The ammount of money Amazon spent investing in their Kindle Fire product has caused their quarterly profits to be massively reduced, even though net sales and income are up on the last one. On a net income of just under £50 million, Amazon has announced a 73% dip in profits. This left stock holders dumping their holdings, lowering the overall value of an amazon share by 12%.
Jeff Bezos, founder and CEO of Amazon.com has tried to counter this worrying slide, stating that, “In the three weeks since launch, orders for electronic ink Kindles are double the previous launch. And based on what we’re seeing with Kindle Fire pre-orders, we’re increasing capacity and building millions more than we’d already planned.”
Net sales were apparently up, with last quarter seeing “just” $7.56 billion, whereas this quarter – taking into consideration Kindle Fire sales – saw them reach $10.88 billion. However, Amazon doesn’t think they’ll be stopping there. They claim in their financial report that they expect Q4 net sales to reach somewhere between $16.45 billion and $18.65 billion.
Amazon were also keen to mention in the report some other milestones for the company this year, including the release of several other models of Kindle ebook readers, the fact that they now have licensing agreements with Twentieth Century Fox and PBS and that they’d expanded their operations internationally to include a French Kindle book store, offering some 35,000 French language books, as well as Amazon.es, a Spanish version of the online store.