An Overview Of GoPro’s 2017 Performance

GoPro Inc. entered 2017 in fairly rough shape, as its revenues were facing pressure and its newly launched Karma drone was recalled less than a month after its launch due to technical issues. However, thanks to the strong performances of its HERO 5 and newly launched HERO 6 devices, coupled with the relaunch of the Karma drone, the company’s revenues for the first nine months of 2017 improved nearly 31% compared to the same period in 2016. Below is a quick recap of GoPro’s 2017 performance so far.

Revenue Recovery Puts GoPro Back On Track

GoPro had a decent first three quarters of 2017, with revenue of over $844 million in the first three quarters, an increase of nearly 31% year-on-year, primarily driven by the strong performances of HERO 5, HERO 6, and the relaunched Karma drone, which was ranked the 2nd best selling drone brand in the U.S. GoPro showed signs of improvement when it reported its third quarter results in November. The company’s top line grew faster than expected to $330 million, beating estimates by nearly $17 million, representing a jump of 37% on a year-on-year basis.

This growth was driven by increased average selling prices (ASP) as well as units shipped during the quarter. While ASPs grew by 22% year-on-year, driven primarily by the premium-priced HERO 6, units shipped increased by 12% year-on-year, highlighting the strong demand for the newly launched camera. The company’s gross margins rallied to slightly over 40%, up from 31% in Q1’17. Further, its earnings turned positive in the quarter and beat consensus estimates. However, the optimism around the company’s recovery was dampened somewhat by management’s guidance for Q4, with sales expected to be 11-15% lower on a y-o-y basis.