Amazon Advertising: a $10bn business

February 5, 2019 by
Nico Hoeijmans

Amazon USA

American marketplace Amazon has published its results for the fourth quarter of 2018. In Q4, sales are up 20%, to $72.4 billion. A massive growth can be seen for Amazon Advertising - over the year 2018, net sales increased 31% ($232.9 billion). Net income increased to $10.1 billion, compared with net income of $3.0 billion in 2017. For the first quarter of 2019, Amazon expects growth between 10% and 18% compared to the same quarter in 2018.

Interesting to see is the Amazon Advertising area. This includes Amazon Sponsored Ads, Sponsored Brands, Display Ads and Amazon demand-side platform. Growth in Amazon ads has slowed to 95% year on year, but still showed an increase in spending of $830 million compared to Q3 2018. It is also an increase of $1,653 million compared to Q4 2017. A bigger perspective shows that this is an increase of $1.7 billion for the peak quarter. With 95% growth, Amazon Advertising is almost doubling year on year. As the business matures, triple-digit acceleration would be almost impossible to maintain. The $10.1bn revenue on ads for the full 2018 year shows the huge importance of Amazon Advertisings for merchants.

 

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