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Kindle Fire may have cost Apple $1 billion or more in holiday iPad sales

Amazon’s new Kindle Fire was a hot item during the holiday shopping season, and one analyst believes the new Amazon tablet may have cost Apple well over $1 billion in holiday iPad sales. Morgan Keegan analyst Travis McCourt on Tuesday lowered his December-quarter iPad sales estimate from 16 million units to 13 million. Hot sales of the Kindle Fire ahead of the holidays are responsible for trimming sales of Apple’s iPad by between 1 million and 2 million units, the analyst believes, making Amazon’s new slate the main reason for McCourt’s slashed forecast. Read on for more.

On the low end of McCourt’s estimate, the Kindle Fire cost Apple at least $500 million considering the iPad 2’s $500 entry-level price point. If the Kindle Fire was indeed responsible for cutting iPad sales by 2 million units, Amazon tablet sales cost Apple a minimum of $1 billion. Considering the range of available iPad 2 models that sell for between $500 and $830 each, however, that figure would likely be significantly higher.

Amazon announced last week that it sold more than 4 million Kindles during the holiday shopping season, noting that the Kindle Fire was its most popular device. McCourt believes total Kindle Fire sales for the 2011 holiday shopping season were between 4 million and 4.5 million units.

Zach Epstein

Zach Epstein has been the Executive Editor at BGR for more than 10 years. He manages BGR’s editorial team and ensures that best practices are adhered to. He also oversees the Ecommerce team and directs the daily flow of all content.

Zach first joined BGR in 2007 as a Staff Writer covering business, technology, and entertainment. His work has been quoted by countless top news organizations, and he was recently named one of the world's top 10 “power mobile influencers” by Forbes. Prior to BGR, Zach worked as an executive in marketing and business development with two private telcos.