The Interactive Advertising Bureau today released its 2025 Internet Advertising Revenue Report, conducted by PwC, confirming that US digital advertising revenue reached $294.6 billion last year - a 13.9% year-over-year increase and a record for the industry. The report, first issued in 1996 and now in its 30th year, serves as the sector's primary benchmark for tracking where advertising dollars flow across the digital ecosystem.

The headline figure is significant not only for its size but for when it was achieved. According to the IAB, the gains were "notable" given that 2025 lacked major cyclical events such as the Olympics, FIFA World Cup, or elections - occasions that historically inject considerable incremental spend into the digital advertising market. The industry grew by roughly $36 billion in a year without those tailwinds.

Social media emerged as the single largest driver of that growth. Revenue from social advertising reached $117.7 billion in 2025, up 32.6% year-over-year and equivalent to an additional $29 billion flowing into the channel. That figure now represents 40% of total digital advertising revenue in the United States, according to the IAB. Three forces drove the expansion: the scaling of the creator economy, deeper integration of commerce functionality within social platforms, and continued improvements in targeting, measurement, and attribution capabilities.

Search holds volume but loses momentum

Search advertising remains the largest category by absolute revenue, reaching $114.2 billion in 2025 and capturing 38.8% of total digital ad spend. Growth came in at 11% year-over-year. That is a meaningful deceleration. According to the IAB's report, search grew 15.9% in 2024, meaning the 2025 rate represents a considerable slowdown even as the category - which the IAB defines as inclusive of AI search - still added substantial dollars in absolute terms.

The contrast between search's 11% growth and social's 32.6% growth tells a structural story about where incremental investment is moving. Search is not shrinking, but the share of new money entering the market is increasingly heading toward video, social formats, and commerce media rather than traditional keyword-based placements.

Video's 25.4% expansion reaches $78 billion

Digital video delivered the sharpest growth rate among the major format categories, rising 25.4% year-over-year to reach $78 billion in total revenue. That acceleration is notable when compared to the prior year: in 2024, the same category grew 19.2%. According to the IAB, video's share of incremental digital advertising revenue - not just its base share - continues to expand relative to other formats.

The category encompasses connected TV (CTV), social video, online video, and short-form video. Consumer behavior has continued shifting toward these formats, and according to the IAB, the structural changes to viewing patterns are reflected directly in where budgets are moving. Streaming platforms have invested aggressively in live sports rights and real-time event coverage while expanding ad-supported tiers, which the report identifies as creating more premium inventory and intensifying competition for video advertising budgets.

At $78 billion and 26.5% of total digital ad revenue, video now rivals search in its share of the overall market - a structural rebalancing that would have seemed unlikely even three years ago.

Commerce media crosses $63 billion

Commerce media - advertising that occurs within or adjacent to commerce environments, powered by first-party data from retailers and other transaction-rich platforms - grew 18% year-over-year to reach $63.4 billion. That places the category at 21.5% of total digital advertising revenue.

The IAB report characterizes commerce media as a "core performance channel," noting that its growth is underpinned by access to first-party transaction data - a structural advantage that has become more valuable as third-party identifiers erode. According to Jack Koch, SVP of Research & Insights at IAB, "the ability to integrate data, media, and commerce is becoming a defining advantage: companies that can provide seamless, personalized, and commerce-enabled experiences are where the attention and investment are moving."

For context on how rapidly this category has risen, commerce media was already being discussed as a defining trend in 2024, when it generated $53.7 billion - the jump to $63.4 billion represents more than $9 billion in new spend in a single year.

Display and podcasts

Display advertising grew 9.8% to $81.6 billion, taking 27.7% of total media spend. The category's growth rate was the slowest among the major formats, suggesting that while display budgets continue expanding in absolute terms, they are losing relative share to video and social formats.

Podcast advertising reached $2.9 billion in 2025, up 17.6% year-over-year. The category accounts for 1% of total digital ad spend. That percentage understates the rate of investment concentration in audio content - 17.6% growth in a market segment that lacks the scale of search or social indicates sustained directional interest from advertisers.

Programmatic crosses $162 billion

One of the most structurally significant data points in the report is the performance of programmatic advertising. According to the IAB, programmatic rose 20.5% year-over-year to reach $162.4 billion - adding $27.6 billion in new spend over the course of 2025 as automated buying systems continue to scale.

That $162.4 billion figure represents a market more than double the size of total US digital advertising just a decade ago. The IAB frames the growth as not merely cyclical but architectural: automated buying at scale, the report suggests, is laying the groundwork for agentic AI-driven media buying. The framing connects the current programmatic trajectory to the next stage of infrastructure development, in which AI agents - rather than human traders operating within DSP interfaces - execute campaign decisions autonomously.

This is not a distant forecast. IAB Tech Lab's Agentic Advertising Management Protocols (AAMP) were formally named and structured in February 2026, and practical demonstrations of agentic campaigns at production scale have already taken place. PubMatic and Butler/Till ran a live agentic campaign in December 2025 using a Claude-based agent communicating with PubMatic's AgenticOS infrastructure, producing 40% more impressions than comparable non-agentic activity.

Creator advertising becomes a core channel

Perhaps the most consequential category shift documented in the report is the formalization of creator advertising as a distinct, measurable media channel. According to the IAB, creator advertising spend reached $37 billion in 2025 - growing faster than the broader advertising market. Projections in the report put creator spend at $44 billion in 2026.

