Shares are -8.7% after the e-retailer presented a mixed report about its 4Q results, and projected a decline in its 1Q operating profit. Amazon generated net income of $177M in the last three months of 2011, down 57.5% from the same period in 2010, on revenues of $17.4B, up 34.6%. The revenue figure fell short of the $18.2B that analysts projected. Earnings, at 38 cents a share, handily beat the 19 cents forecast. The profit drop is partly due to Amazon’s expenditures to build new fulfillment centers, and sales of its Kindle e-readers and tablets – priced below cost in order to gin up sales of books and other media. The company says that Kindle sales were up 177% over the holiday season. But investors were surprised to see that profits are still under pressure. Amazon forecast that operating income in 1Q will come in anywhere from a $200M loss to a $100M profit — which means it will be down as much as 162% or as little as 69% from the period in 2011.

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