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This week: Tech giants post record quarters as Amazon reshapes ad infrastructure

Big Tech earnings exceeded expectations late October while behind-the-scenes infrastructure moves signaled deeper industry realignment than quarterly numbers suggested.

Luis Rijo

• 12 min read
Amazon consolidates ad tech power through DSP partnerships and AWS infrastructure
Amazon consolidates ad tech power through DSP partnerships and AWS infrastructure

Big Tech earnings exceeded expectations late October while behind-the-scenes infrastructure moves signaled deeper industry realignment than quarterly numbers suggested.

The final week of October brought financial disclosures revealing advertising's resilience despite mounting infrastructure costs. Alphabet crossed $100 billion quarterly revenue on October 29, reaching $102.3 billion with advertising contributing $74.2 billion. Meta delivered $50.1 billion in advertising revenue the same day, marking 26% growth despite a $15.93 billion tax charge that reduced net income by 83%. Amazon's advertising business hit $17.7 billion on October 31, growing 22% year-over-year. Microsoft's search advertising climbed 16%, with Bing ad revenue gains outpacing Google's 13% increase according to October 30 earnings calls.

The numbers validated that AI-powered features enhanced rather than cannibalized traditional advertising. Google Search revenues jumped 15% to $56.6 billion, accelerating from prior quarters as AI Overviews and AI Mode drove query growth. Google's Robby Stein told an interviewer on October 31 that SEO for AI Mode overlaps substantially with traditional optimization, emphasizing "the kinds of questions" people ask AI differ from conventional searches. The company insisted Google Ads isn't disappearing despite AI Mode's expansion, addressing industry concerns about advertising's future alongside generative responses.

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But Amazon's October 23 AWS RTB Fabric launch overshadowed even strong earnings. Digiday characterized the infrastructure play as targeting "the rails on which the entire system runs" rather than just advertising transactions. The managed cloud network handles real-time bidding traffic—trillions of bid requests shuttling between ad tech vendors. "With AWS RTB Fabric, we're making it easier for ad tech to work in the cloud," said Stephanie Layser, global head of publisher ad tech solutions at Amazon Web Services.

AWS generates 70% of Amazon's operating income despite representing just 18% of revenue, creating lucrative secondary business from competitors' advertising technology spending. The RTB Fabric service promises single-digit millisecond latency and up to 80% lower networking costs compared to standard cloud rates. AdExchanger noted the launch "marks a strategic countermove against Google Cloud Platform" which spent three years gaining ground among major ad tech companies.

Amazon's dominance extended through partnership consolidation. The company absorbed Microsoft's demand-side platform in a deal announced during Advertising Week New York, with Microsoft Invest sunsetting by March 2026. Advertisers across global markets will migrate into Amazon's ecosystem, receiving preferential inventory access, performance insights tied to retail data, and lower take rates. "That's not just consolidation of clients; it's consolidation of inventory control," Digiday observed October 29.

The Microsoft deal followed partnerships with Roku, Disney, Netflix, Spotify, and SiriusXM, assembling a CTV footprint reaching 80 million U.S. households. Ad buyers told Digiday their Amazon DSP spend increased 12% to 45% this year, driven by costs typically running 10% of intended spend compared to 15% for Google and 20% for The Trade Desk.

Amazon's prominence at Advertising Week exceeded Google and Meta combined, with a dozen scheduled appearances across panels and sessions coinciding with Prime Day. The positioning reflected advertising's upgrade "from a side hustle to a key component" of Amazon's business model, according to Digiday's analysis.

Meanwhile, The Trade Desk faced publisher skepticism over OpenAds and PubDesk launches. The company announced October 16 at Prebid Summit that OpenAds would require Transaction ID sharing, contrasting with Prebid's August decision allowing publishers to opt out. CEO Jeff Green characterized the move as countering "supply-chain shenanigans" and restoring transparency, but publishers questioned whether a wrapper operated by a price-minimizing buyer could benefit price-maximizing sellers.

