Malaysia's digital economy generated RM476.8 billion in gross value added in 2025, equal to 23.5% of the country's gross domestic product, as information technology, e-commerce and digital manufacturing continued to expand.
The combined information and communication technology industry and e-commerce economy grew 5.6%, accelerating from 5.2% a year earlier, according to the Department of Statistics Malaysia's 2025 ICT Satellite Account released on Thursday.
The headline confirms that digital activity represents almost one ringgit in every four generated across the Malaysian economy. It also shows a shift in the composition of growth, with ICT services and manufacturing outpacing the broader e-commerce measure.
Malaysia's Digital Economy Reaches RM476.8 Billion
The RM476.8 billion total was RM25.5 billion higher than the RM451.3 billion recorded for 2024. Its share of GDP edged up from 23.4% to 23.5%.
Those percentages refer to the combined ICT industry and e-commerce economy. The categories overlap, so the separate ICT-industry and e-commerce values should not be added together.
Malaysia's overall economy grew 5.2% in 2025 and reached RM2.03 trillion at current prices, according to DOSM's annual GDP report. Digital activity therefore expanded slightly faster than the economy as a whole.
ICT Services and Manufacturing Lead the Industry
The ICT industry itself generated RM288.1 billion in gross value added. Services were its largest component at 40.3%, followed closely by manufacturing at 38.2%.
ICT services grew 7.6%, while ICT manufacturing expanded 6.4%. Trade accounted for 15.3% of industry value added and content and media supplied the remaining 6.2%.
The services result reflects demand for software, cloud infrastructure, telecommunications and other digital operations. Manufacturing captures Malaysia's position in electronics and technology supply chains, an area also supported by the advanced-chip investment cycle behind TSMC's record profit and 2nm production ramp.
E-Commerce Adds RM267.6 Billion
E-commerce recorded RM267.6 billion in gross value added and represented 13.2% of the economy. It grew 3.7% during 2025.
Manufacturing generated 50.5% of e-commerce value added, although its growth was limited to 1.3%. Services accounted for 47% and accelerated by 7.2%, up from 5.1% in 2024. The remaining share came from other industries.
This breakdown is broader than online retail. DOSM's e-commerce measure includes business-to-business digital transactions across manufacturing and services, which explains why factories account for the largest portion.
ICT Trade Surplus Narrows to RM108.3 Billion
Exports of ICT products rose 14.8% to RM513.6 billion in 2025. Imports increased faster, climbing 24.2% to RM405.3 billion.
Malaysia still recorded an ICT-product trade surplus of RM108.3 billion. The surplus remains substantial, but the faster import growth reduced it from RM119.8 billion in the previous reporting cycle.
The import increase can reflect investment as well as consumption because technology production and data-centre construction require foreign machinery, components and systems. BullBuzz has reported that 27 data-centre projects worth RM225.97 billion had been approved through July 2026.
Jobs Grow More Slowly Than Output
The ICT industry employed 1.27 million people in 2025, or 7.6% of total employment. Employment grew 1.1%, well below the industry's value-added growth.
Manufacturing held the largest employment share at 35.1%, followed by ICT services at 29%, trade at 23.4%, and content and media at 12.5%.
The gap between output and employment growth may point to improving productivity and the capital-intensive nature of digital infrastructure. It also sharpens the policy question of whether investment produces higher-skilled, higher-paid local work alongside headline GDP gains.
Infrastructure and Skills Become the Next Test
The latest figures arrive as Malaysia invests in AI, cloud computing and digital skills. The Digital Ministry's Budget 2027 programme includes support for 4,000 small and medium-sized businesses adopting AI and training for 5,000 AI professionals.
Growth also carries infrastructure costs. Malaysia has told data-centre developers to fund transmission upgrades triggered by their projects and pay for reserved electricity capacity. BullBuzz's report on the new power-grid rule explains how the government plans to protect existing users as large campuses connect.
The RM476.8 billion result establishes the scale of Malaysia's digital economy. The next test is whether faster output translates into stronger productivity, skilled employment, local supply-chain participation and infrastructure that can support another stage of growth.
Banner: The Department of Statistics Malaysia entrance in Putrajaya. The photograph identifies the agency that released the ICT Satellite Account 2025.