In this article, let’s discuss one reason why investors believe Amazon should cross the trillion-dollar market cap: advertising sales.
Amazon continues to see strong adoption from sellers and third-party advertisers wishing to leverage Amazon’s platform to reach prospective customers. Essentially, Amazon hopes to offer consumers smarter recommendations. Additionally, vendors wish to increase brand awareness of their products. Sounds promising, right?
The investment community is quick to sight Amazon’s outstanding growth capabilities from advertising witnessed in Q2 2018. More specifically, when we look under Amazon’s hood for its revenue drivers in its 10-Q for Q2 2018, we read a line saying ‘other’. Amazon states that this line primarily includes sales of advertising services. Amazon’s other line saw a jump of more than 129% YoY to $2.2 billion (const. curr.) which has the illusion of being astounding.