E-reads starts by scanning in the physical books. They do that because most writers don't have the final versions of the texts on their computers. (It's tedious and time-consuming work to enter all the corrections from the copy-edit process, and the galleys-correction process.) So that takes a while. Then they do their own formatting, and in many cases they're formatting for a POD paper edition, also, if the book has been reverted by the original publisher. They probably don't have the rights to the original artwork, so they find cheap art. This all takes time, and they don't have a huge staff to do it. Then everything has to be proofed, and converted and encrypted, and...well, you get the idea.
I have no inside knowledge, but I doubt they've made any net money on this, so far. They essentially advance production costs to the writer, then recover it from royalties, but for people like me, that's a long time in being recovered. We get a pretty good royalty rate, but sales are very low. So, it's a business model on which the jury is still out.
The public perception is that authors should be able to simply stream their text into some kind of ebook-maker black box, and it comes out effortlessly, but in truth it's a lot harder than that. (Which is one reason ebooks aren't yet cheaper than paper books. There might not be printing and paper costs, but there are many other costs.)