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AdExchanger reported October 10 that publishers worried about being "anointed (or not)" by The Trade Desk's sell-side projects, citing trauma from earlier OpenPath and S&P500+ initiatives. The company introduced PubDesk providing sellers detailed information on how buyers value inventory, alongside signals flagging bid request tampering by resellers and SSPs.

Streaming platforms demonstrated momentum amid infrastructure battles. Roku posted Q3 results October 31 showing platform revenue exceeding $1 billion for the first time in 2025, growing 17% year-over-year. A remarkable 90% of advertisers using the new Ad Manager tool were new to Roku, while performance marketers from DTC ecommerce, gaming, and mobile apps gained importance. Overall streaming hours increased to 36.5 billion, up 4.5 billion versus last year.

Reddit reached 116 million daily users on October 30, with revenue surging 68% to $585 million. The platform's data licensing agreements with AI companies generated significant revenue while communities became citation sources for large language models. But Adweek reported October 22 that Reddit sued Perplexity and others over data scraping, alleging citations to Reddit increased forty-fold after being told to stop. "AI companies are locked in an arms race for quality human content—and that pressure has fueled an industrial-scale 'data laundering' economy," said Reddit chief legal officer Ben Lee.

The Perplexity conflict highlighted tensions as AI search gained traction. Adweek disclosed October 7 that Perplexity paused accepting new advertisers, with head of publisher partnerships Jessica Chan stating ads aren't currently planned for the Comet browser. The company generated just $20,000 in ad revenue from $34 million total revenue last year, raising questions about monetization viability.

Infrastructure investments accompanying AI capabilities startled investors. Alphabet raised capital expenditure guidance to $91-93 billion for 2025, with Q3 spending hitting $23.953 billion—an 83% surge. Meta's capex reached $19.37 billion in Q3, pushing full-year guidance to $70-72 billion, with CFO Susan Li warning 2026 growth would be "notably larger." Mark Zuckerberg explained the company is "aggressively front-loading infrastructure capacity to prepare for multiple scenarios around when superintelligence might arrive."

Regulatory pressures intensified alongside earnings celebrations. Texas secured a $1.375 billion privacy settlement from Google on November 1, the largest single-state data protection recovery. A federal judge granted summary judgmentOctober 27 binding Google to Virginia court findings on monopolization, clearing paths for private damages claims potentially totaling billions.

Criminal charges were filed against Clearview AI executives October 28 after the company ignored over €100 million in European fines. Privacy advocates noyb escalated from administrative complaints to criminal prosecution, signaling new enforcement phases against companies defying data protection orders.

Search volatility added uncertainty during earnings week. Multiple tracking tools detected ranking fluctuations around October 28, with SEO professionals observing traffic declines coinciding with new ad layout changes. Search Engine Roundtable documented chatter spiking around October 7-8, noting harder confirmation given tool recalibration but suggesting something shifted.

The week also exposed policy changes affecting advertisers. Google updated gambling policy October 28 defining sweepstake casinos as distinct from social casino games, prohibiting them from Google Ads. Google Merchant Center added promotion analytics October 30 showing two charts including "Your promotions at a glance" and "Performance in the last 28 days" for tracking effectiveness.

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Creator economy expansion dominated Advertising Week discussions. Digiday reported October 10 that over 2,000 of 20,000 registrants signed up for creator-related sessions, with four content tracks dedicated to creators—the highest number ever. Rather than simply attending panels, creators hosted brand activations and paid for sessions they organized, staking claims as essential players rather than diversions from traditional advertising.

"What creators were saying to us was, 'we want to be at the top of the funnel, helping companies co-collaborate and co-create the campaigns,'" said Ruth Mortimer, global president of Advertising Week. The shift reflected creators' evolution from campaign participants to strategic partners influencing creative direction from inception.

Meta's automated advertising reached a $60 billion annual run rate, demonstrating AI optimization effectiveness. Ad impressions increased 14% worldwide while average prices rose 10%, suggesting algorithms enabled both volume expansion and value extraction. The platform introduced Advantage+ catalog ads and carousel formats on Threads October 28, expanding creative options for 400 million users. Family daily active people reached 3.54 billion in September, an 8% increase providing expanded inventory.

