SEC Comment Letter for AMAZON COM (AMZN) — Aug 14, 2018
AMAZON COM INC
Date: Aug. 14, 2018 · CIK: 0001018724 · Accession: 0000000000-18-025080
AI Filing Summary & Sentiment
Letter
Mail Stop 3561 August 13, 2018 Brian T. Olsavsky Chief Financial Officer Amazon.com Inc. 410 Terry Avenue North Seattle, Washington 98109
Re: Amazon.com Inc. Form 10-K for the Fiscal Year Ended December 31, 2017 Form 10-Q for the Quarterly Period Ended June 30, 2018 Filed February 2, 2018 and July 27, 2018 File No. 0 -22513
Dear Mr. Olsavsky :
We have reviewed your filing an d have the following comment s. In some of our comment s, we may ask you to provide us with information so we may better understand your disclosure.
Please respond to these comment s within ten busine ss days by providing the requested information or advis e us as soon as possible when you will respond. If you do not be lieve our comment s apply to your facts and circumstances, please tell us why in your response.
After reviewing your response to these comment s, we may have additional comments.
Form 10 -K for the Fiscal Year Ended December 31, 2017
Item 7: Management’s Discussion and Analysis of Financial Condition and Results of Operations
Net Sales, page 25
1. We note from statements in your Current Report on Form 8 -K filed on April 18, 2018 that you have exceeded 100 million paid Prime members globally a nd that you shipped more than five billion items in 2017 with Prime worldwide. In future periodic reports, please disclose the percentage of net sales attributable to sales to Prime members versus sales to non -Prime members.
Brian T. Olsavsky Amazon.com Inc. August 13, 2018 Page 2
2. We note that AWS Sales increa sed 43% in 2017 as a result of increased customer usage, partially offset by pricing changes. We further note statements from your Current Report on Form 8 -K filed on April 18, 2018 that active users increased by more than 250% “spurred by the broad adopt ion of Amazon SageMaker.” To the extent increases in net sales are attributable to the adoption of new services, such as Amazon SageMaker, please disclose as much in future periodic reports. Please refer to Item 303 of Regulation S -K.
Form 10 -Q for the Quarterly Period Ended June 30, 2018
Revenue, page 8
3. We note your disclosure on page 9 that sales from certain digital media content is presented on a net basis. We also note your disclosure on page 19 that digital media content is presented on a gross basis. Please provide us with your analysis of how you determined whether you are acting as a principal or as an agent in these arrangements. Please also revise your disclosures as appropriate. Reference ASC 606 - 10-55-36 through 39 and ASC 606 -10-50-12 (c).
4. We note your disclosure that revenue related to your third -party seller services, AWS arrangements and advertising services is recognized as the services are rendered. Please tell us and revise to clarify if revenue from these services is recognized over time or at a point in time. Please also clarify your methods used to measure progress, if applicable, and why the methods reflect a faithful depiction of the transfer of the services. Reference ASC 606 -10-50-18 and 19.
We remind you that the company and its management are responsible for the accuracy and adequacy of their disclosures, notwithstanding any review, comments, action or absence of action by the staff.
You may contact Tony Watson, Accountant, at (202) 551 -3318 if you have questions regarding comments on the financial statements and related matters. Please contact Danilo Castelli (Staff Attorney) at (202) 551 -6521 or Mara Ransom (Assistant Director ) at (202) 551 - 3264 or me at (202) 551 -3344 with any other questi ons.
Sincerely,
/s/ William H. Thompson
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Mail Stop 3561 August 13, 2018 Brian T. Olsavsky Chief Financial Officer Amazon.com Inc. 410 Terry Avenue North Seattle, Washington 98109 Re: Amazon.com Inc. Form 10-K for the Fiscal Year Ended December 31, 2017 Form 10-Q for the Quarterly Period Ended June 30, 2018 Filed February 2, 2018 and July 27, 2018 File No. 0 -22513 Dear Mr. Olsavsky : We have reviewed your filing an d have the following comment s. In some of our comment s, we may ask you to provide us with information so we may better understand your disclosure. Please respond to these comment s within ten busine ss days by providing the requested information or advis e us as soon as possible when you will respond. If you do not be lieve our comment s apply to your facts and circumstances, please tell us why in your response. After reviewing your response to these comment s, we may have additional comments. Form 10 -K for the Fiscal Year Ended December 31, 2017 Item 7: Management’s Discussion and Analysis of Financial Condition and Results of Operations Net Sales, page 25 1. We note from statements in your Current Report on Form 8 -K filed on April 18, 2018 that you have exceeded 100 million paid Prime members globally a nd that you shipped more than five billion items in 2017 with Prime worldwide. In future periodic reports, please disclose the percentage of net sales attributable to sales to Prime members versus sales to non -Prime members. Brian T. Olsavsky Amazon.com Inc. August 13, 2018 Page 2 2. We note that AWS Sales increa sed 43% in 2017 as a result of increased customer usage, partially offset by pricing changes. We further note statements from your Current Report on Form 8 -K filed on April 18, 2018 that active users increased by more than 250% “spurred by the broad adopt ion of Amazon SageMaker.” To the extent increases in net sales are attributable to the adoption of new services, such as Amazon SageMaker, please disclose as much in future periodic reports. Please refer to Item 303 of Regulation S -K. Form 10 -Q for the Quarterly Period Ended June 30, 2018 Revenue, page 8 3. We note your disclosure on page 9 that sales from certain digital media content is presented on a net basis. We also note your disclosure on page 19 that digital media content is presented on a gross basis. Please provide us with your analysis of how you determined whether you are acting as a principal or as an agent in these arrangements. Please also revise your disclosures as appropriate. Reference ASC 606 - 10-55-36 through 39 and ASC 606 -10-50-12 (c). 4. We note your disclosure that revenue related to your third -party seller services, AWS arrangements and advertising services is recognized as the services are rendered. Please tell us and revise to clarify if revenue from these services is recognized over time or at a point in time. Please also clarify your methods used to measure progress, if applicable, and why the methods reflect a faithful depiction of the transfer of the services. Reference ASC 606 -10-50-18 and 19. We remind you that the company and its management are responsible for the accuracy and adequacy of their disclosures, notwithstanding any review, comments, action or absence of action by the staff. You may contact Tony Watson, Accountant, at (202) 551 -3318 if you have questions regarding comments on the financial statements and related matters. Please contact Danilo Castelli (Staff Attorney) at (202) 551 -6521 or Mara Ransom (Assistant Director ) at (202) 551 - 3264 or me at (202) 551 -3344 with any other questi ons. Sincerely, /s/ William H. Thompson William H. Thompson Accounting Branch Chief Office of Consumer Products