EP-124: Big Tech’s Billion Dollar Gamble on AI Gets Bigger in 2025

Microsoft has transformed the world of quantum computing and artificial intelligence (AI).

With the launch of Majorana 1 chip — touted as a breakthrough material and the world’s first Quantum Processing Unit (QPU) — quantum computers will now be “capable of solving meaningful, industrial-scale problems in years, not decades.”

It’s not just an incremental upgrade but a game-changer.

Majorana 1 chip is designed to handle the computational demands of increasingly sophisticated AI models. With such innovations, Microsoft aims to provide a critical foundation for AI companies, paving the way for more accessible and scalable applications across industries.

Microsoft's move gives a peek into how the race to create the most intelligent AI is shaping up.

Big tech players are upping their stakes, and Microsoft's new Majorana 1 chip is just the beginning.

In 2025, giants like Meta, Microsoft, Amazon, and Google's parent Alphabet are set to invest US$325 billion into capital expenditures and investments to develop AI infrastructure. This marks a 46% leap from the US$223 billion they spent in 2024.

The lion's share of this investment will focus on the construction of high-power data centers, bolstering machine learning capabilities, and massively scaling AI tools.

The 2025 investment surge highlights how these companies are not just thinking about AI’s potential but are acting decisively to make it a central part of their operations.

But this isn't just a race between American tech titans.

Global competitors are ramping up their own AI investments, with Chinese tech giant Alibaba leading the charge. Alibaba has pledged over US$52 billion to build out AI infrastructure in the course of three years. This includes developing cutting-edge AI chips and expanding its cloud services to enhance machine learning and data analytics capabilities.

With such an aggressive commitment, Alibaba aims to cement its role as a key player in the future of AI, positioning itself as an alternative to Western tech giants while competing on the global stage.

The Chinese government has also put its weight behind AI advancements, with Beijing establishing a US$13.7 billion fund dedicated to AI and robotics. The fund, which has a lifespan of 15 years, will help drive both private sector innovation and government-led initiatives to create embodied AI (integrating AI into robots) and develop AI chips. Similarly, the city of Shenzhen, which is known for being the technology hub in China, has set up a US$1.4 billion industry fund to invest in AI and robotics.

Such private and public alignments underscore China’s long-term strategy to be a dominant force in the global AI space.

This week, Malaysia struck a 10-year deal worth US$250 million with British chip giant Arm Holdings to produce high-end GPU chips in the country. The deal, which includes training 10,000 engineers in Malaysia, will help the country create 10 local chip companies with a yearly revenue of US$1.5-2 billion each.?

This strategic move builds directly on Malaysia's recent momentum of receiving maximum investment from big tech firms to build data centers.

With Asian countries increasingly looking to leverage AI for economic development, these big investments are poised to create ripple effects across the market.

Southeast Asia’s rapidly growing tech ecosystem can tap into the global AI infrastructure being built by companies like Meta, Microsoft, Amazon, and Google, fostering innovation and enhancing local industries such as e-commerce, manufacturing, and healthcare.

Furthermore, the growing presence of AI-powered services will drive job creation, especially in fields like data science, machine learning, and cloud computing.

Countries such as Singapore, Malaysia, Vietnam, and Indonesia are already establishing themselves as hubs for AI innovation, and the continued investment from big tech will only accelerate their progress.

With billions in play and Southeast Asia positioned as a key beneficiary, the future of AI looks more exciting and accessible than ever before.

On that note, let’s dive into this week’s recap.

Buzzing Deals

?? Malaysian healthcare startup PMG Healthcare has secured US$16.6 million in a funding round led by Singaporean venture fund Ikhlas Capital. This funding will allow the company to expand its core healthcare services across Malaysia and upgrade its facilities. Founded in 2012, PMG Healthcare has 188 centers in Malaysia, which include pharmacies, clinics, and dental clinics.

