Making money on the device directly is simple: You charge more for it. Keeping in mind that Amazon makes a pretty good margin on the content it sells with negligible infrastructure requirements (the kindle infrastructure would be negligible compared to the rest of Amazon.com + AWS), they don't need to make money on the device itself.

The company that uses the revenue model of making money of the device and selling the content for a negligible profit is Apple. That's how they run the iPod department for one. Devices are sold at a high margin but almost all the revenue for itunes sales go to the content providers.