Amazon CEO Andy Jassy highlighted the opportunity to deliver advertisements during user interactions with the company’s AI-powered digital assistant, Alexa+, during the second-quarter earnings call on Thursday.
“People are excited about devices with Alexa+ enabled. Shopping with Alexa+ is a delightful experience that will keep improving,” Jassy said. “Over time, as conversations become more complex, advertising could help users discover new products while driving revenue.”
Alexa+ Expansion and Subscription Tiers
Amazon has rolled out Alexa+ to millions of customers, aiming to enhance the digital assistant with more natural, agentic behavior that competes with generative AI assistants from OpenAI, Google, and others. Alexa+ is free for Amazon Prime members, who pay $14.99 monthly, and Amazon offers a $20 monthly standalone Alexa+ subscription.
Jassy hinted that future subscription tiers might include options like an ad-free experience, signaling an evolving business model.
Until now, Alexa’s advertising has been limited mostly to visual ads on Echo Show devices or audio ads between songs. Jassy’s description of AI-generated ads integrated into multi-turn conversations represents uncharted territory for Amazon and the wider tech ecosystem.
Marketers have shown interest in advertising within AI chatbots, but practical implementation details remain unclear.
Amazon’s competitors are also exploring advertising in AI products. Google is testing ads in its AI-powered search experience, while OpenAI’s CEO Sam Altman has expressed openness to tasteful advertising in ChatGPT.
Amazon’s Growing AI Investments
Amazon’s capital expenditures soared to $31.4 billion in Q2 2025, a 90% increase year-over-year, largely fueled by investments in AI chips and data centers. While AWS revenue grew 18%, Amazon needs new revenue streams to support this expansion.
Jassy is betting that more frequent Alexa+ usage will drive increased advertising and shopping activity on Amazon’s platform. However, early reviews of Alexa+ features have been mixed, with some rollout delays on advanced capabilities.
Amazon faces hurdles before embedding ads in Alexa+ conversations. Like most AI models, Alexa+ can generate hallucinations, raising concerns about false advertising. The company will need safeguards to ensure AI accuracy before advertisers fully commit.
Privacy concerns may also arise. Users tend to share more information with AI chatbots than traditional assistants, raising questions about data use and comfort with ads integrated into natural conversations.
What The Author Thinks
Integrating ads into AI-driven conversations is a promising revenue source, but Amazon must tread carefully. Users expect seamless, helpful interactions—not intrusive marketing. Maintaining trust will require transparent, accurate advertising without compromising privacy. If Amazon can strike that balance, Alexa+ could redefine digital shopping. However, mishandling ads or user data risks alienating consumers and undermining AI’s potential.
Featured image credit: Heute
For more stories like it, click the +Follow button at the top of this page to follow us.