Amazon (AMZN) reportedly forecasts a USD 612mln gross loss for its devices business this year (vs. internal target of USD 438mln loss), as surging memory chip costs squeeze margins, Business Insider reports, citing an internal document

Amazon (AMZN) reportedly forecasts a USD 612mln gross loss for its devices business this year (vs. internal target of USD 438mln loss), as surging memory chip costs squeeze margins, Business Insider reports, citing an internal document.

Leaks of internal divisional targets ahead of a print follow a familiar pattern for large-cap tech: the device unit at this company has long been run as a loss-making funnel for its services and advertising ecosystem, so a widening loss there has historically been tolerated provided the high-margin segments absorb it. The transmission channel worth isolating is input cost rather than demand: surging memory pricing is a component cycle story, and episodes of sharp DRAM and NAND cost inflation have tended to compress hardware margins across the whole device and consumer electronics peer set, not just one issuer, which is how read-across to suppliers and rivals typically forms. The gap between the internal target and the forecast matters more than the absolute number, since it signals procurement assumptions made earlier in the cycle are now stale. What bears watching is whether management addresses component cost pass-through on the next earnings call and whether the loss is framed as temporary input inflation or as a structural reset of the hardware strategy. As a single-document leak rather than guidance, the figures carry attribution risk and are liable to revision.