YouTube sustained particularly strong performance, maintaining its position as leading streaming platform by watch time in U.S. living rooms for over two years. Advertising revenues reached $10.3 billion in Q3, with Shorts achieving higher revenue per watch hour than traditional in-stream ads domestically. The platform's first exclusive NFL broadcast in September drew over 19 million viewers globally.

Cloud businesses drove margin expansion beyond advertising. Google Cloud revenues surged 34% to $15.2 billion with operating margin improving from 17.1% to 23.7%. The division signed more deals exceeding $1 billion through three quarters of 2025 than the previous two years combined. Over 70% of existing customers utilized AI products, with nearly 150 processing approximately 1 trillion tokens each over trailing 12 months.

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Business intelligence platform Monday.com acknowledged October 25 that Google algorithm updates and AI Overviews reduced search traffic affecting SMB customer acquisition. The disclosure represented rare public acknowledgment from a software vendor about search dependency as AI reshapes discovery patterns.

One particularly stark case involved an SEO professional fired as a CEO bet on AI search, resulting in 70% traffic drops within two months. The October 28 report illustrated misunderstandings about how AI search complements rather than replaces traditional SEO, with executives mistakenly assuming optimization for AI responses made Google visibility irrelevant.

Forrester predicted October 28 that 33% of companies will harm customer experiences with premature AI deployment in 2026, while display ad budgets face 30% cuts and privacy lawsuits surge 20%. The research firm cautioned that enthusiasm for AI automation outpaced organizational capability to implement it responsibly.

Retail media developments accelerated during the week. Amazon introduced Reserve Share of Voice for branded search in October, enabling brands to secure Sponsored Brands top-of-search placements through API access at fixed prices. The move acknowledged algorithmic auctions sometimes failed delivering predictable visibility for trademark terms, prompting returns to guaranteed placement models.

Programmatic capabilities expanded through technical integrations. Display & Video 360 API added YouTube and Demand Gen asset management in October, introducing asset creation, AdGroupAd retrieval, and policy review fields. TikTok enabled real-time iOS conversion tracking through Kochava partnership launched October 21, enabling app marketers to access granular conversion insights without SKAN delays.

Streaming industry consolidated as Fubo and Hulu + Live TV completed their merger October 29, forming a vMVPD with nearly 6 million subscribers in North America. Disney gained 70% stake in the combined entity, positioning itself to compete more effectively against YouTube TV and streaming alternatives.

Partnership announcements reflected industry consolidation pressures. Microsoft and OpenAI restructured their partnership October 28, with Microsoft maintaining 27% stake in OpenAI's public benefit corporation. The new agreement extended IP rights through 2032 and introduced an independent AGI verification panel.

Criteo announced plans October 29 to abandon France for Luxembourg, bypassing merger restrictions to clear paths for U.S. acquisition while posting $470 million quarterly revenue. The geographic repositioning suggested consolidation pressures facing mid-tier ad tech companies unable to compete with platform-owned infrastructure.

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Measurement providers addressed cross-media challenges. AudienceProject executive Bruno Furnari outlined prioritiesemphasizing independent cross-media measurement amid fragmentation and AI transformation. LG Ad Solutions integrated ACR data with Databricks Marketplace October 25, providing 33M+ opted-in Smart TV viewership data through Delta Sharing infrastructure.

Privacy frameworks evolved addressing expanding state legislation. IAB Tech Lab opened comment periods through December 1 for Global Privacy Protocol updates, adding four U.S. states. The industry self-regulatory approach aimed creating unified technical standards across fragmenting state-level privacy requirements.

Political advertising received enhanced transparency features. Google expanded its Ads Transparency Center October 29 to include political advertisements, enabling users to search and analyze political campaigns worldwide with spending data and creative details ahead of 2026 U.S. midterm elections.

