The FTC unsealed new details in its Amazon Ads lawsuit, alleging hidden surcharges raised CPCs by up to 250% on Prime Day. Here is what advertisers should know.

The Federal Trade Commission (FTC) and 22 state attorneys general filed an updated complaint against Amazon with newly unredacted details about how the company allegedly inflated prices in its online search advertising auction.

The FTC and its state partners originally sued Amazon in August in the Western District of Washington, alleging the retailer covertly raised the prices advertisers paid on its platforms.

The newly unsealed material alleges that Amazon secretly increased advertising prices by up to 50% above auction results on ordinary days. During major shopping events like Prime Day and Black Friday, the alleged increases reached 250%.

Read on to learn what the unredacted complaint alleges, how Amazon responded to advertiser questions at the time, and what this means for how you evaluate historical campaign performance.

According to the FTC’s November 5 announcement, the unsealed sections of the complaint outline specific cost-per-click (CPC) increases and revenue targets tied to the alleged surcharges between 2021 and 2023.

The complaint alleges that Amazon’s hidden surcharges affected both small businesses and large advertisers across multiple peak shopping periods:

These examples add detail to the original lawsuit, which challenged how Amazon calculated auction prices and explained those calculations to advertisers.

The unsealed material also links Amazon’s alleged surcharges to internal revenue goals.

According to the complaint, Amazon executives discussed needing an additional $40 million in revenue in 2023 to hit corporate financial targets.

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