GoPro Stock Drops 30 Percent After Announcing Layoffs

Javier Stokes
January 9, 2018

But GoPro's results weren't lackluster. The company's stock (GPRO) plunged almost 30 percent in response to the announcement. Apple would certainly have the cash to buy GoPro this year, especially if it repatriates a massive chunk of the cash hoard it has overseas, as most analysts generally expect it to do. Demand for its products was far weaker than it expected just a few months ago. "Despite significant marketing support, we found consumers were reluctant to purchase HERO5 Black at the same price it launched at one year earlier", reads GoPro's press release.

GoPro is looking to sell the company and CNBC is reporting that it hired JP Morgan to find a buyer. GoPro said it expects sales for the quarter that ended December 31 to be $340 million, a 37 percent decline from the same period a year ago. The premium model now goes for $399, down from $499.

Morgan Stanley said in a research note earlier Monday that the price cut for the Hero6 camera would make earnings growth hard in fiscal 2018.

Wintry Mix Possible Sunday
Cloudy skies, light-to-moderate breezes, and steady temperatures in the low 20s are projected for Sunday night . The National Weather Service has issued a Winter Weather Advisory for St.

In November, Raymond James analyst Tavis McCourt wrote that there hasn't been a noticeable bump from GoPro's newest camera in the Hero line, and it's turning up less in searches and app downloads.

And although GoPro's Karma drone was the number two offering in its price division, the company will exit the "extremely competitive" drone market, it said. At the time of writing GoPro's market cap is a hair about $1 billion and its stock price jumped on news the company is looking to sell.

The company is cutting more than 250 staff from its workforce, which numbered more than 1,250 at the end of September. This will cut costs, but it's also an indication that GoPro's growth story is dead. Later in the day, GoPro CEO Nick Woodman told Bloomberg the company would be open to sale, but isn't actively shopping itself. This is the fourth time the company has taken such action since 2016.

Other reports by

Discuss This Article

FOLLOW OUR NEWSPAPER