Upon announcing the Kindle Fire last week, we were left stunned by the $199 price tag for the tablet—not just because of how awesome that is, but also how impractical it seemed. “Surely Amazon must be losing money,” sang the critics.

Well, according to tech firm UBM TechInsights, the Kindle should have a manufacturing cost of only about $150—its most expensive parts estimated to be a $60 display and $20 processor—therefore only leaving shipping and distribution costs. In comparison, the iPad 2 is estimated to have production costs of about $270—packing a more expensive screen as well as flash memory, for instance—yet it retails for $499.

As if it wasn’t glaringly obvious before, the Kindle Fire may not be the nifty device the iPad is, but at least Amazon is concerned about our wallets.

[via Business Insider]