Comment on Amazon's Advertising Business Is Killing It

Amazon's Advertising Business Is Killing It

One of the standout segments from Amazon.com's (NASDAQ: AMZN) first-quarter earnings report was its "other revenue" line item that totaled $2.03 billion.Amazon doesn't break down its other revenue category, but says it "primarily includes sales of advertising services, as well as sales related to our other service offerings." That's a slight change from the previous wording -- "certain advertising services and our co-branded credit card agreements" -- indicating that advertising accounts for an even larger percentage of the other revenue category.The distinction also reflects an accounting change that was responsible for a $560 million increase in the first quarter, as some advertising services are now being included in revenue instead of a reduction of costs to sales.Even after adjusting for the accounting change, Amazon's other revenue line item increased 72% year over year.

 

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