The Australian internet advertising market recorded double-digit growth in 2025, with total expenditure rising 11.5 per cent year-on-year to $18.4 billion, according to the latest Internet Advertising Revenue Report (IARR) released by IAB Australia.

The report, prepared by PwC Australia, found that video advertising remained the strongest performing segment, increasing 19.8 per cent over the year to reach $5.4 billion. Video now represents 29 per cent of total online advertising expenditure.

Search advertising reached a new annual high of $8.0 billion, up 11.5 per cent year-on-year. Classifieds rose 5 per cent to $2.9 billion, while display advertising excluding video increased 1.9 per cent to $2.1 billion. 

Audio advertising grew 8.2 per cent to $339 million, with podcasting growth outpacing streaming audio.

According to the report, video contributed the largest share of growth within display advertising in 2025. Social video increased its share of total video investment, accounting for 40 per cent of total video expenditure for the calendar year and growing 35.1 per cent year-on-year. 

The report also noted continued investment across broadcaster video on demand (BVOD) and other video environments.

Across buying methods for content publishers’ display inventory, agency buying via insertion order increased its share during 2025. 

Programmatic buying, by contrast, lost share during the peak Australian sporting season period, the report found.

Connected TV inventory continued to gain share within content publishers’ video offerings, reaching a new peak in 2025. 

The report attributed this to high-demand viewing environments associated with major sporting events.

Retail remained the leading industry category for reported general display advertising among content publishers and media owners for the fifth consecutive year. Automotive and entertainment and media followed. 

Financial products and services, including insurance, recorded the largest increase in share during the year, while home products entered the top five industry categories for the first time.

Gai Le Roy, chief executive of IAB Australia, said the results reflected selective growth across the market.

“The 2025 results show a market that is growing, but selectively,” Le Roy said. “Overall investment increased strongly, driven primarily by video and search, while other display environments saw more modest movement. Social video and podcasting continue to outperform the market.”

Le Roy said that while large media agencies continued to play an important role, other buyers were also contributing to growth.

“While the large media agencies remain important drivers of scale, we’re also seeing strong investment from independent agencies, high-growth brands managing their own media, and SMEs,” she said. 

“Established advertisers continue to expand in-house capability, and we’re seeing increased investment from Chinese and other international brands seeking to connect with Australian audiences.”

The report also detailed results for the December 2025 quarter, when total internet advertising expenditure reached $4.9 billion, up 14.4 per cent compared with the December 2024 quarter.

Video advertising for the quarter increased 15.4 per cent year-on-year, continuing to outperform non-video display formats, according to IAB Australia.