba Cloud Impresses + Launches New Chip to Challenge NVIDIA in China
Brazil’s Nubank Delivers 40% Growth (Again)
Sea Limited’s Growth Surges to Top Company in SE Asia
India’s GDP Growth Nears 8%
India Announces Sweeping Tax Reforms and Cuts
India’s JIO Plans Bellwether IPO
Chart of the Month
Tencent’s Growth Jumps to Four-Year High
Tencent reported an impressive second quarter, showcasing strong momentum across gaming, advertising, and AI-driven initiatives. Overall sales improved 15%, marking the best quarterly growth for the Chinese internet giant in four years. Domestic gaming revenue rose 17% year-on-year to $5.6B, fueled by blockbuster launches like Delta Force alongside enduring hits such as Honor of Kings, VALORANT, and Peacekeeper Elite. International gaming climbed 35% to $2.6B, led by PUBG Mobile and Dune: Awakening. Marketing services revenue advanced 20% to $5.0B, supported by AI-powered improvements to advertising and Weixin’s transaction ecosystem.
Capital expenditures surged 119% to $2.6B as Tencent invested aggressively in AI upgrades for ads, gaming, and Weixin. Tencent Music also delivered strong results with 124M subscribers. Management highlighted the company’s growing focus on AI use cases, including its Yuanbao app and HunYuan models, while also expanding cloud ambitions into Europe.
Alibaba Cloud Impresses + Launches New Chip to Challenge NVIDIA in China
Alibaba delivered a solid June quarter, showcasing resilience and renewed growth momentum. Net income surged 78% year-on-year to $6 billion, far surpassing expectations, while revenues reached $34.6 billion. The standout was Alibaba’s cloud division, with revenues jumping 26% to $4.7 billion, its fastest growth in over a year, powered by soaring AI-related demand. AI services posted triple-digit growth for the eighth consecutive quarter, cementing Alibaba as a global AI player. Meanwhile, the company also announced plans to test a new artificial intelligence chip that could rival NVIDIA’s H20 line of chips in China. The move not only highlights Alibaba’s innovative prowess, but it could also fill a key gap left by availability issues of NVIDIA chips in China, helping further fuel the AI growth we’ve seen thus far this year. We will continue to monitor these developments closely in the coming months.
Brazil’s Nubank Delivers 40% Growth (Again)
Nubank, the largest digital bank and fintech in Latin America, delivered a strong second quarter, reporting net profit of $637M, up 42% year-on-year, with revenue climbing 40% to $3.7B. The digital lender now serves nearly 123M clients across Brazil, Mexico, and Colombia, underscoring its scale in Latin America. In Brazil alone, over 60% of adults are now Nubank customers. Profit growth was fueled by operational leverage and revenue gains, while strategy is shifting toward deepening relationships with existing customers. Nubank’s loan book expanded 8% from the prior quarter to $27.3B, supported by growth in personal loans. Credit quality held firm, with early defaults improving to 4.4% and over-90-day delinquencies stable at 6.6%. Annualized return on equity remained a strong 28%, reflecting robust profitability. Management emphasized continued lending growth, supported by resilient asset quality and customer engagement.
Sea Limited’s Growth Surges to Top Company in SE Asia
Sea Ltd., Southeast Asia’s internet giant, reported its strongest quarterly performance since early 2022, driven by rapid growth across e-commerce, digital payments, and gaming. Revenue rose 38% year-on-year to $5.26B, surpassing expectations, with e-commerce sales up 34% to $3.8B. Shopee, Southeast Asia’s largest e-commerce platform, continued to expand its reach across ASEAN, while SeaMoney achieved outstanding momentum with 70% revenue growth to $883M. Garena, the company’s digital entertainment and gaming arm, posted a 28% revenue increase to $559M. Adjusted EBITDA surged 85% to $829M, while net income climbed 418% to $414M. CEO Forrest Li emphasized that Sea is now positioned to balance growth and profitability, leveraging its market leadership to capture long-term opportunities across digital ecosystems. Meanwhile, Sea’s strong results recently propelled it to become the most valuable company in Southeast Asia, overtaking banking firm DBS.
India’s GDP Growth Nears 8%
India’s economy expanded by a stronger-than-expected 7.8% in the June quarter, outpacing forecasts of 6.7% and highlighting robust momentum across manufacturing (7.7%), services (9.3%), and construction (7.6%). Despite challenges from newly imposed U.S. tariffs, economists remain upbeat, projecting India to sustain world-leading growth of around 7% this year. Supported by proactive central bank measures, tax reforms (discussed below) and resilient domestic demand, India continues to stand out as one of the fastest-growing major economies globally, reinforcing its long-term growth trajectory.
India Announces Sweeping Tax Reforms and Cuts
India is preparing major tax reforms aimed at boosting consumption and supporting households. The government plans to simplify the Goods and Services Tax (GST) structure into two slabs—5% and 18%—eliminating the 12% and 28% rates. Nearly all goods currently taxed at 12% may shift to the 5% bracket, lowering costs for consumers and benefiting a wide range of consumer and consumer tech companies. Prime Minister Modi promised “next-generation GST reforms” to ease the tax burden by October this year. While analysts estimate a modest revenue impact, the move is expected to stimulate demand and provide meaningful policy stimulus, reinforcing India’s commitment to growth-friendly reforms.
India’s JIO Plans Bellwether IPO
Mukesh Ambani, India’s richest man, announced that Reliance Jio, the nation’s largest telecom and tech operator, will be listed by the first half of 2026. Jio is responsible for driving India’s mobile data costs to amongst the lowest in the world, helping accelerate smartphone adoption in the world’s largest country. Since launching in 2016, Jio has surpassed 500 million Indian users and has amassed investors ranging from Facebook, Microsoft, and Google…making it a driving force in India’s digital transformation. Ambani highlighted Jio’s remarkable decade of growth and outlined ambitions to expand globally. He also unveiled two AI partnerships: a collaboration with Google to empower developers and startups, and a $100 million joint venture with Facebook/ META to scale enterprise AI solutions. With Jio valued at around $100 billion, the listing is poised to be one of India’s most significant IPOs ever.
Mercadolibre’s Growth Continues Unabated
Latin America’s MercadoLibre delivered another strong quarter, with 34% YoY revenue growth to $6.8 billion, adding to continued momentum. Gross merchandise volume rose 37%, and the number of items sold increased 31%, the fastest growth since mid-2021. Meanwhile, the fintech arm continued to shine—Mercado Pago’s credit portfolio expanded 91% to $9.3 billion, with default rates improving. Despite margin pressure from expanded free shipping initiatives in Brazil, which slightly compressed EBIT margins, EBIT still reached a record $825 million. These performance gains reflect MercadoLibre’s powerful combination of demand growth and scalable network infrastructure, positioning it well for long-term profitable expansion.
While emerging markets have lagged their peers over the last decade, the performance between the two tends to fluctuate over time.
Source: Bloomberg, EMQQ Global