GoPro beats revenue expectations – Shares drop because of large loss and Competition

GoPro released their quarterly financials after market close yesterday.

Here are the highlights:

  • Revenue: $244.6 million (up 38% compared to last year)
  • Net Loss: $19.8 million (compared to $5.1 million a year ago)
  • Operating Expenses: $119.5 ($62.8 million last year)

Even though GoPro beat analyst expectation on revenue (largely driven by strong demand for the Hero3+ Black Edition) the shares dropped in after-hour trading and this morning are down around 10% in pre-market trading as well. The main reasons are the biggest than expected net loss and uncertainty when it comes to keeping the growth going and continuing to hold the market share when larger competitors get serious about the action camera market.

The fact is that GoPro has an extremely loyal customer base and have created an extremely strong brand within this market segment, something competitors would have to catch up on. In addition to that the company is focusing on expanding its digital media offering. Just recently they launched their on-demand channel for Xbox One and you only have to do a quick search on YouTube to see how much user content is being generated.

There are also other revenue streams for the company. In June it was announced that Mini was integrating GoPro cameras and the company is working with additional automakers.

Competitors will come in and challenge GoPro in a growing market that is for certain but GoPro can continue to dominate this market and keep investors happy if they introduce new innovative products and utilize their loyal user base with digital / social content.

One thought on “GoPro beats revenue expectations – Shares drop because of large loss and Competition

  1. Pingback: GoPro Launches 3 New Cameras – 4K Video Capable, Touch-Screen and Cheapest GoPro Yet | The Tech Globe

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