Amazon has reportedly been laying off dozens of engineers at Lab126, a special division within the company that works on hardware development. Why? Due to terrible Amazon Fire Phone sales over the last year.
Amazon Lab126 is responsible for the Kindles, new Amazon Echo, and the new Amazon Dash Buttons all in addition to the Fire Phone. The Fire Phone had a very rough start and its outlook has not improved for the $650 device with lacking features.
To date, Amazon has only sold around 35,000 units of its phone and has written off $170 million for the Fire Phone thus far.
If Amazon wants to remain relevant in the hardware market it needs to refocus its attention on what it does best, Kindle. Their Kindle E-Books readers are still the most popular in the world and with their new development of Amazon Echo, they also may have carved out another niche but it’s still too soon to tell.
One thing seems to be true is that Amazon Fire Phone 2 appears to be on indefinite hold for the time being.