If you thought Amazon's prices seemed too good to be true, well, it turns out they might be — for Amazon, at least. The company managed to turn $US13.8 billion of revenue into a $US274 million loss this past quarter. And while a big chunk of that was due to losses at LivingSocial and foreign-exchange rates, all is clearly not well on Mount Bezos.
Amazon remained silent on just how many Kindle devices it has sold, but reiterated that it doesn't make any money off of the ones that it has. Said Bezos:
"Our approach is to work hard to charge less. Sell devices near breakeven and you can pack a lot of sophisticated hardware into a very low price point... And our approach is working — the $US199 Kindle Fire HD is the #1 bestselling product across Amazon worldwide. Incredibly, this is true even as measured by unit sales."
The approach may be working in terms of moving units, but that clearly has been translating into less and less profit. But hey, that just means you're getting every bit the bargain you thought you were.
Amazon is holding a call today to discuss what happened in more detail; we'll be updating as necessary. For now, though, clearly Amazon looks like a ship that needs righting. [Businesswire]