They're still losing money. The publishers demand more than that per book so the book might cost Amazon $13.00 to buy from the publisher (even as an ebook, because publishers haven't adapted to the new business model) and have a list price of 15.99, Amazon would sell it for 9.99 and take a three dollar loss.
But eventually Amazon will quit taking a loss and the publishers will either have adapted to the new price point or Amazon will leverage them into doing so in order to have a place at the table. (Like Wal-Mart does.) And so that's a good and bad thing - it takes power away from the publishers (which is good, because they generally act like idiots) and puts it in the power of Amazon (they generally behave themselves, but monopolies are always bad) - but ULTIMATELY good because the publishers will take more risks with other retailers in order to undermine Amazon's power and that will hopefully lead to cheaper prices and less DRM across the board (much like music has played out.)
But we'll see. There's no real reason to imagine it will work out that way, but the iTunes store/music model is a fairly strong economic... well, setup? It's a rational process, at any rate.
The kicker is that books are a much smaller market than music, and not nearly as many people are going to be interested in ereaders or ebooks and that might change the nature of the game somewhat.
But who knows!?
