Why Is Jeff Bezos Smiling?

Because this quarter, in the midst of -- say it with me now -- the worst global recession in 70 years, profit at Amazon.com grew by 24 percent, to $177 million.

You read that right. Amazon's financials didn't stagnate, hold steady, or even increase slightly -- they flew off into the stratosphere. Sales also grew by a whopping 25 percent, ignoring currency fluctuations, according to the quarterly results announced today.

Although these particular numbers come as a shock, it's no surprise that e-commerce is benefiting from the downturn. Anemic consumer spending is choking off the weakest brick-and-mortar retailers. Circuit City, Linens 'n Things, The Sharper Image, CompUSA and other major chains have joined the extinction list in the last year and a half, and online vendors like Amazon are wooing their former customers.

However, I do wonder how much of this stunning performance is due to a one-time Kindle Effect. Amazon released the second generation of its revolutionary e-reader in February to lots of critical praise and better-than-expected sales. Exactly how popular the Kindle is, however, remains a state secret. (For proof of Bezos's tsar-like reticence, witness Charlie Rose trying to charm the answer out of him. Skip to 34:15 for the pertinent bit, although the whole conversation is interesting.) If Amazon's strong profit growth this quarter was really due mostly to the Kindle, Bezos will have to channel Steve Jobs and iterate the hell out of his next-gen reading tablet in order to keep producing these kinds of results.