July 31, 2025
July 31, 2025

Amazon’s Q2 Results Show Why Retail Media Is a Must for Shopify Powered Retailers

Amazon's Q2 2025 results underscore retail media's profitability, with ad revenue up 23%. Independent shopify powered retailers must embrace retail media to remain competitive

Amazon’s Q2 Results Show Why Retail Media Is a Must for Independent Retailers

Amazon’s fiscal Q2 2025 earnings reveal more than just solid top‑line growth. They highlight how retail media — advertising sold through Amazon’s own marketplace and streaming platforms — is becoming a core profit engine. Understanding this shift is vital for independent and mid‑tier retailers looking to compete in a landscape dominated by giants.

Q2 2025 Highlights

In the quarter ending June 30, 2025, Amazon’s net sales rose 13 % year‑over‑year to 167.7 billion dollars. Operating income jumped to 19.2 billion dollars, up from 14.7 billion dollars a year ago, and net income reached 18.2 billion dollars. One of the biggest bright spots was advertising services revenue, which grew 23 % to 15.7 billion dollars. This line item now accounts for roughly nine percent of total net sales and contributed most of the increase in operating income.

Visual suggestion: insert your earnings‑results graphic showing advertising’s contribution to revenue and net profit.

Why Advertising Matters So Much

Advertising is Amazon’s fastest‑growing revenue line. In Q2 2025, advertising services revenue increased 23 % year‑over‑year, or 22 % excluding currency effects. Because the advertising business has minimal cost of sales, nearly all of this revenue drops directly to the bottom line. Gross margin improved from about 50 % to 51.8 %, and net margin increased to 10.8 %, with incremental advertising revenue accounting for roughly two‑thirds of the increase in operating income.

Visual suggestion: add a bar chart comparing Amazon advertising revenue in Q2 2024 (12.8 billion dollars) versus Q2 2025 (15.7 billion dollars).

Why This Matters for SMBs

Independent and mid‑tier retailers can’t ignore Amazon’s success with retail media. As Amazon and other big retailers use ad revenue to subsidize lower prices and fund customer‑experience improvements, smaller retailers risk falling behind. High‑margin advertising income enables giants to invest in faster shipping, AI‑powered product recommendations and premium content — initiatives that raise customer expectations and widen competitive moats.

Conversely, independent retailers often sit on valuable first‑party data and loyal audiences. By launching their own retail‑media programs — for example through sponsored product placements or display ads on their websites — they can create new revenue streams and strengthen supplier relationships. Platforms like Zenbundle make this achievable without heavy technical investment by offering no‑code ad serving, targeting and analytics tools.

Call to Action: Getting Started with Retail Media

To remain competitive, independent and mid‑tier retailers should:

  • Audit their data: understand what customer data is available and how to use it (with appropriate privacy controls) for targeted advertising.
  • Launch small advertising pilots: start with sponsored listings or banner ads to capture incremental revenue.
  • Leverage turnkey platforms: use solutions that handle ad serving, billing and measurement to avoid large development costs.
  • Partner with suppliers: invite top brands to participate in retail‑media pilots and share performance insights.
  • Reinvest profits: use advertising revenue to improve fulfillment, personalization and loyalty programs, mirroring what Amazon does.

Amazon’s latest earnings show that retail media is not just a trend — it’s a strategic imperative. By embracing this model, independent retailers can unlock high‑margin revenue, create better shopping experiences and compete more effectively against industry giants.

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