Amazon profit drops 35 percent on currency, Fire woes

11608updated 05:20 pm EDT, Thu April 26, 2012 Net income down, but net sales up

Amazon on Thursday recorded a significant hit to its profit for the first quarter of 2012. Its net income dropped 35 percent from year-to-year, to $130 million. Net sales were still up 34 percent to almost $13.2 billion, setting a new high.The company blamed a small amount of the profit drop on high foreign exchange rates that hurt both its net sales and operating income, which combined cost Amazon about $60 million.

How much the Kindle Fire impacted the company's performance wasn't apparent. Last fall, it saw profit cut in half in what's believed to have been a voluntary profit hit to build share for the Android tablet. The Kindle Fire may be sold at a loss and would have to make up for the deficit based on content sales.

As in the past, Amazon has declined to say how many Kindle devices it has sold. The firm would only say that the Kindle Fire was still the bestselling product on Amazon. Previously, Amazon had argued that it was a competitive secret, although it's often speculated that the company wants to avoid any disappointment if it ever sees poor sales.

The company did make the further claim that its Kindle app, not iBooks, was the top free book app on the iPad.

By Electronista Staff

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Amazon, Investor, industry, gadgets, Kindle, Kindle Fire

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