Observed Signal · Feb 5, 2026 · Earnings Report · Source: Feedspot/RSS · Impact: 4/5 · Sentiment: Positive
Amazon's Ad Revenue Soars, But Capex Worries Investors
Amazon reported strong fourth-quarter results with record net sales and continued growth in its advertising business, but flagged much higher capital expenditures for 2026. In Q4 Amazon recorded $213.4 billion in net sales (up 12% year-over-year, excluding FX) and $21.3 billion in advertising revenue, a 22% year-over-year increase. The company generated $68 billion in ad revenue in 2025. AWS posted $35.5 billion in third-quarter revenue, up 24% year-over-year, representing a $142 billion annual run rate (up from $132 billion in the prior quarter). Amazon said it plans $200 billion in capital expenditures for 2026, well above analysts’ expectations of $146 billion. The company noted record holiday sales and limited consumer-impact from tariffs, inflation, or weaker spending.
Amazon is a major commerce and ad platform; its accelerating ad revenue and large capex guidance materially affect retail media, CTV inventory and market dynamics—making the earnings and capex outlook important for the AdTech industry.
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Key Takeaways & Evidence Grounding
- Amazon reported $213.4 billion in net sales in Q4, up 12% year-over-year excluding foreign exchange changes.
- Amazon generated $21.3 billion in advertising revenue in Q4, a 22% year-over-year increase.
- Amazon made $68 billion from advertising in 2025.
- Amazon Web Services (AWS) reported $35.5 billion in third-quarter revenue, up 24% year-over-year, and an annual run rate of $142 billion (up from $132 billion).
- Amazon projected $200 billion in capital expenditures for 2026, above analysts' expectations of $146 billion.
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Amazon Q2 Ad Revenue Nears $20B
Amazon reported $19.8 billion in advertising revenue for Q2 2026, a 26% year-over-year increase from $15.7 billion in Q2 2025. The company’s broader earnings showed an outsized jump in net income — from $18.2 billion a year earlier to $62.6 billion — driven largely by $53.4 billion in non-operating pre-tax other income tied to Amazon’s ownership stake in Anthropic. The report emphasizes Amazon’s expanding AI and AWS businesses (with AWS AI product solutions cited as generating $25 billion in Q3) and frames advertising as increasingly integrated with Amazon’s AI-driven commerce offerings, including agentic shopping products and the Ads Agent tool mentioned by CEO Andy Jassy.
Amazon Ads, AWS Drive Blockbuster Q3 Results
Amazon exceeded Wall Street expectations in Q3 2025, reporting revenue above $180 billion and net income over $21 billion. Growth was led by a 20% rebound at Amazon Web Services (AWS), with $33 billion in sales driven by core infrastructure and new AI workloads; the company is expanding capacity (nearly 4 gigawatts added) and launching 'Project Rainier,' a supercomputer cluster for AI. Amazon’s advertising business surged 24% to nearly $18 billion, aided by new partnerships with Netflix, Spotify and SiriusXM and stronger monetization of Prime Video and other properties. Quarterly operating income remained flat at $17.4 billion after a $2.5 billion FTC settlement and $1.8 billion in severance; free cash flow fell by about 70% amid heavy AI and infrastructure spending. CEO Andy Jassy framed AI-driven 'agentic commerce' as a future growth vector for e-commerce and advertising.
Amazon Reports $200.6B Revenue in Q2 2026
Amazon reported Q2 2026 results on July 30, 2026: $200.6 billion in revenue (up 20% year-over-year) and $62.6 billion in profit. AWS grew 36.7% year-over-year — its fastest growth in 18 quarters — and Amazon said its AI and chips businesses each surpassed run rates above $25 billion. Amazon cited investments in AI company Anthropic and added 10+ fully managed foundation models to Amazon Bedrock, with hundreds of thousands of customers now using Bedrock. Advertising revenue grew 26% year-over-year. The company also highlighted Prime Video viewership milestones and additional satellite launches for Project Leo.
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