GoPro (GPRO) Stock Halted after Weak Forecast, CFO Change

Shares of GoPro Inc. (GPRO) were trading down -1.41 or -13.17 percent to $9.30 per share in Thursday’s premarket after the company announced results for the fourth quarter and full fiscal 2015 year yesterday afternoon. The company’s stock was temporarily halted from trading after the company posted a surprise fourth quarter loss. GoPro stock closed at $10.71 per share, up +0.47 or +4.59 percent in Wednesday’s regular trading session.

Founded in 2004, San Mateo, California based GoPro Inc. was originally named Woodman Labs Inc. for its founder, Nick Woodman.
The company develops and manufactures lightweight wearable high definition personal cameras generally used in extreme action videos. The cameras can be used in unusual situations and are often mounted on drones, planes, quadracopters, cars and army tanks. The company’s product line includes three fixed lens cameras without viewfinders that are shockproof and waterproof to 180 feet or 60 meters, as well as accessories for wearing the camera while skiing, surfing or other sports. GoPro had its Initial Public Offering for $24 per share on June 25th, 2014.

GoPro reported a net loss of -$34.4 million for the fourth quarter or -$0.08 per share compared to a profit of $0.99 per share in the same period one year ago, a decline of -108 percent. Revenue for the quarter was $436.1 million versus $633.9 million in 2014, a -31 percent decline from 2014’s fourth quarter when the company reported a net profit of $144.9 million.

The analyst consensus was for the company to report earnings of $0.02 on $496.1 million in revenue. While missing analyst expectations, revenue was slightly better than the $435 million the company forecast in a January 13th warning.

GoPro Founder and Chief Executive Officer, Nicholas Woodman said in the company’s press release that, “In 2015, we recorded 16% year-over-year revenue growth and the fourth quarter represented the second highest revenue quarter in the company's history. However, growth slowed in the second half of the year and we recognize the need to develop software solutions that make it easier for our customers to offload, access and edit their GoPro content.”

GoPro issued its guidance to first quarter 2016 revenue, which is now $160 million to $180 million. Full year revenue was forecast to be $1.35 billion to $1.5 billion. The analyst consensus was for the company’s first quarter revenue to be $298 million with full year 2016 revenue of $1.61billion.

In addition to the lower than expected earnings and revenue, GoPro announced that its Chief Financial Officer, Jack Lazar is leaving the company and will be replaced by Brian McGee, effective on March 11th. McGee joined GoPro last year after working for Qualcomm’s Atheros Wi-Fi chip segment as Vice President of Business Operations.

GoPro shares immediately dropped -19 percent in Wednesday’s aftermarket after the earnings release, which led to trading in the stock being halted by the company for 25 minutes. Shares pared their losses after the stock resumed trading. The stock will open this morning at a new post IPO low, with a decline of more than -80 percent in the last twelve months and -61 percent lower than its initial offering price of $24 per share.

Other News About GPRO

GoPro spent $35 million buying $16 million worth of its own stock

Company bought back 1.5 million shares at about $23.05 per share in the fourth quarter.

GoPro Inc: A Broken Stock, Not A Broken Company

Wedbush analyst Michael Pachter still believes in the company.

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Published on Feb 4, 2016
By Jay Hawk
Jay Hawk
Jay Hawk enjoyed a 12-year professional financial markets career incorporating extensive first hand futures and options experience obtained by trading in the stock, commodity and forex markets on U.S. exchanges. Since retiring as a full-time financial market professional, he has been actively trading stock, commodities, forex and options for his own account and managing funds for others, as well as writing financial market commentary and educational articles.

Copyrighted 2020. Content published with author's permission.

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