Amazon has agreed to pay $2.5 billion to settle claims that it misled millions of customers into signing up for Prime subscriptions. The settlement, announced by the Federal Trade Commission (FTC), addresses deceptive practices known as “dark patterns,” which nudge users into subscribing or prevent them from easily opting out. The payout includes both fines and refunds for affected customers.
The $2.5 billion settlement is divided into two portions:
$1 billion in penalties for the FTC
$1.5 billion set aside to reimburse Prime subscribers who were misled
According to Reuters, approximately 35 million users could be eligible for compensation. Customers who joined Prime between June 2019 and June 2025 through specific promotions and barely used the benefits will automatically receive $51. Users who struggled to cancel their subscriptions during this period can also file claims for reimbursement.
Amazon emphasized that the settlement allows the company to “move forward and focus on customers.” The e-commerce giant stated:
“We work incredibly hard to make it clear and simple for customers to both sign up or cancel their Prime membership, and to offer substantial value for our many millions of loyal Prime members around the world.”
Despite the hefty figure, analysts noted the fine is relatively small compared to Amazon’s revenue, which totals roughly $2.5 billion every 33 hours. Investors appeared largely unfazed, as shares saw minimal movement after the announcement.
As part of the settlement, Amazon has committed to improving its Prime subscription interface:
Clear, bold option to decline Prime at sign-up
Easier cancellation process
Transparent disclosure of subscription terms
Appointment of an independent supervisor to ensure compliance
However, Amazon clarified that the settlement mostly maintains changes already in place, rather than requiring major new adjustments.
The FTC’s complaint outlined that between 2017 and 2022, Amazon intentionally designed its website to steer users toward Prime, even when they did not intend to subscribe. Executives allegedly delayed fixes that would have made cancellation simpler.
The FTC launched its investigation in 2022 and filed a lawsuit in 2023, leading to court proceedings in Seattle before the settlement was reached. FTC Chair Andrew Ferguson hailed the outcome as a “monumental win” for consumers frustrated with difficult-to-cancel subscriptions.
This settlement represents the second-largest consumer restitution in FTC history and is part of a broader crackdown on major tech companies in Silicon Valley. Internal emails revealed Amazon staff knowingly employed confusing design patterns, with one email calling subscription-driving tactics “a bit of a shady world” and another describing them as “an unspoken cancer.”
Former FTC Chair Lina Khan criticized the settlement on social media, describing the $2.5 billion payout as “a drop in the bucket for Amazon” and a relief for executives who harmed consumers.
Despite the controversy, Amazon Prime remains highly popular. Since its launch in 2005 at $79/year, the service now costs $139/year. In the first half of 2025 alone, Amazon earned nearly $24 billion from subscription services.
Jeff Bezos aimed to make Prime indispensable, and analysts like Zak Stambor from eMarketer note that Prime continues to be deeply entrenched in American households, even with easier cancellation options.
Conclusion
While Amazon has paid a record-setting $2.5 billion settlement over misleading Prime sign-ups, the program remains robust and widely adopted. The FTC settlement improves transparency and customer control, but Prime’s appeal and dominance in the subscription market are largely unaffected.