Internet advertising spend reaches $4.2 billion in Q1 fuelled by video: IAB

The Australian internet advertising market has reached $4.2 billion for the March 2025 quarter, an increase of 11.6% year on year, according to the IAB Australia Internet Advertising Revenue Report (IARR)

The report also showed that the local market experienced a much softer than usual seasonal decline in spend from the December quarter at -1.8% in 2025 versus -4.2% in 2024.

Growth in advertising spend growth this quarter was fuelled by video advertising which was up 23.3% year on year to reach $1.165 billion and now represents 28% of investment dollars. Search revenue increased 10% year on year to reach $1.896 billion, while Classified listing revenue increased 7.8% to reach $660m driven primarily by the real estate category.

Audio investment also saw an increase in spend of 18% year on year to reach $77.3m in spend, while display advertising (excluding video) softened by 0.9% year on year to reach $461m. Social media, which has revenue allocated within both video and display, had 17% share of the market.

Gai Le Roy, CEO of IAB Australia, said: "The Australian digital advertising market again saw double digit growth year on year in the March quarter, with strong increases in video, search, social and audio.

"While we are seeing solid topline growth there is still some nervousness in the market around long term planning and brand investment which should be tempered by any future interest rate cuts in coming months."

Retail and auto remained the top two display advertiser investment categories at 17.1% and 12.9% respectively, though their share declined marginally year on year. The finance, FMCG and insurance categories all saw significant jumps in share.

Desktop advertising surged in its share of content publishers and local broadcasters’ video inventory expenditure this quarter, increasing from 32% in the December quarter to reach 42% of investment in the March quarter, however CTV investment remains the largest component of this part of the market at 46% share.

Top image: Gai Le Roy

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