Amazon advertising is now worth $2 billion
Shareen Pathak | April 26, 2018
Amazon’s advertising power continues to grow. The Seattle-based e-commerce company reported in its first-quarter 2018 filing that “other” revenue — which it said “primarily includes sales of advertising services” — grew 132 percent year over year to reach $2 billion. In the fourth quarter of 2017, the ad business grew to about $1.7 billion, up about 60 percent year over year. That’s a massive jump for the company, which spent the past quarter making improvements to its advertising offering. Media buyers have reported the company has been running a series of attribution tests to see how its advertising stacks up against the Facebook-Google duopoly and that it’s also been testing application programming interfaces for the Amazon Advertising Platform with a small group of agencies, as it plans to let marketers manage their programmatic campaigns on their own. Speaking on the company’s earning call on April 26, CFO Brian Olsavsky said that “advertising continues to be a bright spot from a product standpoint and a revenue standpoint, and a strong contributor to profitability. It is a multibillion program.” In January, Amazon changed its accounting standards, moving some ad revenue into the “other revenue” line item, which led to, according to Amazon, an increase of $560 million attributed to that line item, the majority of which is ad sales.