Amazon advertising revenue jumps 22% to $15.7 billion in Q2 2025

Amazon reported advertising services revenue of $15.7 billion for the second quarter of 2025, according to financial results announced July 31, 2025. This represents a 22% increase compared to the same period in 2024, significantly outpacing the company's overall revenue growth of 13% year-over-year.

The advertising business demonstrated robust momentum across multiple channels during the quarter ended June 30, 2025. Amazon's advertising growth continued to accelerate, building on the 19% increase reported in the first quarter when revenue reached $13.9 billion.

Full-funnel strategy drives advertiser demand

Amazon's advertising success stems from its comprehensive approach to connecting brands with consumers across the digital ecosystem. CEO Andy Jassy emphasized this strategy during the second quarter earnings call, noting the platform's unique position in the market.

"We continue to see strength across our broad portfolio of full funnel advertising offerings that in The US alone help advertisers reach an average ad support audience of more than 300,000,000 across our own properties," Jassy said during the July 31 earnings call.

The company's advertising inventory spans Amazon's retail marketplace, Prime Video, Twitch, Fire TV, and live sports programming including NFL, NASCAR, and NBA content. This diverse portfolio enables advertisers to reach consumers across multiple touchpoints with increasingly sophisticated targeting capabilities.

Amazon's advertising reach extends beyond owned properties through strategic partnerships and third-party publisher networks. The company leverages its Amazon Demand Side Platform (DSP) to deliver advertising solutions across the broader digital landscape.

Strategic partnerships expand Connected TV reach

Amazon strengthened its position in Connected TV advertising through two significant partnerships announced during the quarter. In June 2025, Amazon and Roku unveiled an exclusive partnership creating the largest authenticated Connected TV footprint available to advertisers in the United States.

"It's a giant leap forward for advertisers bringing best in class planning, audience precision, and performance to TV advertising," Jassy explained during the earnings call, referring to the Roku integration through Amazon DSP.

The partnership provides access to an estimated 80 million Connected TV households through Amazon DSP, representing more than 80% of all CTV households according to ComScore data. The exclusive integration becomes available to all Amazon DSP advertisers beginning in the fourth quarter of 2025.

Amazon also announced an integration with Disney's Real-Time Ad Exchange in June 2025, providing advertisers direct access to premium inventory across Disney+, ESPN, and Hulu platforms. The collaboration enables curated deal packages and leverages Disney's Magic Words contextual targeting technology alongside Amazon's commerce insights.

"This collaboration allows advertisers to gain direct access to Disney's premium inventory across platforms like Disney plus, ESPN, and Hulu, while allowing them to leverage insights from both companies," Jassy noted during the call.

AI technology enhances advertising effectiveness

Amazon's substantial investments in artificial intelligence are yielding measurable benefits for its advertising business. The company's AI-powered tools optimize campaign performance while reducing operational complexity for advertisers.

During the quarter, Amazon expanded access to its Nova foundation models within Bedrock, including Nova Act which simplifies agent creation for automated website actions. The company also introduced Strands, an open source tool that enables developers to build AI agents more easily.

"When advertisers work with Amazon, they're not just buying ad space. They're benefiting from exceptional programming, innovative technology, and unrivaled signals, measurement, and audience development that provides strong relevancy for consumers and return on investment for brands," Jassy said.

Amazon's AI capabilities span multiple aspects of advertising delivery, from targeting optimization to creative enhancement. The company's vast first-party data ecosystem, combined with advanced machine learning models, creates competitive advantages in audience identification and campaign optimization.

Premium content drives advertiser engagement

Amazon's investment in premium content continues to attract advertiser interest across multiple properties. The company's live sports programming generated significant viewer engagement during the second quarter.

Prime Video's NASCAR Cup Series coverage drew approximately 2 million viewers per race and attracted the youngest audience among NASCAR broadcasters in more than a decade. Amazon also announced its stellar broadcasting team for the upcoming NBA season, including prominent personalities like Stan Van Gundy, Kevin Harlan, and Dwyane Wade.

The company's content strategy extends beyond sports to include high-profile entertainment projects. Amazon announced Denis Villeneuve as director of the next James Bond film, demonstrating its commitment to premium content that attracts both viewers and advertising investment.