The IAB's characterization of this shift is precise. What was once campaign-based influencer marketing is evolving into always-on creator programs. Brands are embedding creators into long-term media strategies, operational workflows, and in some cases product development. Dedicated teams and purpose-built tools now manage creator partnerships at scale. This is a different operating model from the one-off sponsorship arrangements that characterized early influencer marketing.

The creator economy's move toward more structural roles in brand marketing has been visible across multiple dimensions since at least 2025, and the IAB data now attaches a dollar figure to that transition. At $37 billion, creator advertising is larger than podcast, audio, and several other established digital categories combined.

Platform concentration continues

The report notes a structural pattern that runs beneath the category-level numbers: consolidation among scaled platforms. According to the IAB, the top 10 global media companies continue to hold the majority of internet advertising revenue share. The structural advantages these companies possess - deeper first-party data pools, integrated commerce ecosystems, proprietary measurement infrastructure, and end-to-end buying environments - are difficult for buyers to overlook or circumvent.

"While overall revenue is stronger than ever, consumer usage patterns have changed materially over the last year," said Jack Koch of IAB. "The ability to integrate data, media, and commerce is becoming a defining advantage."

This concentration has been a recurring point of discussion within the industry. A founding IAB member criticized the organization's 2026 conference agenda in January for failing to address publisher revenue challenges even as scaled platforms captured a growing share of the $294.6 billion total. The gap between total market growth and publisher-level revenue capture is not addressed directly in the IAB revenue report, but the platform concentration data is consistent with the concern.

AI as infrastructure, not experiment

David Cohen, CEO of IAB, framed the results explicitly around a shift in how the market operates. "This revenue growth reflects a market that has reoriented around performance channels. As expectations for measurable outcomes rise, investment is concentrating in areas that can directly correlate spend to business results," Cohen said. "At the same time, artificial intelligence is rapidly moving from theory into practice, emerging as a meaningful driver of efficiency and effectiveness across the ecosystem."

The report positions AI as advertising's emerging infrastructure layer - redefining discovery, creative production, campaign execution, and monetization. Specifically, the IAB document notes that AI is redefining the entire value chain, including agent-based buying and selling, AI-driven creative production, and AI-mediated commerce interactions with both human consumers and automated agents.

This framing aligns with a body of work the IAB and IAB Tech Lab have been building throughout the past 18 months. IAB's 2026 Outlook Study, released in January, projected 9.5% US advertising spend growth for 2026 with five of six top advertiser priorities linked to AI adoption. IAB Tech Lab's agentic AI roadmap, announced in January 2026, outlined a strategy for extending OpenRTB, AdCOM, VAST, and other existing standards with modern agentic execution protocols rather than replacing them.

The programmatic advertising figure - $162.4 billion and growing at 20.5% - is where these two narratives intersect. That market is the foundation on which agentic buying will be built.

Measurement and standards for the next 30 years

Cohen also addressed what he described as the lesson from the IAB's three decades of operation. "The lesson of our 30-year history is that measurement, standards, and interoperability - as mundane as those things can sometimes sound - are what got this industry from zero to just shy of $300 billion," he said. "And with the disruption and opportunity that AI is bringing into the ecosystem, there is still lots of vital work ahead."

The IAB has launched Project Eidos to address the structural issues in measurement across the industry. According to the announcement, the initiative is focused on defining principles, standards, and frameworks that guide how measurement is developed, evaluated, and compared - rather than introducing channel-specific workarounds or temporary fixes.

In combination with IAB Tech Lab's AAMP initiative, Project Eidos forms part of what the IAB describes as preparation for the industry's next 30 years of growth.

The 2025 Internet Advertising Revenue Report was commissioned by the IAB and conducted by PwC Advisory Services LLC on an ongoing basis. Data is reported directly to PwC from companies selling advertising on the internet, as well as sourced from publicly available corporate filings. PwC does not audit the information and provides no opinion or other form of assurance. Individual company data is held in strict confidence; only aggregate results are published. Experts from IAB, PwC, and Madison & Wall are scheduled to discuss findings during a webinar on April 21 at 1 pm ET.

Timeline

Summary

Who: The Interactive Advertising Bureau (IAB), in conjunction with PwC Advisory Services LLC, released the findings. David Cohen serves as CEO of IAB. Jack Koch is SVP of Research & Insights at IAB. The report draws on data submitted directly by companies selling advertising on the internet across the United States.

What: Total US digital advertising revenue reached $294.6 billion in 2025, a 13.9% year-over-year increase. Social media led all categories with $117.7 billion and 32.6% growth. Search reached $114.2 billion but grew at a slower 11% rate. Digital video rose 25.4% to $78 billion. Commerce media grew 18% to $63.4 billion. Programmatic advertising crossed $162.4 billion, rising 20.5%. Creator advertising spend reached $37 billion. Display grew 9.8% to $81.6 billion, and podcast advertising reached $2.9 billion.

When: The 2025 Internet Advertising Revenue Report was released on April 16, 2026. The data covers the full calendar year 2025.

Where: The report covers the United States digital advertising market across websites, commercial online services, ad networks and exchanges, mobile devices, email providers, and other companies selling online advertising. The IAB is headquartered in New York City.

Why: The report serves as the industry's primary benchmark for tracking digital advertising revenue, first published in 1996. The 2025 results are significant because the growth was achieved without major cyclical events such as the Olympics, FIFA World Cup, or elections - all of which historically drive incremental ad spend - making the $36 billion year-over-year increase an organic reflection of structural shifts toward performance channels, video consumption, creator-led content, and automated buying systems.

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