The original Amazon's Kindle Fire was unveiled to great acclaim last Autumn and was widely hailed as the first viable competitor for iPad.
At first all looked good, with Q4 sales at an estimated 4.8m, but thenQ1 delivered just 700,000.
The tablet has still to be launched outside the US.
Now Reuters reports the Kindle Fire 2 is being readied for a Q4 launch in the US, and will sport an 8.9-inch screen, outmeasuring the original seven-inch Kindle Fire, while bringing it closer to the best-selling 9.7-inch iPad.