Amazon Q1 financial results: Advertising revenue jumps by 24%

The company introduced unskippable ads to its Prime Video streaming service this year.

Amazon has announced financial results for its first quarter ending March 31, 2024. The company's ad revenue climbed to $11.8 billion in the first quarter from $9.5 billion a year earlier.

Amazon's efforts to expand its advertising arm yielded positive outcomes this quarter. The company raked in $11.8 billion in ad revenue, marking a 24% increase from the previous year. Notably, Amazon introduced unskippable ads to its Prime Video streaming service this year, a move that has garnered enthusiasm from marketers, according to Andy Jassy, Amazon president and CEO. Customers have the option to opt out of these ads for a fee of $2.99 per month.

Jassy emphasised, "Our Advertising efforts continue to benefit from the growth of our Stores and Prime Video businesses. It’s very early days in all of our businesses and we remain excited by how much more we can make customers’ lives better and easier moving forward.”

Net sales increased 13% to $143.3 billion in the first quarter, compared with $127.4 billion in first quarter 2023. Net income increased to $10.4 billion in the first quarter, or $0.98 per diluted share, compared with $3.2 billion, or $0.31 per diluted share, in first quarter 2023.

According to LSEF data, the company is expecting revenue of $144.0 billion to $149.0 billion for the current quarter ending June, compared with analyst consensus expectations of $150.07 billion.

"It was a good start to the year across the business, and you can see that in both our customer experience improvements and financial results,” stated Jassy.

He added, “The combination of companies renewing their infrastructure modernisation efforts and the appeal of AWS’s AI capabilities is reaccelerating AWS’s growth rate (now at a $100 billion annual revenue run rate); our Stores business continues to expand selection, provide everyday low prices, and accelerate delivery speed (setting another record on speed for Prime customers in Q1) while lowering our cost to serve."