Amazon continues to try to shift unsold inventory of its unpopular smartphone, the Fire Phone, by slashing the price-tag. It’s currently discounting a U.K. version of the device that’s locked to the O2 carrier’s network to £99 ($150), down from £399.
The handset launched as an O2 exclusive in the U.K. market last September, hence the carrier network lock despite the device being sold off contract. Early buyers also got Amazon Prime membership bundled in when they signed up for a £33 per month two-year contract.
This is just the latest in a series of drastic price cuts for the device — including earlier this month in the U.S. where it dropped the price to $189 off contract and threw in Amazon Prime membership as a sweetener. Prime usually costs around $100 per year in the U.S. Just two months after launch, Amazon was also pushing the phone at 99 cents on two-year contract with AT&T.
Amazon may be renowned for reporting paper thin profits, with its focus on expanding revenues by continuing to push out the boundaries of its ecommerce empire, but the Fire Phone debacle has dented its bottom line in a way that makes investors uncomfortable.
In its Q3 in October the company reported a larger than expected loss and lower revenue, leading its shares to drop 10%. Amazon was also forced to admit it had taken a $170 million write-down “primarily” due to the Fire Phone — with unsold inventory standing at some 83 million handsets in Q3.
The company is due to report its Q4 earnings tomorrow. It remains to be seen how many phones it will have shifted over the holiday quarter, and at what cost — given these swinging price-cuts.