We always knew that Amazon was selling its tablets at a small loss, making up the difference in advertising and e-book sales.Now we have some specifics — Amazon’s $79 Kindle costs $84.25 to make, reports Main Street.
Market research firm iSuppli determined that the components cost $78.59 and assembly costs $5.66.
The $84.25 figure ignores other essential costs such as software and licensing fees, meaning Amazon spends more than $5.25 to sell you a Kindle.
Main Street writes that the costs are bigger for the Kindle Fire. Amazon sells those at a $10 loss each. It’s no problem to lose a little more on the Fire because it can direct users to spend money on more Amazon services like Cloud Drive or Video On Demand.