Amazon has implemented a price increase of up to 55% on its main devices sold in Brazil, covering the Kindle, Echo, and Fire TV lines. The company attributed this change to rising costs in the global memory and storage component supply chain.
In an official statement directed to Tecnoblog this Monday, August 24th, Amazon justified the need to recalibrate its price list in the national territory. The company stated that the consumer electronics industry is facing considerable increases in expenses for memory and storage components. Although Amazon tried to absorb these increases for as long as possible, it had to adjust the values of its products, reiterating its commitment to offering good products at accessible prices.
An analysis of the new values, as reported by TecMundo, showed that 11 items in the brand's catalog were affected, with entry-level and the newest models being the most impacted. Some high-end devices, such as the Kindle Scribe and Echo Studio, managed to maintain their initial prices.
A clear pattern is observed in the variation: the simpler the device, the greater the percentage impact on the price. For example, the basic Kindle and the Echo Spot (2024 model) saw increases exceeding 50%, while the Kindle Colorsoft Signature Edition registered a smaller rise of only 6.06%.
This difference is due to the cost composition of each device. In entry-level electronics, RAM and storage chips constitute the largest portion of the total manufacturing cost. With the increasing cost of these components, the profit margin, which is already naturally reduced in these models, makes it difficult for the manufacturer to absorb the loss.
Conversely, in premium devices, the production cost is distributed across various other elements, such as high-definition screens and finishing materials. This allows the company to make adjustments to the final price with smaller pass-throughs.
The fundamental reason for the cost increase lies in the semiconductor industry's redirection to meet the demands of artificial intelligence companies. Key suppliers in the sector, including Samsung, SK Hynix, and Micron, concentrated their efforts on producing High Bandwidth Memory (HBM), which is crucial for AI data centers and offers higher profitability.
This migration resulted in a sharp decrease in the availability of conventional memories, those used in smartphones, computers, and smart home devices. Forecasts indicate that this situation is not temporary, as manufacturers have already negotiated almost all the memory stock projected for 2027. It is expected that the supply shortage and high prices will persist, at least until 2028, with some estimates extending the effects of this crisis until the end of the decade.