GoPro Inc. (NASDAQ: GPRO)
GoPro Earnings
Wednesday after the market closed, GoPro Inc (GPRO) announced earnings that missed expectations and drove share prices to record lows. Earnings came in worse than expected with a loss of 25 cents per share on $436.6 million in revenues while analysts were looking for a break even quarter on $435 million in sales, which was lowered from over $500 million before GPRO announced a warning on holiday sales and outlook before earnings. GPRO also announced a dismal outlook with predicted sales to come in the range of $160-180 million, far from analyst expectations of $291 million, and they are also going to cut their workforce.With hurting sales and increased competition, GPRO is going to have to get creative on how it will dig itself out of this hole. They will really have to streamline their operation and try to add more value to their products and services otherwise they will continue to see their share price go down. They have the resources to turn this around so lets see how GPRO reacts to all this negativity. This was a terrible earnings release with an ominous outlook and I’d expect plenty of downgrades in the near future.
CEO Comments
“In Q4 we reduced the price of HERO4 Session to $199, positioning it as the best entry-level product we’ve ever made. The new price resulted in more than a three-fold increase in sell-through rates in December and sell-through continues to be strong. Session price, small form-factor and simple one-button design are clearly resonating with consumers. In several respects business is good. However our growth rates has slowed and some analysts have attributed this to competitive threats and our ability to address the market beyond our core customer. That is not how we see it.” (SeekingAlpha)
GPRO Technicals
Shares took a pounding in the post market session to lows of $8.50 before rebounding to the high $9 range, almost a 20% drop. Looking at the daily chart you can see that shares have been in a free fall after reaching highs of $98.47 back in September and are now trading below $10 per share or all time lows. What started off as a hot IPO is now one of the worst performing stock on the street. We should see some support at the premarket lows of $8.50 and resistance will be met at the $10 level. With prices this low I wouldn’t be surprised if someone came in and tried to buy this company at these prices. In the mean time, I will not be touching this stock as there is too much uncertainty. Expect shares to remain under pressure until a major catalyst arrives.
Company Profile
GoPro, Inc. manufactures and sells camera and camera accessories. It provides mountable and wearable cameras and accessories, which refers as capture devices. The company sells products through retailers, wholesale distributors and on the website. GoPro was founded by Nicholas Woodman in 2002 and is headquartered in San Mateo, CA. (MarketWatch)
