Kindle Reader Instrumental In Amazon’s Good Q3 Numbers

Last week Amazon reported excellent third quarter figures. Net income was $ 199 million – a 70% improvement on Q3 2008. Revenues and profits were both better than many analyst’s predictions and a strong fourth quarter is now anticipated. Share price increased by 27% amid strong expectation that Amazon would achieve online retail business dominance in the post-downturn economy.

One of the key factors in Amazon’s success has undoubtedly been the success of the Amazon Kindle e-book reader. The Kindle, first launched in 2007 and now in its second generation, makes up 60% of the US e-book reader market. After what will have seemd like a long wait to many, Amazon has commenced shipping the Kindle 2 reader to over 100 different countries globally. International shipping was accompanied by the second price drop in the eight months since the release of the Kindle 2 in February this year.

This was followed, a mere two weeks later, by a further price drop and a consolidation of a single Kindle 2 reader – the Kindle international version, which now retails for $ 260. This was seen by many as a response to the announcement by Barnes and Noble of their own new “Nook” e-book reader (which also retails for 0). Nevertheless, the focus and consolidation on the huge global market makes perfect sense for a variety of business reasons.

Sony, Microsoft and Apple are all in various stages of development with their new readers. Although the e-book market is relatively new it is changing and growing at incredible speed. Given Amazon’s dominance to date, and the fact that the Kindle is their number one selling product, it seems highly unlikely that Amazon will sit back and watch the other manufacturers overtake them (as they did to Sony a couple of years ago).

Amazon is, of course, far from being a one trick pony. Strong growth in Amazon prime memberships was seen – which offers enhanced delivery options for a one off yearly payment. International markets saw especially strong growth.

A company spokesman predicted that business analysts could expect Amazon to expand both the categories of goods on offer along with geographical expansion over time.

Fourth quarter sales for Amazon.com are predicted to be between $ 8.13 billion and $ 9.13 billion.

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