U.S. authorities have filed a lawsuit against Amazon over the manipulation of advertising prices

The U.S. Federal Trade Commission (FTC) and 22 states have filed a lawsuit against the Amazon marketplace, accusing it of manipulating advertising rates, according to a statement on the FTC's website.

The plaintiffs alleged that Amazon engaged in “deceptive and unfair practices” that “secretly inflated prices in online search ad auctions,” the FTC said. Over more than seven years, Amazon covertly and significantly increased the prices that more than 1 million brands and sellers were forced to pay for advertising on the company’s platform, the Commission alleges.

"As a result, the lawsuit alleges that Amazon's scheme likely cost its unsuspecting advertising clients tens of millions of dollars," the FTC states.

Amazon rejected the allegations in a blog post. According to the company's statement, its advertising policy is designed to show shoppers the most relevant ads. The average cost per click for advertisers remained unchanged from 2019 to 2024 (adjusted for inflation), while conversion (sales generated from those clicks) increased by a quarter from 2021 to 2025, the marketplace claims. Amazon believes the FTC fundamentally misunderstands how advertisers operate.

In 2025, Amazon's digital advertising revenue totaled $68.6 billion, making the company the third-largest player in the market, behind Google and Meta, according to the Financial Times. Amazon’s stock accelerated its decline following the FTC’s announcement: it was down 3.5% at its intraday low but slowed its decline to 2.5% by the end of the trading day.

This lawsuit marks the third major complaint filed by the federal regulator against Amazon: it is in line with the federal government's policy of tightening oversight of the largest technology companies, according to the Financial Times.

In September 2025, the e-commerce giant agreed to pay $2.5 billion in fines and compensation to settle FTC allegations that the company had misled its customers in order to sign them up for Prime. Furthermore, back in 2023, Amazon agreed to pay $25 million to settle claims related to privacy violations involving users of its Alexa voice assistant, the FT notes.

A trial is scheduled for next year on charges that Amazon is illegally using its monopoly position to inflate prices and hinder competitors, according to Bloomberg.

This article was AI-translated and verified by a human editor