Concern raised over whether Amazon will hit profit

CONCERN IS BUILDING over whether bookseller Amazon will hit its fourth quarter profit forecast after aggressive pricing on the Kindle Fire device hit the retailer.

According to Reuters, Amazon shares dropped to levels not seen since March on Wednesday, down 30 cents to close at $180.21, but they had touched $170.25 earlier in the day.

As recently as mid-October, Amazon shares hit a record $246.71, up more than 35 per cent for the year to date.

Since then, Amazon has launched its Kindle Fire tablet at a $199 price point, which IHS Isuppli and other computer industry analysis firms estimate is close to cost.

From the middle of November, when Amazon started shipping the Kindle Fire, shares of the company are down more than 20 per cent.

Earlier this week, we reported that Amazon is rolling out an update for its Kindle Fire tablet in the US after getting many customer complaints about the recently launched device.

Customer complaints on the Amazon web site centre on the tablet's web browsing, touchscreen, lack of privacy and lack of an external volume control on the device.

Apparently, Amazon plans to release an update to its Kindle Fire user interface in the next two weeks to address these problems.

We still don't have the Kindle Fire tablet in the UK, nor do we have the Amazon Appstore. However, latest reports indicate that these will arrive in January, just in time to miss Christmas. µ