GoPro (GPRO 14.39%) said first-quarter revenue fell less than it expected as the action camera maker reported a deep loss for writing down the value of tax-deferred assets.
Revenue declined 11% to $155.5 million from $174.7 million in the year-ago quarter. The company in a statement yesterday said it had anticipated revenue of about $145 million. The company also reported a net loss of $339 million, or earnings per share (EPS) of $2.24, compared with a net loss of $30 million, or $0.19, in the prior year. The company attributed the loss to a $295 million charge off of tax-deferred assets that it no longer expects it can use.
One positive sign was the 12% increase in subscription revenue to $26 million, an area GoPro is counting on for growth.
| Metric | 2024 Q1 | 2023 Q1 | % Change |
|---|---|---|---|
| Revenue | $155.5 million | $174.7 million | -11% |
| GAAP net loss | $(339) million | $(30) million | 1,030.3% |
| Subscription revenue | $26 million | $23.2 million | +12% |
| Subscriber count | 2.5 million | 2.35 million | +6% |
Data sources: Company results from company. Analyst estimates from FactSet.
Understanding GoPro's business
GoPro once was a stock market sweetheart, and the shares traded as high as $95 in 2015 as its action cameras appealed to athletes, adventurers and influencers. The shares now check in at about $1.70 as camera sales have declined. To offset that decline, the company has tried to turn buyers into long-term subscribers to its cloud editing and storage services.
NASDAQ: GPRO
Key Data Points
Quarterly highlights
GoPro's shipments of cameras declined 15% to 363,000 from 462,00 in the same quarter last year. This indicates challenges in GoPro's direct-to-consumer retail strategy.
GoPro's subscription services continued to grow, with the total subscriber count rising to 2.5 million, a 6% year-over-year gain. This aligns with GoPro's aim to forge a steadier revenue stream amid the unpredictability of camera and hardware sales.
Looking forward
GoPro management plans to continue focusing on areas including the subscription model and expanding the total addressable market (TAM) through innovative offerings. Its overarching goal is to offer products that go beyond the capabilities of mobile phones, which increasingly have camera features that compete with GoPro.
GoPro investors should monitor the company's ability to bounce back from slumping camera sales slump and expand its subscription base while sustaining hardware upgrades and innovations.
