By Marcus Leach

Amazon have reported that profits for the final quarter of 2011 were down from $416 million net in 2010 to $177 million.

They also went on to warn that results this coming year will be worse than initially expected.

The fall came despite an increase in revenues during the period to $17.43bn, up 35%.

The company said US sales of its popular range of e-book readers, The Kindle, surged during the nine weeks to the 31 December, increasing by 177% on the previous year.

The sales coincide with the release in the US of the company's new touch screen Kindle Fire tablet.

"We are grateful to the millions of customers who purchased the Kindle Fire and Kindle e-reader devices this holiday season, making Kindle our bestselling product across both the US and Europe," said Jeff Bezos, CEO of

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