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United States securities and exchange commission logo
April 26, 2024
Junkoo Kim
Chief Executive Officer
WEBTOON Entertainment Inc.
5700 Wilshire Blvd., Suite 220
Los Angeles, CA 90036
Re: WEBTOON
Entertainment Inc.
Amendment No. 2 to
Draft Registration Statement on Form S-1
Submitted April 15,
2024
CIK No. 0001997859
Dear Junkoo Kim:
We have reviewed your amended draft registration statement and have
the following
comments.
Please respond to this letter by providing the requested
information and either submitting
an amended draft registration statement or publicly filing your
registration statement on
EDGAR. If you do not believe a comment applies to your facts and
circumstances or do not
believe an amendment is appropriate, please tell us why in your
response.
After reviewing the information you provide in response to this
letter and your amended
draft registration statement or filed registration statement, we may
have additional
comments. Unless we note otherwise, any references to prior comments are
to comments in our
February 23, 2024 letter.
Amendment No. 2 to Draft Registration Statement on Form S-1
Management's Discussion and Analysis of Financial Condition and Results
of Operations
Key Factors Affecting Our Performance
Annual Cohort of Paid Content GMV per Paying User of WEBTOON Korea, page
88
1. We note your response
to comment 1 and your revised disclosures on page 88. Please
revise your filing to
more fully explain what the numbers in the y-axis in the graph
represent (e.g.,
approximately $190 million in 2023) in relation to Paid Content GMV. In
this regard it is not
clear to us if or how the amounts represent paid content per paying
user.
Junkoo Kim
FirstName LastNameJunkoo Kim
WEBTOON Entertainment Inc.
Comapany
April NameWEBTOON Entertainment Inc.
26, 2024
April 226, 2024 Page 2
Page
FirstName LastName
Non-GAAP Financial Measures, page 91
2. We note you present and discuss non-GAAP financial measure before you
present and
discuss the most directly comparable GAAP measures. Please revise the
order of your
disclosures to present GAAP measures with equal or greater prominence
as required by
Item 10(e)(1)(i)(A) of Regulation S-K and Question 102.10 of the
Division of Corporation
Finance s Compliance & Disclosure Interpretations on Non-GAAP
Financial Measures.
Critical Accounting Policies and Estimates
Goodwill and Intangible Assets, page 101
3. Please revise your disclosures to more fully address and disclose the
following:
The number of reporting units you have with goodwill;
The numbers of reporting units for which you performed
quantitative or qualitative
impairment tests as of the most recent impairment test;
The remaining amounts of goodwill allocated to each reporting unit
in which you
recoded a goodwill impairment;
The percentages by which estimated fair values exceeded carrying
values as of the
most recent impairment test for any additional at risk reporting
units or disclosure
that the estimated fair values of the remaining reporting units
substantially exceeded
their carrying values;
The methods and key assumptions used to estimate fair values,
including how they
are determined;
The degree of uncertainty associated with key assumptions,
including material
changes during the periods presented and the reasons for changes
as well as
sensitivity analyses regarding the potential impact of changes in
assumptions; and
Potential events and/or changes in circumstances that could
reasonably be expected to
negatively affect key assumptions.
Consolidated Financial Statements
Note 7. Goodwill, net and Intangible Assets, net, page F-27
4. We note your revised disclosures, including the goodwill impairments
you recorded
during the year ended December 31, 2023. Please correct and ensure all
amounts
presented in the goodwill activity roll-forward for FY 2022 and FY
2023 are accurate. In
addition, given the goodwill impairments you recorded, please provide
any additional
disclosures required by ASC 820-10-50 in note 15 and any disclosures
required by ASC
275-10-50 or explain why you believe no additional disclosures are
required.
Junkoo Kim
FirstName LastNameJunkoo Kim
WEBTOON Entertainment Inc.
Comapany
April NameWEBTOON Entertainment Inc.
26, 2024
April 326, 2024 Page 3
Page
FirstName LastName
Note 17. Business Combinations and Disposition, page F-51
5. We note your response to comment 3; however, it is not clear to us how
significant these
fair value differences are. Please tell us the difference between the
fair value of the shares
of Munpia you acquired in February 2022 relative to the implied fair
value of the Munpia
shares you issued to acquire Studio JHS Inc. in August 2022 based on
your fair value
estimate of Studio JHS Inc. and, if applicable, explain the reasons
for any material
difference.
Please contact Stephany Yang at 202-551-3167 or Anne McConnell at
202-551-3709 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Erin Donahue at 202-551-6063 or Evan Ewing at 202-551-5920 with any
other
questions.
Sincerely,
Division of
Corporation Finance
Office of
Manufacturing