Finally, GoPro should provide guidance for its current quarter. Revenues totaled $400.3 million, up 43% year on year, but missing the estimate for $433.6 million.
Advertisement
Now, what should interest investors more than these figures is fourth-quarter guidance. The Company offers HERO line of capture devices, including HERO3 camera HERO2, the HERO3+ camera along with the HERO4 and HERO. Particularly intriguing here will be whether the earlier-than-usual launch of GoPro’s latest devices (namely the HERO4 Silver and Black) is expected to negatively affect demand for the crucial holiday season.
The first footage from GoPro’s new drone can be seen below.
GoPro’s shares closed at $25.62 on Thursday. Finally, Dougherty & Company maintained the stock with “Buy” rating in an October 13 report. Most importantly, though, the company is iterating, not innovating, and this is causing the slowed growth.
GoPro went public in June 2014 at 24 and ended its first day of trading at 31.34. GoPro has been adamant on the fact that its higher-priced cameras are accountting for about half its revenue.
Management is finding it increasingly hard to expand the pipeline of products beyond hip action cameras, hike prices against the backdrop of increased competition, and grow mindshare without advertising. He rates GoPro stock as sector weight with a fair value of 22 to 30.
In a report dated October 29, Piper Jaffray Senior Research Analyst Erinn Murphy said she expects GoPro stock to continue falling and that she is especially cautious now following last night’s earnings call. Sales outside of the US reportedly made up more than 50% of the company’s revenue. The drone will be equipped with a physical stabilizing rig, and of course, a top-end GoPro camera. The new drone is anticipated to help pull the company back into the right track.
GoPro investors believe it is in the sweet spot, but the sweet spot, said on analysts is not enough all be itself. If the company wishes to survive and thrive, it will have to evolve past the durable camera game and expand more on its plans to become a media platform.
Advertisement
Looking at GoPro’s results on a geographical basis, the analyst noted that the strongest growth was in Europe, the Middle East and Africa where sales climbed 179% compared to previous year. The company has a series of ambitious efforts underway, including expanding into the rapidly-growing drone market, launching a new editing software platform and monetizing its awesome content of extreme sports activities.
