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VIDEOPrior to Amazon Earnings, eBook Sales Increase
However, Wall Street is still mixed as the retailer prepares to report second quarter earnings on Thursday.
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Yesterday, Amazon (AMZN) CEO Jeff Bezos said in a statement that growth of the Kindle “reached a tipping point.” Sales of the Kindle have tripled since the company lowered its price to $189 from $259. Amazon cut the price of the Kindle following a similar move by Barnes & Noble (BKS) to cut the price of its Nook e-reader.
Barnes & Noble, the nation’s largest bookstore chain, also said it's “seen a big uptick” in sales since it cut the price of its e-reader. Sony (SNE) also said that sales of ebooks were growing steadily and that e-reading devices were triple the level of a year earlier.
Amazon painted a bullish picture for ebook sales saying it sold 180 Kindle books for every 100 hardcover books it sold.
“In addition, even while our hardcover sales continue to grow, the Kindle format has now overtaken the hardcover format," Bezos said. "Amazon.com customers now purchase more Kindle books than hardcover books -- astonishing when you consider that we’ve been selling hardcover books for 15 years, and Kindle books for 33 months."
Amazon’s ebooks can also be read on Apple’s (AAPL) iPad and iPhone, as well as other devices.
Wall Street is mixed on Amazon. Just yesterday Jefferies said it expected Amazon to report strong second-quarter results. The company has a Buy rating and a price target of $160. Last Wednesday UBS said Amazon will beat second-quarter estimates. UBS has a price target of $170 and a Buy rating on the stock. BofA/Merrill isn't as optimistic; on Thursday the company downgraded Amazon to Neutral and placed a price target of $140 on shares.
Amazon will report its second-quarter results this Thursday after the close of trading.
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