Amazon presented its latest financial results for the last quarter of 2021 on Thursday night. Beyond exhibiting muscle in the form of good sales in its e-commerce business and inexhaustible growth in its corporate cloud division (AWS), it was also news that for the first time it detailed the revenue of its advertising business, that of sponsored results in its product listings or those displayed on Fire tablets, until now always masked in a generic “other”.

The detail frightened by the high of its figures: $31.2 billion is what it achieved with its advertising business during the year 2021, with an upward trend still, since according to the company this division increased turnover by 32% in the last quarter of the year, although it is true that for several reasons, starting by concentrating the Christmas campaign and that of Black Friday, it is traditionally the strong quarter for many companies.

This business, until now of an unknown magnitude from the outside, is more than significant. Although for Amazon it does not represent something excessively relevant (7% of its turnover, its profitability is unknown), it is already around double what it is achieving with the physical stores it has opened to date and a figure higher than that achieved with its services, where Amazon Prime subscriptions come in.

Figures in millions of dollars

  1. Google: 121,000
  2. Facebook: 118,000
  3. Amazon: 31,200
  4. Netflix: 28,800
  5. Youtube: 29,700
  6. Microsoft: 10,000
  7. Snap: 4,000
  8. Pinterest: 2500

There are not many companies similar to Amazon, and even fewer that share its magnitude, but Microsoft, for example, shares with it being one of the technological giants that, without advertising being its main business, does represent a part of its income.

In the case of the Redmond company, which monetizes the ads displayed on its search engine Bing and LinkedIn among other spaces, 10 billion dollars is what it achieved through advertising in 2021, three times less than Amazon, as reported a few days ago.

Another technological giant such as Google does have advertising revenue as its main (and practically exclusive) business, but there is a parallel with Amazon: if we only look at the revenue it achieves with YouTube ads, we have only a part of that business. YouTube billed $28.8 billion for its ads in all of 2021, $2.4 billion less than Amazon. Yes, Amazon makes more from ad revenue than YouTube.

If we make the comparison with Facebook, which also has almost all its revenue with advertising as a source, we see that although Amazon is still far from their figures, they “only” triple their turnover. In all of 2021, Facebook closed with about $118 billion in revenue.

Other smaller technologies that also live off advertising have regular revenues much lower than those exhibited by Amazon. This is the case of Snap, which achieved just over $4 billion in the whole of last year, or Pinterest, a little over $2.5 billion.

Netflix, which does not live on advertising but on direct subscription, is also below. They do not compete or play in the same league, but the comparison is curious nonetheless. Compared to Amazon’s $31.2 billion from ads, Netflix made $29.7 billion in 2021 from all concepts, including subscriptions.

A new ad giant has come to town. It arrived a long time ago, but until now we could not size it up.

LEAVE A REPLY

Please enter your comment!
Please enter your name here