GoPro Inc. shares fell to their lowest ever after fourth-quarter earnings and a forecast for future revenue both were worse than analysts predicted.
The stock tumbled 8.7 percent to $9.78 at the close in New York, its lowest price since going public in June 2014. The shares have lost 90 percent after reaching a record $93.85 in October 2014.
Demand for GoPro’s Hero camera line popularized by extreme-sports enthusiasts showing off their exploits, is starting to shrink. The latest model, the Hero4 Session, was introduced long before the critical Christmas holiday and suffered two price cuts before sales finally took off. The company has faced complaints that its editing software isn’t user friendly and investors are worried about competition from the likes of Apple Inc. While GoPro generated excitement about its forthcoming drone, its launch date won’t be until later this year.
For the critical holiday shopping quarter, GoPro posted a loss of 8 cents a share, excluding certain costs, compared with a profit of 99 cents a share a year earlier. Analysts on average were projecting a profit of 1 cent, according to data compiled by Bloomberg. Revenue was $436.6 million, compared with the average estimate of $434.9 million after the company announced preliminary results Jan. 13, and said it would eliminate 7 percent of its workforce.
GoPro also announced that Chief Financial Officer Jack Lazar is stepping down. Brian McGee, who joined GoPro in 2015 from Qualcomm Inc., will succeed Lazar as CFO effective March 11, the company said.
GoPro’s sales took a hit after it had to twice lower the price on its latest model, the Hero4 Session. By the time GoPro dropped the cost to $200 in December from the $400 introductory price in July, excess inventory had already piled up, hurting margins in the fourth quarter. That impact appears to be lingering, and GoPro is forecasting first-quarter revenue of $160 million to $180 million, compared with analysts’ average estimate of $287.3 million.