Shock horror! Amazon makes profit on Kindle 2 sales!

An iSuppli teardown estimates that Amazon's $359 Kindle 2 is actually made up of parts that add up to $185.

An iSuppli teardown estimates that Amazon's $359 Kindle 2 is actually made up of parts that add up to $185.

The problem with these teardown studies is that they don't take into account R&D, marketing, distribution, warranty and so on. When you take that into account, that $174 "profit" will be shaved down considerably.

There will be a profit on each Kindle 2 sale that Amazon makes, but it won't be anywhere near the $174 suggested by the teardown.