Amazon Ad Auctions Hit with $20 Billion FTC Lawsuit

Amazon's advertising business has been hit with a major legal challenge from the Federal Trade Commission and 22 US states. The complaint alleges that Amazon secretly inflated minimum prices in its ad auctions, resulting in at least $20 billion in costs for advertisers.

The FTC claims it may seek billions of dollars in damages. According to the complaint, Amazon participated in up to 80% of sponsored-product auctions, often placing its own bids and concealing them from sponsors.

Amazon has denied any wrongdoing, stating that average advertising cost per click remained unchanged between 2019 and 2024. The company also claims it saved advertisers around $8 billion between 2021 and 2025.

The significance of this case lies in its potential impact on Amazon's advertising revenue, which reached $68.6 billion in 2025 - a 22% increase from the previous year. Ad revenue in the second quarter climbed 26% to $19.8 billion.