Adobe announced significant product enhancements supporting content creation. The company expanded GenStudioOctober 28 with Firefly Foundry custom models and advertising platform integrations enabling AI-powered content scaling. Adobe Express introduced conversational AI assistant the same day, enabling creators to design and edit content through natural language interactions.

Pinterest added AI features to boards October 27, introducing personalized tabs, styling tools, and curated boards enhancing shopping and discovery. The updates reflected platforms' emphasis on AI-powered personalization as competitive differentiation.

Mixed reality initiatives gained momentum as Samsung unveiled Galaxy XR October 21, featuring Android XR platform, Gemini AI assistant, and Snapdragon XR2+ Gen 2 processor for $1,799. Google's involvement positioned Android XR as potential challenger to Apple's Vision Pro, creating new computing platforms with eventual advertising implications.

Content rights deals demonstrated exclusive programming value. SiriusXM secured MrBallen podcast in agreement announced October 27, gaining YouTube channel distribution and ad sales rights. The true crime podcast's substantial following made it significant acquisition for SiriusXM's strategy of owning rather than licensing premium content.

Music industry tensions eased slightly as Udio settled copyright litigation with Universal Music Group October 30, disabling downloads as part of licensing agreements. The settlement represented industry-first agreements between AI music generators and rights holders, potentially establishing precedent for similar disputes.

Data platform developments continued apace. Google Search Console introduced query grouping October 28, using AI to group similar search queries helping site owners analyze user intent patterns and traffic trends. Microsoft Clarity added city and state metrics to dashboard cards October 22, enabling regional traffic analysis without filter navigation.

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Technical infrastructure developments continued affecting long-term strategies. Chrome will enforce secure connections by default in October 2026, warning users before accessing sites without HTTPS encryption. The change affects advertising tracking methodologies reliant on unsecured connections, forcing remaining holdouts to complete HTTPS migration.

Cloudflare launched comprehensive TLD tracking on Radar platform October 27, providing analytics for over 1,400 TLDs. The feature introduced DNS Magnitude as ranking metric based on unique client networks querying each domain rather than raw query counts.

Advertising Week served as industry barometer beyond deal announcements. Digiday characterized October 9 the event as distilling "existential drift" as pace of change from AI to global instability to media fracturing caught seasoned marketers off balance. For many of 20,000-plus attendees, the week felt less like Q4's ceremonial kickoff and more like a pulse check.

Industry analyst Karsten Weide attended seeking clarity on whether ad tech maintains handle on bigger pictures or has become "lost in the weeds." Publishers reporting 25-30% traffic decreases created concerns extending beyond publishers to ad tech platforms depending on inventory monetization.

Enterprise adoption patterns suggested widespread AI acceptance influencing advertising approaches. With over 70% of Google Cloud customers utilizing AI products and nearly 150 processing approximately 1 trillion tokens each over trailing 12 months, substantial enterprise spending on AI infrastructure became evident. Marketing technology vendors and agencies may find opportunities helping clients implement similar AI capabilities for customer engagement and content creation workflows.

The week's developments painted an industry at inflection points. Dominant platforms demonstrated remarkable advertising growth while investing unprecedented sums in AI infrastructure. Regulatory pressures intensified across privacy, competition, and consumer protection domains. Third-party publishers and ad tech intermediaries struggled maintaining relevance as platforms consolidated control. AI capabilities advanced rapidly but unevenly, creating both opportunities and risks for early adopters.

For marketers navigating this landscape, several imperatives emerged: diversify beyond single platforms given concentration risks, invest in first-party data capabilities as privacy restrictions tighten, develop AI literacy separating genuine capabilities from hype, maintain measurement rigor as attribution grows more complex, and prepare for continued automation of campaign management functions previously requiring human expertise.

The next earnings cycle in three months will reveal whether massive infrastructure investments deliver promised returns or whether platforms overextended themselves chasing AI leadership. Until then, the industry faces periods of rapid change where adaptability matters more than perfect foresight.

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