Amazon's Profit Plunged 73 Percent Due To Kindle Fire Investment

Online, October 30, 2011 (Newswire.com) - It's the too eager to develop a tablet computer Kindle, Amazon's corporate performance is threatened muddy. profit of world's king online retail in the Seattle-based United States is reportedly plummeted by 73 percent.

Bloomberg reported that Amazon's profits in the third quarter of this year fell from U.S. $ 231 million to U.S. $ 63 million. Recently the company suffered losses in the third quarter of 2001, where the profit was only U.S. $ 68.9 million, much of the predictions of U.S. $ 150 million.

Analysts said the losses caused Amazon too eager entered the computer business tablet. For the sake of pursuing the sale of Apple iPad, they sell Kindle too cheap: U.S. $ 199. Even far below the iPad the cheapest price. HIS research firmcalculates Inc., Amazon suffered a loss of U.S. $ 10 from each Kindle unit they sell.

Throughout the first three quarters of this year, Amazon is pretty eager to invest indeveloping the Kindle. They launched the Kindle Fire variant that can run video streaming applications and non-text content other. But ironically, they actually reap bad results: its shares down 12 percent at that time.

But the company argues, the Kindle sales grew 44 percent. Furthermore they claim dated September 28 as a day of ordering Kindle ever, even when compared to the peak moment of the holidays. Currently available in the market 4 Kindle variants, including the 3G model.

It also encourages them eager to invest. Jeff Bezos, Amazon founder and CEO said in three weeks after launch, orders for Kindles directly skyrocketed doubling of available stock. "Looking at the market excitement, we dared to raise investment and add millions of dollars more to build more than we planned," he said.

Colin Sebastian, an analyst firm Robert W. Baird & Co. said, Amazon's attempt to catch up from Apple will cost high. Why, they must start transition from a company's media business to gadget provider. "It is not easy to compete with Apple," he said.

AMAZONS PROFIT PLUNGED 73 PERCENT