For the first time, sales from Kindle books outsold their paperback counterparts.

While this was expected, it came sooner than anticipated. Since the beginning of January Amazon has sold 115 Kindle books for every 100 paperbacks, and ebook sales outsold hardcovers three to one. Amazon's sales increased 36 percent to $12.95 billion during the fourth quarter.

While Amazon did not report how many actual Kindles the company sold, its earning's release did say the company sold millions of the third generation version of the reader.

Sales for both Kindles and Kindle books fueled the company's other milestone: Last quarter was the company's first $10 billion quarter.

Looking forward, Amazon expects first quarter 2011 sales to grow between 28 percent and 39 percent compared to the same period last year.  Operating income is forecasted to decline between thirty four percent and two percent.