Amazon ads surge 24% to $17.7 billion in Q3 on Prime Video, sports and new AI tools

New Delhi: Amazon’s advertising business grew 24% year-on-year to $17.7 billion in the September quarter. 

CEO Andy Jassy said the momentum is coming from improved targeting, new formats and the integration of advertising with Prime Video and other services. “We’re seeing strong adoption from advertisers as we continue to evolve our ad strategies,” he said on the earnings call.

The company reported net sales of $180.2 billion for the quarter, up 13% from a year ago. Net income rose to $21.2 billion from $9.9 billion, aided by pre-tax gains of $9.5 billion from investments.

Amazon’s ads business now spans placements for sellers and vendors across its shopping surfaces, Prime Video ad inventory, display advertising and a fast-growing demand-side platform. The DSP allows advertisers and media buyers to access inventory across major subscription streaming platforms, including Netflix, Disney+, HBO Max, Paramount+, Peacock, Tubi and Fox One, among others.

Jassy highlighted sports as a key growth pillar. “Live sports got a lot of interest from advertisers in upfront negotiations for 2025–26, and we exceeded our own expectations for upfront commitments with significant growth across the board,” he said. 

He also pointed to new AI capabilities for marketers. “In September, we announced an agentic AI tool and creative studio that plans and executes the entire creative process in a matter of hours instead of weeks.”
Subscription services revenue grew 11% to $12.6 billion. This segment includes Prime membership fees and digital offerings such as video, audiobooks, music and e-books, along with other non-AWS subscriptions.

Amazon Web Services continued to strengthen. Management said AWS growth accelerated and beat estimates, supporting a capital spending plan lifted to $125 billion for the year to expand AI and cloud infrastructure. AWS's operating income reached $11.4 billion, reflecting ongoing investment in data centres and AI capabilities.

For the fourth quarter, Amazon guided net sales to a range of $195 billion to $202 billion and flagged higher infrastructure spending. 

The company’s strong results arrived the same week it announced plans to reduce its workforce by about 14,000 employees, citing the rapid expansion of artificial intelligence. 

In an internal note, the head of HR wrote: “This generation of AI is the most transformative technology we’ve seen since the Internet… We’re convicted that we need to be organised more leanly, with fewer layers and more ownership, to move as quickly as possible for our customers and business.”