Is Amazon’s (AMZN) big gamble paying off? After struggling, the company reported first-quarter earnings last week that were better than expected, causing the stock to spike more than 14%. The Kindle Fire, Amazon’s low-price (in fact, some analysts believe it’s being sold at a loss) entry into the tablet market, is apparently doing well as the company continues to emphasize digital products, which have higher margins. Amazon’s Web Services unit also bears watching as a small but fast-growing cloud services business. This division also has high margins and could be an important part of the company’s continued transformation into a digital products company.
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Actually, I'm starting to see some news that the kindle fire is plateauing and maybe even starting to lose some steam due to the ipad. I think that Apple's strategy to drop the price of an entry level ipad 2 by $100 is going to really cut into kindle sales.
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