? Chinese medical devices manufacturer Pulnovo Medical has raised US$100 million in a series C round of funding that was co-led by Qiming Capital and Lilly Asia Ventures, along with the participation of OrbiMed and Gaorong Capital. This funding will support Pulnovo’s two upcoming FDA trials planned this year. Founded in 2013, Pulnovo focuses on developing therapeutic solutions for various stages of pulmonary hypertension.

? Vietnamese healthcare company FDCare has received US$2.5 million in a Series A round of funding co-led by US-based Cercano Management and Singaporean VC firm Golden Gate Ventures. Its existing investors, Center Back Capital and AiViet Venture, also participated in this round. The company will utilize the fresh capital to expand its chain of clinics across Vietnam and add new services like corporate health checks, mental wellness, and others. Formerly known as Helicare, FDCare provides comprehensive primary care, integrating preventive screening, personalized consultation, chronic disease management, and end-of-life care.

? Singapore-based Morpheus Labs has raised US$430,000 in its pre-Series A funding round from Ficus Capital, a Malaysia-based Islamic-compliant venture capital firm. Startup Five Investment, which focuses on ESG and Web3 startups, also participated in this round. Morpheus Labs simplifies Web3 Implementation for businesses and developers. The latest capital infusion will help the company accelerate innovation in simplifying blockchain implementation, making it easier for businesses and developers to build, deploy, and manage decentralized applications.

? Vietnam-based edtech startup NPX Point Avenue has received an undisclosed amount of funding from Hong Kong-based PE firm Gaw Capital Partners. This funding makes Gaw Capital the majority shareholder in NPX. The latest funding will allow the company to expand its operations. NPX operates its K -12 school in Hanoi as well as Point Avenue, an after-school center.

? Malaysia-based Arus Oil has received an undisclosed amount of funding from 1337 Ventures via its Accelerator Fund I. Founded in 2017, Arus Oil focuses on transforming waste into renewable energy, which includes converting used cooking oil into biodiesel. The funding will help the company launch new drop-off centers for used cooking oil in Subang and create new fintech partnerships.

What Stood Out This Week

? Singapore-based superapp Grab Holdings Limited has acquired supermarket chain Everrise from Malaysia-based private equity firm Navis Capital Partners. The companies didn’t disclose the deal value. This acquisition, which comes three years after Grab bought Malaysian retail chain Jaya Grocer, is part of the company's push to grow its grocery business. Everrise is one of the largest premium grocery chains, operating 19 outlets in East Malaysia.

? Saigon Asset Management (SAM) plans to raise a US$300-million fund that will see its first close in Q4 2025. The fund will go toward the development of data centre projects across Vietnam. The company will invest the majority of its capital in SAM DigitalHub, a data centre project it has launched in partnership with Vietnam Singapore Industrial Park (VSIP). SAM DigitalHub will be a 150-megawatt data center campus spread across 124 acres, with a targeted investment of up to US$1.5 billion.

? Singapore-headquartered tech conglomerate SEA Limited posted a revenue of US$16.8 billion in 2024, up 28.8% year-on-year. The company said its e-commerce revenue grew by 38% to US$12.4 billion for the same period. The firm’s total net income for 2024 was US$447.8 million, compared to a total net income of US$162.7 million in the previous year. Its total adjusted EBITDA jumped to US$2 billion from US$1.2 billion a year ago.?

? Vietnamese conglomerate Vingroup has entered into an agreement with JTA Investment Qatar for a potential equity investment of US$1 billion in VinFast, the electric vehicle (EV) firm founded by Vingroup. The MOU signed by the two parties mentions JTA Investment Qatar's interest in making strategic investments in Vingroup’s core business sectors.

And that’s the wrap for this edition of #ICYMI, our weekly curated highlights from the Asian tech ecosystem. Subscribe to receive it every Thursday and stay updated on the noteworthy tech developments you might have missed during the week. Like this newsletter? Share it with your friends and colleagues here.