DSP platform gains industry recognition

Amazon's programmatic advertising capabilities received additional validation through expanded partnerships and industry certifications. The Amazon DSP platform now enables advertisers to access premium inventory across multiple streaming platforms through unified campaign management interfaces.

The platform's measurement capabilities have gained Media Rating Council accreditation for key metrics including display impressions and click-through rates across third-party exchanges and Fire TV environments. This certification provides advertisers with industry-standard assurance regarding data accuracy and campaign performance measurement.

"Our trillions of proprietary browsing, shopping, and streaming signals paired with extensive supply side relationships and our secure clean rooms provide advertisers the ability to optimize advertising, deliver greater precision, and drive efficient and effective advertising outcomes," Jassy explained.

Financial performance strengthens across segments

Amazon's advertising revenue growth contributed significantly to the company's overall financial performance during the second quarter. Operating income increased 31% year-over-year to reach $19.2 billion, with advertising serving as an important profitability driver across both North America and international segments.

The North America segment, which includes the majority of Amazon's advertising business, generated operating income of $7.5 billion compared to $5.1 billion in the second quarter of 2024. International segment operating income reached $1.5 billion, up from $0.3 billion in the prior year period.

Amazon's advertising growth trajectory positions the business as a significant competitive force in the digital advertising market. The company competes directly with Google and Meta for advertising expenditures while offering unique advantages through its e-commerce integration and cross-platform reach.

Market position strengthens amid competition

Amazon's advertising business has emerged as the third-largest digital advertising platform, trailing Meta and Alphabet. The company's 22% growth rate in the second quarter compares favorably with Meta's 22% advertising revenue growth and Google's 10% advertising sales increase during the same period.

The company's position at the intersection of e-commerce and advertising provides distinct advantages in attribution and return on ad spend measurement. Unlike many digital advertising platforms, Amazon can directly connect ad impressions to purchases within its ecosystem, offering advertisers clearer performance metrics.

Amazon's expanding streaming content portfolio, audio offerings, and third-party publisher network create multiple growth vectors that help insulate the advertising business from potential disruptions in any single channel.

Industry outlook remains positive

Looking ahead to the third quarter of 2025, Amazon provided guidance projecting net sales between $174.0 billion and $179.5 billion, representing growth between 10% and 13% compared to the third quarter of 2024. While the company does not provide specific advertising revenue projections, the segment's consistent growth trajectory suggests continued expansion.

Several factors support continued advertising growth in coming quarters. Amazon's investments in AI capabilities should enhance value propositions for advertisers, potentially driving higher spending per customer. The ongoing expansion of ad inventory across streaming content and third-party networks presents clear growth opportunities.

The Connected TV market continues expanding rapidly, with industry projections showing CTV's share of media budgets doubling from 14% in 2023 to 28% in 2025. Amazon's strategic partnerships position the company to capture significant portions of this growing investment.

Amazon's advertising success reflects broader industry trends toward privacy-compliant targeting, first-party data utilization, and performance-driven campaign optimization. The company's comprehensive data ecosystem and cross-platform measurement capabilities align with advertiser demands for accountability and return on investment.

Key Terms Explained

Amazon DSP (Demand Side Platform): Amazon's programmatic advertising platform that enables advertisers to purchase display, video, and audio advertising across Amazon's owned properties and third-party publisher networks. The platform leverages Amazon's vast first-party data to provide sophisticated targeting capabilities and measurement solutions. Amazon DSP serves as the technical backbone for many of the company's strategic partnerships, including the exclusive integrations with Roku and Disney announced during Q2 2025.

Connected TV (CTV): Digital streaming television content delivered over internet-connected devices such as smart TVs, streaming boxes, and gaming consoles. Connected TV represents one of the fastest-growing segments in digital advertising, with industry projections showing CTV's share of media budgets doubling from 14% in 2023 to 28% in 2025. Amazon's strategic focus on CTV advertising through partnerships and Prime Video inventory positions the company to capture significant portions of this expanding market.

Advertising Revenue: The total income generated by Amazon from advertising services across all platforms and properties during a specific period. For Q2 2025, Amazon reported advertising services revenue of $15.7 billion, representing a 22% year-over-year increase. This revenue stream includes sponsored product ads, display advertising, video advertising, and programmatic advertising delivered through Amazon DSP across owned and third-party properties.

