Amazon's marketing strategy rests on making convenience the product: Prime members get fast delivery, and Amazon uses the resulting traffic to build a large advertising business. In the second quarter of 2026, Amazon's net sales rose 20% to $200.6 billion and its advertising services grew 26% to $19.8 billion. Part of that growth reflects Prime Day moving into the quarter, which Amazon said affects year-over-year comparisons.
Amazon changed online shopping habits by turning delivery speed into the main reason to buy from it. In its second-quarter 2026 release, Amazon said it again set record delivery speeds for Prime members in the first half of the year, with over 40% more items delivered same-day or overnight.
The company is also extending that model beyond standard orders. Amazon said Amazon Now, its ultra-fast delivery service, is available in nine countries and more than 250 cities and towns, and that grocery and everyday essentials are growing meaningfully faster than the rest of its stores business.
Why did convenience become Amazon's competitive advantage?
Convenience became Amazon's advantage because shoppers compare every other retailer with its delivery times. Amazon's own reporting shows how much it invests in that expectation: its release highlights delivery speed, same-day and overnight volume, and new fast-delivery services as the main stores-business results.
Andy Jassy, Amazon's president and CEO, pointed to delivery speed and advertising as the standout results in the quarter. The company also launched Amazon Supply Chain Services, which lets outside businesses such as Procter & Gamble, 3M, Lands' End and American Eagle Outfitters use its distribution network, per the release as reported by FashionUnited.
How does Prime encourage customer loyalty?
Prime encourages loyalty by bundling fast delivery and other benefits into one membership, so shoppers have a reason to start their searches at Amazon. Chief Financial Officer Brian Olsavsky said on the July 30, 2026 earnings call that Prime remains a key pillar of the business and that membership growth was double-digit year over year. Amazon does not give a member count in its press release.
Amazon has also built shopping events around Prime. Everything-PR's roundup of big-box retail marketing campaigns notes that Amazon invented Prime Day, and the company's 2026 results show how important the event's timing has become to quarterly comparisons.
Andy Jassy said on the July 30, 2026 call that more of Amazon's shoppers are discovering products through its agentic and conversational tools, including Alexa+ and Alexa for Shopping, according to coverage of the call. For marketers, that matters because discovery inside Amazon's own tools can shift where brands need to appear, but Amazon did not give figures in the coverage reviewed here.
How does advertising support Amazon's retail model?
Advertising supports Amazon's retail model by turning shopper traffic into a second revenue stream from brands that want to be found. Amazon reported advertising services revenue of $19.8 billion in the second quarter of 2026, up 26% from a year earlier.
That growth rate was faster than the 16% growth in Amazon's North America segment. The comparison suggests advertising is growing faster than retail itself, though the release does not break out how much of the advertising comes from sellers using Amazon's stores.
Where can readers compare Amazon's ad business with rivals?
Everything-PR's retail media analysis compares the ad businesses of Amazon, Walmart, Kroger and Uber, and its Walmart article reports Walmart global advertising up 38% in the quarter ended July 31, 2026, against Amazon's 26% for advertising services. The two figures are not like for like, because the companies define and report advertising differently, but both show fast growth. Different quarter-end dates also matter.
What do Amazon's results show about the strategy?
Amazon's results show strong growth across retail, advertising and cloud, with some quarter-specific effects that readers should account for. The table lists the main figures from Amazon's second-quarter 2026 release.
| Measure | Q2 2026 figure | Source |
|---|
| Net sales | $200.6 billion, up 20% | Amazon Q2 2026 release, July 30, 2026 |
| North America segment sales | $116.2 billion, up 16% | Amazon Q2 2026 release |
| North America operating income | $9.1 billion, up from $7.5 billion | Amazon Q2 2026 release |
| Advertising services | $19.8 billion, up 26% | Amazon Q2 2026 release, as reported by Pulse 2.0 |
| Third-quarter 2026 sales outlook | $197.0 billion to $202.0 billion, up 9% to 12% | Amazon Q2 2026 release |
Two caveats apply. Olsavsky said on the call that Prime Day shifted into the second quarter for most of Amazon's large countries, including the United States, after falling entirely in the third quarter in 2025. He said excluding Prime Day in both years would have made third-quarter growth nearly 400 basis points higher. He also said Amazon received about $600 million in tariff-related refunds in the quarter.
Amazon also reported net income of $62.6 billion, which included $53.4 billion in non-operating pre-tax other income, primarily from its investments in Anthropic. Net income is therefore a poor guide to retail performance in this quarter.
How profitable is Amazon's retail business?
Amazon's North America segment earned $9.1 billion in operating income on $116.2 billion in sales in the second quarter of 2026, up from $7.5 billion a year earlier, according to Amazon's release. The International segment earned $1.7 billion on $42.2 billion in sales, up from $1.5 billion. Olsavsky's comments on tariff refunds and Prime Day timing are two items that can distort comparisons between quarters.
What happened with Amazon's tariff refunds?
Olsavsky said Amazon received about $600 million in tariff refunds in the second quarter. He explained that the total was limited because Amazon forward-bought and pre-positioned inventory to avoid tariff costs, and because Amazon is not the importer of record for the large majority of items sold in its store. Amazon said it will automatically refund customers where it can trace specific import charges passed on to them, and will otherwise use refunds to invest in low prices, according to reports of the call.
How does Prime Day timing change the comparisons?
Prime Day moved into the second quarter of 2026 for most of Amazon's large countries, including the United States, after falling entirely in the third quarter of 2025. Olsavsky said that, excluding Prime Day in both years, third-quarter 2026 growth would have been nearly 400 basis points higher than the guided 9% to 12%. Readers comparing Amazon's second-quarter growth with earlier quarters should therefore treat the 20% figure as helped by timing, and the third-quarter outlook as held down by it.
What can traditional retailers learn from Amazon?
Traditional retailers can learn that convenience is a measurable promise, not a slogan, and that each delivery improvement raises what shoppers expect from every competitor. Four lessons follow from Amazon's reporting.
- Pick a convenience promise you can measure, such as same-day or overnight delivery, and report on it.
- Bundle benefits into a membership so shoppers have a reason to return before comparing prices elsewhere.
- Treat shopper traffic as an asset. Amazon's advertising revenue grew faster than its North America sales.
- Watch event timing. Amazon's own guidance shows one shopping event can move growth between quarters.
Amazon's membership model sits alongside Costco's membership strategy, and the full list of retailers is on the How America Shops series page.
Why does Amazon's convenience model work?
Amazon's convenience model works because faster delivery, a membership that rewards repeat orders and a growing ad business all reinforce each other. The strategy depends on keeping delivery ahead of competitors, which is why Amazon keeps reporting delivery speed as its leading retail metric.
Sources
This article draws on Amazon's second-quarter 2026 results and its earnings call.
- Amazon.com, "Amazon.com Announces Second Quarter Results" (July 30, 2026)
- Amazon Q2 2026 earnings call transcript, July 30, 2026
- FashionUnited, "Amazon Q2 net sales jump 20 percent as cloud and retail surge" (July 31, 2026)
- Pulse 2.0, "Amazon Reveals Net Sales Up 20% To $200.6 Billion For Q2 2026"
- Bloomberg Law, "Amazon Got $600 Million Tariff Refund, Some for Shoppers" (July 30, 2026)
- Home Page News, "Amazon Prepares for Some Customer Tariff Refunds After Strong Q2" (July 31, 2026)
