Amazon has been shouting about the success of the Kindle for a while now but the company really stepped things up over the holiday period. 'Top selling item' this and 'most gifted item' that, Amazon said. All well and good you said, but how many have you actually sold? What does "most gifted item" mean in terms of sales?
Well, it seems we're not the only ones wondering where Amazon's sales figures have gone to. Reuters reports that investors are growing impatient with all the fanfare and no evidence to substantiate the online retailer's claims.
Amazon shares hit an all time high in December. However, as more ereaders enter the market and challenge the Kindle, there's a risk that the device will be outdone by a newer model; and investors, who have no clue as to what kind of sales figures the device is seeing, could panic.
"As long as Amazon continues to have the right margins and the right profit numbers at the end of every quarter, they can probably get away with that," James McQuivey, an analyst at Forrester Research told Reuters. But, if the Kindle starts to drop, the knock-on effect could be substantial.
"You may suffer a 10 to 15 to 20 percent correction because the uncertainty factor would be so high," McQuivey said. "It ensures that if there is bad news, people imagine the worst."
Analysts at Bank of America Merrill Lynch are of the same mind. In a note, the analysts said the recent statements about the Kindle were frustrating and more geared toward generating press than providing investors and consumers with the relevant information.
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