updated 04:55 pm EST, Tue January 31, 2012
Amazon Q4 defined by Kindle Fire losses
Amazon posted results Tuesday that outlined the costs of pushing the Kindle Fire. The online shop's Kindle device sales almost tripled, at about 177 percent over the past year. Its net profit dropped 58 percent to $177 million, however, underscoring how it had sold the Fire at a loss to get device share.
The profit slash came in spite of a 35 percent sales hike to just over $17.4 billion.
As it has in the past, Amazon has so far refused to report its actual Kindle shipments or to break down the ratio of the Kindle Fire to its e-paper readers. The official statements make it difficult to verify unofficial estimates which have had as many as six million Kindle Fires shipping this fall. Most estimates have it at less, since Amazon was selling a maximum of a million Kindle devices of any kind a week during December, making it doubtful that the Fire could have shifted that many from its mid-November launch onwards.
The Fire has been the bestseller on Amazon since launch, but it's not known what this means without context. Amazon has always argued that it doesn't publish numbers to maintain a competitive secret. Critics have pointed to Apple being very public with its figures and have suggested that Amazon avoids device numbers to mask any disappointments.
Whether or not predictions are accurate, rumors and outlooks have Amazon cutting production by large numbers without the momentum of a holiday to drive units. Apple has often seen only mild slumps or even increases in numbers of its devices in recent years.