Know How Many Kindles Amazon Has Sold? 240,000

Ever since Amazon (AMZN) launched the Kindle last November, we’ve been wondering about just how successful it’s been. The electronic book initially sold out and supplies have been tight. The Kindle is such a small part of Amazon’s overall business that the company does not break out how many it’s sold. But we found out anyway: 240,000 Kindles have been shipped since November, according to a source close to Amazon with direct knowledge of the numbers.

Doing a little back of the envelope math, that brings total sales of the device so far to between $86 million and $96 million (the price of the device was reduced to $360 from $400 last May). Then add the amounts spent on digital books, newspapers, and blogs purchased to read on the device, and you get a business that has easily brought in above $100 million so far. (Each $25 worth of digital reading material purchased per Kindle, add $6 million in total revenues).

These numbers jell with what Wall Street analysts have been predicting. And if a new Kindle comes out targeted at the textbook/school market, sales could ramp up higher.

Scott Devitt, an analyst at Stifel, Nicolaus & Co., predicts that Amazon is on track to sell 500,000 to 750,000 more Kindles over the next four quarters (including this one). He estimates that Kindle owners will buy an additional $120 to $150 worth of books and other content for each device, bringing the total revenues over that time period to somewhere between $225 million and $355 million. Based on that, he values the Kindle as a $1 billion business for Amazon.

Back in May, Citi analyst Mark Mahaney was estimating that total sales of Kindles this year would only reach 189,000. That number may have already been surpassed (depending on how many of the 240,000 units Amazon sold before January). His estimate called for 467,000 units to be shipped next year, and 2.2 million in 2010, resulting in total revenues going from $60 million in 2008 to $741 million in 2010. It might be time for him to revise those numbers upward. (Below is his model from May):

Original post

Comments

[Louie Junior:]

Good Article, although I don't believe Amazon will see this kind of parabolic growth. Sure, early adopters will pay $300+ for the gadget and $10 per book -- but the masses will not. Amazon is going to have to ultimately give away the hardware and charge for the E-books, or vice versa, before joe six-pack becomes interested.

Somewhere down the road, you need to cut your estimate in half.

2008 Aug 02 09:10 AM

[pshah:]

Agree with Louie - I am not sure how you can assume a quadrupling of Kindle sales for each of the next two years. Early adopters have already bought and it would have to a lot more affordable for the rest to be convinced.

2008 Aug 02 12:27 PM

[arje81:]

Kindle sales may hit a wall, as long as they are tied exclusively to Sprint, which has poor coverage in my area. Of course, they don't mention this limitation before the purchase.

2008 Aug 02 01:26 PM

[AMZN skeptic:]

I commute on a NYC commuter line filled with prosperous people that have time on their hands. If 240,000 have been sold, how come I've only seen one so far?

2008 Aug 02 06:37 PM

[David Tsao:]

Mark Mahaney also had AMZN price target for $119/share back in January. His forecast model back in May assumed there would be an adoption rate at 50% of what iPod's numbers when they first came out. At the end of the day, these targets may come to fruition, but the the forecast wasn't based on any sound reasoning.

2008 Aug 02 10:02 PM

[TonyH:]

I also believe that the numbers are OVERoptimistic, especially, with the consumer being 'pressed' for money. But even if they were realistic, does AMZN have any sort of such capacity to go that high saleswise?

2008 Aug 03 03:35 AM

[Kindle Fan:]

@arje81: As a Kindle user since launch, I know they (Amazon) have always said it's Sprint's network, and even include a coverage map on the Kindle Product detail page. The text says (and has since launch)

"Wireless Access with Whispernet™
Whispernet utilizes Amazon's optimized technology plus Sprint's national high-speed (EVDO) data network to enable you to wirelessly search, discover, download, and read content on the go.

Unlike WiFi, you don't have to find a hotspot. Amazon pays for Kindle's wireless connectivity so you will never see a monthly wireless bill for shopping the Kindle Store. There is no wireless setup—you are ready to shop, purchase and read right out of the box.

Note: There is no wireless coverage available currently on Sprint’s data network for Kindle in Montana and Alaska. "

with a coverage map link.

2008 Aug 04 09:01 PM