Colin Gillis, an analyst with BGC Financial stated, "We don't know the economics of these e-books. In our opinion, they are losing money on a lot of the bestsellers sold as e-books."
This information, announced only a few days before the company’s earning report, is likely in response to concerns about the iPad’s impact on Amazon’s sales. The ebook market is clearly growing rapidly, although with so many devices and platforms available it is quite competitive. Amazon has stated that it intends to compete with the iPad and other such devices by providing a purpose-built device for “serious readers”, and the Graphite Kindle DX, released earlier this month, maintains this stance, providing higher contrast, faster page turning, and generally improving upon the reading experience of its predecessors.
A review of the Graphite Kindle DX can be found here, and more information on Amazon’s recently announced sales statistics can be found in an LA Times article here.