Amazon expected to cut Kindle Fire orders in half as new iPad looms

Posted:
in iPad edited January 2014
Orders for Amazon's new Kindle Fire tablet will reportedly be cut in half to 3 million units in the first quarter of 2012, with slower post-holiday sales and the anticipated launch of Apple's third-generation iPad.



Sources from Amazon's supply chain in the Far East DigiTimes that Kindle Fire orders with original device manufacturers are expected to be just 3 million units this quarter. That's half the 6 million units Amazon reportedly shipped during the holiday quarter of 2011.



Orders for the start of 2012 will top off at a million per month as sales are expected to significantly drop following the holiday shopping season. Suppliers reportedly indicated that the reduction is in line with expectations for companies like TPK Holdings and Wintek.



The Kindle Fire made a splash on the touchscreen tablet market last quarter, when Amazon began selling the device for just $199, or less than half Apple's entry-level $499 price for the iPad 2. One analysis from earlier this month suggested the Kindle Fire took away no more than 2 million iPad sales from Apple over the holiday season.



Amazon announced in late December that it was selling more than a million devices per week from its Kindle family, including the Fire and its traditional e-ink readers. While the online retailer said the Kindle Fire was its best-selling product, it declined to provide any specifics on sales.



Apple, meanwhile, is believed to have just come off its best-ever quarter for iPad sales, with the just-concluded holiday quarter projected to have surpassed the company's previous best of 11.2 million iPads sold in last year's September quarter. Apple will reveal its quarterly earnings, including specific iPad sales figures, in its earnings call next Tuesday.









As Amazon allegedly cuts its Kindle Fire orders and Apple prepares to announce its latest iPad sales, anticipation continues to build for a rumored third-generation iPad. Reports have indicated that production of the next-generation model is already underway, and the device is expected to go on sale in March.



One rumor this week claimed that Apple is planning to hold an event in early February to announce its next iPad before an official launch in March. Such a move would be unusual for Apple, as the company usually begins selling a product very soon after it is announced, but some rumors have suggested that Apple will continue to sell its current iPad 2 at a reduced price to take on cheaper competitors like the Kindle Fire.
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Comments

  • Reply 1 of 53
    rbonnerrbonner Posts: 635member
    Any word on the return rate on the Fire since the holiday season?
  • Reply 2 of 53
    Quote:
    Originally Posted by rbonner View Post


    Any word on the return rate on the Fire since the holiday season?



    They don't even post their sale numbers; do you really think we'll ever know about returns?
  • Reply 3 of 53
    drdoppiodrdoppio Posts: 1,132member
    Quote:
    Originally Posted by rbonner View Post


    Any word on the return rate on the Fire since the holiday season?



    I doubt it's any higher than before the holidays, considering that the average rating on Amazon has gone up a notch (4.0 stars from 3.9).



    With many cheap tablets selling close to $200 (and some even below), I start to think that Amazon may be breaking even on the Kindle Fire... No signs of a price increase despite the reportedly good sales, either...
  • Reply 4 of 53
    Quote:
    Originally Posted by rbonner View Post


    Any word on the return rate on the Fire since the holiday season?



    Return as in taking back or return as in revenue made in after sales of content?



    Content sales are reportedly $136 per unit according to RBC Capital.



    http://www.forbes.com/sites/ericsavi...than-expected/



    [I would expect that they might cut orders in half but imo there will still be units made in this quarter available next Christmas [imho].)
  • Reply 5 of 53
    There's an apparent typo here Katie:



    >>Sources from Amazon's supply chain in the Far East no more than 2 million iPad sales from Apple over the holiday season.
  • Reply 6 of 53
    Quote:
    Originally Posted by JBHoule View Post


    There's an apparent typo here Katie:



    >>Sources from Amazon's supply chain in the Far East no more than 2 million iPad sales from Apple over the holiday season.



    You beat me to writing the same thing! Should be Kindle Fire sales from Amazon, I think.



    If this is true, Kindle Fire is a flop. I must say I'm surprised - I believed the low price would really expand sales a lot, even for an inferior device. I guess buyers are more discriminating than I thought.



    I wonder what content margins are - if sales are $136 per unit, and increasing as people continue buying over time, that seems to vindicate the Fire's break even business model, even as sales must be disappointing.



    D
  • Reply 7 of 53
    I don't understand why people get so offended by any kind of competition in the tablet market. Kindle Fires appeal to different buyers and not everyone wants to be in on the Apple ecosystem despite it being the best in my opinion for most digital content.
  • Reply 8 of 53
    Quote:
    Originally Posted by PBRSTREETG View Post


    I don't understand why people get so offended by any kind of competition in the tablet market. Kindle Fires appeal to different buyers and not everyone wants to be in on the Apple ecosystem despite it being the best in my opinion for most digital content.



    Offended?



    Me thinks you are reading too much into the comments.
  • Reply 9 of 53
    The only reason that I could imagine there would be a significant delay (a month vs a week) between and iPad3 announcement and launch, is to allow developers to update their apps to retina specs.



    On announcement day they release the beta for iOS5.1, then a month later it goes public upon the release of the iPad3.



