Amazon Ads jumps 23% in Q4 to $21.3 billion as marketing spends rise

New Delhi: Amazon’s advertising business, reported as “Advertising services”, grew 23 per cent year-on-year to $21.317 billion in the December quarter, reinforcing the company’s push to deepen monetisation from brands, sellers and publishers, even as its sales and marketing spends rose and international margins tightened.

Amazon said Q4 net sales increased 14 per cent to $213.4 billion, while operating income rose to $25.0 billion.

Advertising revenue growth outstripped Amazon’s overall topline growth in the quarter.

In its earnings commentary, CEO Andy Jassy also clubbed advertising with the company’s faster-moving engines, saying: “Advertising growing 22%”.

“Advertising services” includes sales of advertising services to “sellers, vendors, publishers, authors, and others”, through programmes such as “sponsored ads, display, and video advertising”.

While Amazon does not break out India ad revenue or India marketing spends in its quarterly release, the company did flag a fast-delivery push, with India named as a key market.

It said it expanded Amazon Now ultra-fast delivery, offering delivery on thousands of items in 30 minutes or less, and added that Amazon Now is now available in various cities in India, Mexico and the UAE.

This matters for brand and performance marketers because quick-delivery models typically intensify competition in high-frequency categories, where search and retail media placements are bid up by brands chasing “in-the-moment” conversions.

Amazon did not provide India-specific benchmarks, but the India mention signals that the company is pushing deeper into speed-led commerce propositions locally.

On the cost side, Amazon’s “Sales and marketing” expense rose to $14.264 billion in Q4 2025 from $13.124 billion in Q4 2024. For the full year, the line increased to $47.129 billion from $43.907 billion.

While international net sales rose 17 per cent year-on-year to $50.7 billion in Q4, international segment operating income declined to $1.0 billion from $1.3 billion a year ago.

In the segment metrics, the international operating margin fell to 2.1 per cent in Q4 2025 from 3.0 per cent in Q4 2024.

The margin compression, despite higher sales, indicates elevated costs and competitive pressure in international markets—an environment where platforms often push harder on performance levers, including seller-funded advertising, to protect profitability.

Jassy said Amazon expects to invest about $200 billion in capital expenditures across Amazon in 2026.

Amazon’s rising sales and marketing cost line, along with international margin pressure and large restructuring-related charges, point to a business still absorbing heavy growth and investment costs.