April 22nd, 2009
Shock horror! Amazon makes profit on Kindle 2 sales!
An iSuppli teardown estimates that Amazon’s $359 Kindle 2 is actually made up of parts that add up to $185.
The problem with these teardown studies is that they don’t take into account R&D, marketing, distribution, warranty and so on. When you take that into account, that $174 “profit” will be shaved down considerably.
There will be a profit on each Kindle 2 sale that Amazon makes, but it won’t be anywhere near the $174 suggested by the teardown.
Adrian is a technology journalist and author who has devoted over a decade to helping users get the most from technology. He also runs a popular blog called The PC Doctor. See his full profile and disclosure of his industry affiliations
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