GoPro tops revenue estimates amid signs of turnaround | Top Stories
(Reuters) – GoPro Inc topped Wall Street estimates for second-quarter revenue and reported a smaller-than-expected loss on Thursday, as the action-camera maker rebuilds its business.
FILE PHOTO: A GoPro camera is seen in this illustration photo January 9, 2018. REUTERS/Thomas White/Illustration/File Photo
The company’s shares were flat after the bell in choppy trading, giving up an 8 percent gain earlier in the session.
GoPro’s trademark action-cameras, once a must-have for surfers, skydivers and other action junkies, have been hit by intensifying competition from pocket friendly smartphones with powerful cameras and a fast saturating market.
The stock, a one-time investor favorite following a blockbuster market debut in 2014, is down nearly 21 percent this year.
GoPro has since launched a cheaper $200 entry level Hero camera, stepped up marketing efforts, cut jobs and exited its Karma drone business to check losses.
“We believe GoPro will be profitable in the second half of 2018,” Chief Executive Officer Nicholas Woodman said in a statement.
The company also said its inventory in the latest quarter was the lowest since the second-quarter of 2014.
“Against our estimates, average selling prices were better and margins were better than guidance for high-20s, indicating strong sell-through of HERO5 and HERO6 against lower-priced HERO, and not too much discounting in the quarter,” said Wedbush analyst Alicia Reese.
GoPro said its ‘Plus’ subscription services, a focus area for the company, had 160,000 active paying subscribers at the end of the second quarter.
The company’s net loss widened to $37.3 million, or 27 cents per share, in the quarter ended June 30, from $30.5 million, or 22 cents per share, a year earlier.
Excluding items, the company lost 15 cents per share, smaller than analysts’ expectation of a loss of 22 cents.
Revenue fell 5 percent to $282.7 million, but topped estimate of $270.2 million, according to Thomson Reuters I/B/E/S.
Reporting by Sonam Rai in Bengaluru; Editing by Sriraj Kalluvila