Full-Funnel Advertising: A comprehensive marketing approach that targets consumers at every stage of the purchase journey, from initial awareness through final conversion and retention. Amazon's full-funnel strategy leverages multiple touchpoints including retail marketplace ads, streaming video content, live sports programming, and third-party publisher networks to create cohesive advertising experiences that drive both brand awareness and direct response outcomes.

Prime Video: Amazon's streaming video service that has become a significant advertising inventory source following the introduction of ad-supported tiers. Prime Video's advertising opportunities include traditional video ads, live sports programming such as NFL and NASCAR coverage, and premium content including the upcoming James Bond film. The platform's integration with Amazon's broader advertising ecosystem enables sophisticated audience targeting and cross-platform measurement capabilities.

Artificial Intelligence (AI): Advanced computing technologies that Amazon employs across its advertising platform to optimize campaign performance, enhance targeting precision, and automate complex advertising operations. Amazon's AI investments include Nova foundation models within Bedrock, Strands for agent development, and machine learning systems that process trillions of browsing, shopping, and streaming signals to improve advertising effectiveness and return on investment for brands.

Year-over-Year Growth: A comparative financial metric that measures the percentage change in advertising revenue between the same period in consecutive years. Amazon's 22% year-over-year growth in Q2 2025 advertising revenue significantly outpaced the company's overall revenue growth of 13%, demonstrating advertising's expanding importance within Amazon's business portfolio and its competitive position against other digital advertising platforms.

Operating Income: The profit generated from Amazon's core business operations after subtracting operating expenses but before interest and taxes. Amazon's total operating income reached $19.2 billion in Q2 2025, with advertising serving as an important contributor to profitability across both North America and international segments. The advertising business's high-margin characteristics make it particularly valuable for overall company financial performance.

Programmatic Advertising: Automated buying and selling of digital advertising inventory through real-time bidding systems and demand-side platforms. Amazon's programmatic capabilities through Amazon DSP enable advertisers to access premium inventory across multiple platforms including Roku, Disney properties, and third-party publisher networks. This approach provides greater efficiency, targeting precision, and campaign optimization compared to traditional manual advertising purchases.

Market Position: Amazon's competitive standing within the digital advertising industry relative to other major platforms such as Google and Meta. As the third-largest digital advertising platform, Amazon's unique advantages include direct integration with e-commerce transactions, first-party shopping data, and the ability to measure advertising impact on actual purchase behavior. This position enables Amazon to compete effectively for advertising budgets while offering distinct value propositions that differentiate it from search and social media platforms.

Timeline

• July 31, 2025: Amazon announces Q2 2025 earnings with $15.7 billion advertising revenue, 22% year-over-year growth
• June 16, 2025: Amazon and Roku announce exclusive Connected TV partnership providing access to 80 million U.S. households
• June 17, 2025: Disney's Real-Time Ad Exchange integrates with Amazon DSP for premium streaming inventory access
• May 1, 2025: Amazon reports Q1 advertising revenue of $13.9 billion, up 19% year-over-year
• February 6, 2025: Amazon's Q4 2024 advertising revenue reaches $17.3 billion with 18% growth

Summary

Who: Amazon.com Inc. (NASDAQ: AMZN), led by CEO Andy Jassy and CFO Brian Lisowski, reported second quarter 2025 financial results with significant advertising revenue growth.

What: Amazon's advertising services revenue reached $15.7 billion in Q2 2025, representing a 22% increase compared to the same period in 2024, driven by expanded Connected TV partnerships, AI-powered optimization tools, and premium content offerings across retail and streaming platforms.

When: The financial results were announced on July 31, 2025, covering the quarter ended June 30, 2025, with major partnership announcements occurring in June 2025.

Where: The advertising growth spans Amazon's global operations, with particular strength in the United States market through partnerships providing access to 80 million Connected TV households and premium streaming inventory across Disney+, ESPN, and Hulu.

Why: Strong performance reflects Amazon's successful full-funnel advertising strategy, strategic Connected TV partnerships with Roku and Disney, AI-powered campaign optimization capabilities, premium content investments in sports and entertainment, and the company's unique position connecting advertising directly to commerce outcomes within its ecosystem.