Walmart Connect, Walmart's U.S. retail media arm, experienced a 43% increase in revenue, signaling a powerful challenge to Amazon's long-held dominance in the sector. Walmart Connect's rapid expansion indicates a significant shift in advertiser priorities, as brands seek more diverse avenues to reach consumers beyond the established leader.

However, Amazon continues to generate tens of billions in ad revenue and holds nearly 80% of the U.S. retail media market. Despite this, a growing number of new players are entering the space, and advertisers are actively diversifying their spending. This tension between Amazon's massive scale and the emergence of agile competitors defines the current retail media environment.

The retail media market is poised for significant fragmentation and increased competition, likely leading to more diverse advertising options and pricing pressures for dominant players, while also increasing complexity for advertisers. This fragmentation suggests a future where specialized data insights and targeted reach will become increasingly valuable, challenging the reliance on transaction-focused models alone.

The Titans and Their Challengers

  • $76 billion — Amazon's ad business generated this amount in the last 12 months, holding nearly 80% of the U.S. retail media market, according to ADWEEK. Amazon's ad business generated $76 billion in the last 12 months, underscoring its immense scale and its entrenched position as the primary destination for retail media spending.
  • $6.4 billion — Walmart's advertising revenue reached this figure in 2025, representing a 46% year-over-year increase, as reported by ADWEEK. Walmart's advertising revenue reached $6.4 billion in 2025, representing a 46% year-over-year increase, highlighting its successful efforts to build a robust alternative to Amazon's digital-first platform, leveraging its extensive physical store footprint.
  • $915 million — Target reported this amount in advertising revenue last year, a rise from $522 million two years prior, according to ADWEEK. Target reported $915 million in advertising revenue last year, a rise from $522 million two years prior, further demonstrating the rapid expansion of challenger retail media networks.

These figures emphasize the immense value and rapid expansion of retail media, driven primarily by Amazon but with other major retailers rapidly closing the gap. The rapid revenue growth of Walmart Connect (43% increase) and Target (from $522M to $915M) indicates that traditional retailers are successfully leveraging their physical footprint and shopper data to build compelling alternatives to Amazon's digital-first model. The rapid revenue growth of Walmart Connect (43% increase) and Target (from $522M to $915M) indicates that traditional retailers are successfully leveraging their physical footprint and shopper data to build compelling alternatives to Amazon's digital-first model, suggesting a strategic shift in advertiser investment, moving beyond simple budget expansion with Amazon to actively diversifying across multiple platforms.