    Since there was no resolution change between the iPad1 and iPad2, developers didn't need to change their apps for the new hardware.
  • Reply 10 of 53
    gatorguygatorguy Posts: 20,764member
    Digitimes is suddenly a reliable source? Perhaps only as long as they aren't writing about Apple products?
  • Reply 11 of 53
    aizmovaizmov Posts: 989member
    Still the best selling tablet on Amazon.com
  • Reply 12 of 53
    Quote:
    Originally Posted by Gatorguy View Post


    Digitimes is suddenly a reliable source? Perhaps only as long as they aren't writing about Apple products?



    So you don't agree with the 3 million units figure for this quarter or the 6 million units figure for the holiday quarter?
  • Reply 13 of 53
    solipsismxsolipsismx Posts: 19,566member
    Quote:
    Originally Posted by Aizmov View Post


    Still the best selling tablet on Amazon.com



    Best selling tablet model on Amazon. It's quite possible that among the 18 models of iPad 2s selling on Amazon that the iPad would outsell the Kindle Fire. Same goes for any product that is split among many models, like the Kindle eReaders.
  • Reply 14 of 53
    aizmovaizmov Posts: 989member
    Quote:
    Originally Posted by SolipsismX View Post


    Best selling tablet model on Amazon. It's quite possible that among the 18 models of iPad 2s selling on Amazon that the iPad would outsell the Kindle Fire. Same goes for any product that is split among many models, like the Kindle eReaders.



    It was a joke post. Plus Amazon doesn't officially sell the iPad, 3rd party sellers do and they charge more than suggested retail price.
  • Reply 15 of 53
    shompashompa Posts: 343member
    Quote:
    Originally Posted by island hermit View Post


    Return as in taking back or return as in revenue made in after sales of content?



    Content sales are reportedly $136 per unit according to RBC Capital.



    http://www.forbes.com/sites/ericsavi...than-expected/



    [I would expect that they might cut orders in half but imo there will still be units made in this quarter available next Christmas [imho].)



    Lifetime content sales are predicted to 136 dollar/unit.

    Majority of this content would have been bought from Amazon by other ways if they didn't have a Kindle Fire.



    The Kindle fire looses money for Amazon. They can build it for around 200 dollars, but that does not include research, design, warranty and so on. Amazon will post huge losses thanks to this project. Just like the old .com days. Market share by loosing money.



    Google post much lower profit then expected last day. Android is just like Fire, a huge money looser for Google. This is the only way Google/Amazon can compete with Apple. If I where a shareholder I would be angry at a strategy that looses money.
  • Reply 16 of 53
    Not news until they do.
  • Reply 17 of 53
    matrix07matrix07 Posts: 1,993member
    Quote:
    Originally Posted by Gatorguy View Post


    Digitimes is suddenly a reliable source? Perhaps only as long as they aren't writing about Apple products?



    Well I agree with you for once. It's a crap source.
  • Reply 18 of 53
    lkrupplkrupp Posts: 7,162member
    Quote:
    Originally Posted by PBRSTREETG View Post


    I don't understand why people get so offended by any kind of competition in the tablet market. Kindle Fires appeal to different buyers and not everyone wants to be in on the Apple ecosystem despite it being the best in my opinion for most digital content.



    It's only the trolls that are offended...by the fact that Apple exists. Look, let us Apple fans have our day will you. For years we have had to endure mockery, denigration, "sheeple" and "lemming" comments, predictions of doom and gloom, and general dismissal by the nerd herd and tech bloggers. Apple is kicking these people in the nuts now. Now it's our turn to call the Fire a failed POS if we want to. What's good for the goose should be good for the gander.
  • Reply 19 of 53
    gatorguygatorguy Posts: 20,764member
    Quote:
    Originally Posted by island hermit View Post


    So you don't agree with the 3 million units figure for this quarter or the 6 million units figure for the holiday quarter?



    If Digitimes was the only source indicating that, I wouldn't run with it as probably accurate.
  • Reply 20 of 53
    Quote:
    Originally Posted by PBRSTREETG View Post


    I don't understand why people get so offended by any kind of competition in the tablet market. Kindle Fires appeal to different buyers and not everyone wants to be in on the Apple ecosystem despite it being the best in my opinion for most digital content.



    Nobody here cares about the so-called "tablet market" except Android-obsessed DED and The Usual Suspectz. We're all about the iPad market. Have you forgotten that, before 2010, there was effectively no tablet market? Microsoft had been pushing it for decades. Even Eric Schmidt believed that tablets were done and over. Now everyone is running around screaming "omg tablet market!!!" and what has changed? Oh, right: the iPad.



    The only people who are "offended" are folks who constantly post stuff about "competition" on these forums. They are irked that Apple has done well and want Apple fans to acknowledge how great the competition is also. They think Apple fans are so stupid for not thinking like them, and they're constantly berating the "iSheep" in these forums. They forget: there would be no "omg tablet market!!!" today if the iPad wasn't a huge success and you know who made the iPad a huge success? The iSheep they hate soooo much. One sale at a time. That's what really irks them. We legitimized the whole "omg tablet market!!!"
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