Amazon CEO Plans AI-Driven Conversational Ads in Alexa+

Amazon CEO Andy Jassy announced plans to integrate AI-driven advertising into Alexa+, the company's advanced conversational AI assistant, during the Q2 2025 earnings call. Alexa+ is currently available free for Prime subscribers or via a $20 monthly standalone subscription, with Jassy hinting at potential new tiers, including an ad-free option. Unlike previous limited ad formats such as pre-recorded spots or banner ads, the new approach envisions dynamic, AI-generated product recommendations seamlessly woven into multi-turn conversations to enhance discovery and drive revenue. This initiative comes amid a 90% year-over-year increase in Amazon's capital expenditures largely tied to AI chip development and data center expansion, with advertising revenue already growing 22% year-over-year. Amazon's move parallels similar efforts by Google and OpenAI to explore advertising within AI interfaces, though challenges remain around accuracy, user trust, and privacy concerns. While some users may welcome personalized ads, others could view them as intrusive, underscoring the delicate balance Amazon must maintain as it commercializes Alexa+ further.