Smartphone Cameras Cut Into GoPro Sales

Thursday posted a loss for the first quarter, as revenues almost halved and margins dropped sharply reflecting weak demand for its wearable cameras.

The San Mateo, Calif. -based camera company plans to expand its consumer base beyond those who now own their cameras by integrating the two apps into a single platform and letting users edit footage shot on their smartphone, the company said on its first-quarter earnings conference call. The company and investors now have placed bets on the launch of the Karma drone later this year, which they expect could boost its waning sales.

"Most of the revenue has been second half", Woodman said.

GoPro reported revenue of 183.5 million, down 49.5 percent from $363.1 million a year earlier.

The delay means GoPro's drone will be hitting the market around the same time as the Hero5, its next-generation activity-capture camera.

The stock is trading at $11.18 a share on Thursday, down about 2 percent.

GoPro said it shipped 701,000 cameras in the quarter, a 47.8 per cent drop from a year earlier. It also announced plans in January to lay off 7% of its staff as a cost cutting strategy.

The question now for drone fans is: Do you wait for the Karma or just go out and buy the excellent DJI Phantom 4? After opening at $11.39, its high was $11.55 and low was $11.25. GoPro's Studio was also installed almost 1.5 million times, bringing cumulative installs for the editing software to 16.5 million. Average daily volume is 7158270 and the short ratio is 3.63. As for the picture quality, that would really depend on whatever GoPro camera is attached to the drone.

Finally - and despite its top-line beat to start the year - GoPro reiterated its previous 2016 guidance for revenue in the range of $1.35 billion to $1.5 billion, or a 12% decline from 2015 at the midpoint.

In the end, this report may not have contained everything GoPro bulls had hoped to hear - less bad is, after all, still not good.

The analyst also noted that GoPro management made a strategic and execution error by not introducing a replacement for the HERO4 last holiday season.

Source: Smartphone Cameras Cut Into GoPro Sales