Amazon continued to grow out its digital advertising platform during the fourth quarter (Q4) of 2024, with its ad sales reaching nearly $17.3 billion during the period, the company said on Thursday.
The figure was slightly under Wall Street estimates of $17.4 billion in ad sales, with analysts hoping the lucrative holiday season and the company’s broadcasts of football games — including one on Black Friday — would juice interest from brands and marketers.
Still, it represented an 18 percent increase in ad sales growth for the company, whose inventory includes spots against its e-commerce store and Prime Video. Last year, Prime Video stopped offering its content commercial-free to Prime members, choosing instead to switch them to an ad-supported plan by default and charge $3 per month for the privilege of streaming most shows and movies available through the Prime app without ads.
To further bolster its ad business, Amazon has aggressively pursued live sports rights, to include the distribution of some third party networks like FanDuel Sports and a package of National Basketball Association (NBA) games that will debut on Prime Video and Twitch later this year.
The company also continues to rally around its ongoing relationship with the National Football League (NFL), saying its viewership of “Thursday Night Football” games on Prime Video and Twitch increased 11 percent last year compared to the 2023 season. NFL games on Prime Video and Twitch still tend to attract lower viewership compared to games broadcast by ABC/ESPN, CBS, Fox and NBC, though the audience for Amazon-distributed NFL games has increased since it clinched the exclusive distribution rights to the Thursday football package a few years ago.
Amazon is also investing in original television and film content, excluding sports, albeit at a lesser rate. The company said its holiday debut of the Christmas comedy “Red One” starring Dwayne “The Rock” Johnson attracted 50 million viewers to Prime Video worldwide within the first four days of its release, marking the biggest debut audience for a film produced by Amazon MGM Studios ever.
While Amazon’s ad business is growing in part due to increased efforts by Prime Video and Twitch, the company’s cloud computing business continues to be its biggest earner, accounting for $28.7 billion during Q4. The figure was below Wall Street estimates of $28.8 billion, but higher than what Google earned from its cloud computing services business ($11.9 billion). Microsoft won the cloud business wars in Q4, posting $40 billion in income from that part of its operation.
Overall, Amazon’s revenue was $187.7 billion, besting Wall Street estimates by around $400 million. The company is projecting lower revenue during Q1, somewhere between $151 billion and $155 billion, below Wall Street estimates of $158 billion.
