Amazon sees weaker-than-expected Kindle Fire HDX shipments in 4Q13 - Digitimes

Amazon sees weaker-than-expected Kindle Fire HDX shipments in 4Q13

Jim Hsiao, DIGITIMES Research, Taipei [Wednesday 15 January 2014]

Thanks to falling prices and satisfactory functionalities, entry-level tablets from brand vendors has been undermining demand for mid-range and high-end models, and they formed a main driver of the tablet market during the year -end shopping season in 2013. Observing Amazon’s tablet promotions and related shipments from the supply chain, Digitimes Research found that the US-based vendor’s entry-level Kindle Fire HD is enjoying better sales than its high-end Kindle Fire HDX.

Amazon announced in early December 2013 that its Kindle series, which includes both tablets and e-book readers, has achieved a sales record during the Thanksgiving holidays, which some market watchers believe were mainly contributed by the high -end Kindle Fire HDX models. However, Amazon actually devoted most of its marketing resources to promoting the Kindle Fire HDX, a tell-tale sign that the high-end products were not selling as well as thought.

During the year-end shopping season of 2012, Amazon offered no price cuts for its Kindle Fire HD, which was then its high-end model. But for the same periord in 2013, the company not only offered price cuts for its high-end Kindle Fire HDX, the reductions were also higher than those for the entry-level Kindle Fire HD. Amazon’s new interest-free installment service is also available only for the HDX models.

The above moves show that Amazon’s promotions for high-end models were far stronger than those for the entry-level models during 2013 year-end marketing campaigns. Since Amazon also reportedly has been reducing orders for high-end models from its supply chain, Digitimes Research believes Amazon had to make moves to shore up the Kindle Fire HDX’s weaker-than-expected sales.

The entry-level Kindle Fire HD’s friendly pricing and performances in terms of multimedia content playback and app operation are already able to satisfy most Amazon users’ demand, making it the mainstream model among Amazon’s devices in 2013. With the Kindle Fire HDX devices having weaker-than-expected shipments and the entry-level Kindle Fire HD enjoying shipment growths and rising demand, Digitimes Research estimates Amazon’s fourth-quarter 2013 tablet shipments at 4.22 million units, down 100,000 units from its original forecast .