Release Date: November 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- GoPro Inc (GPRO, Financial) exceeded guidance with Q3 revenue of $259 million.
- Subscription and service revenue grew 11% year over year to $27.5 million.
- The company launched two new products, including the flagship HERO13 Black and a new entry-level camera priced at $199.
- GoPro Inc (GPRO) expanded its global retail footprint, adding over 1,200 new doors in Q3, including 500 Sam's Clubs in the US.
- The company is targeting a significant reduction in 2025 operating expenses to $250 million, a $110 million decrease from 2024.
Negative Points
- GoPro Inc (GPRO) is facing global macroeconomic headwinds impacting consumer discretionary spending.
- There is a delay in the launch of the new 360-degree camera, affecting revenue and market share.
- The company is involved in litigation to protect its intellectual property, which could be costly and time-consuming.
- Despite the increase in retail doors, the full benefit is not being realized due to incomplete product offerings.
- GoPro Inc (GPRO) anticipates lower units and revenue in 2025 due to macroeconomic challenges and competition.
Q & A Highlights
Q: What is the ideal outcome of the USITC investigation regarding the litigation?
A: Nicholas Woodman, CEO, stated that the ideal outcome would be for the ITC to recognize the infringement, validate GoPro's patents, and prevent the infringing company from selling those products in the U.S. market.
Q: Is there a timeline for the conclusion of the USITC investigation?
A: Nicholas Woodman, CEO, mentioned that they expect a conclusion in 2025.
Q: What are the most impactful headwinds for the 2025 outlook?
A: Brian McGee, CFO, identified macroeconomic conditions as the most significant headwind, followed by the need to launch the new 360 camera and competition. He noted that the macroeconomic impact is particularly strong in the U.S. and China.
Q: How does GoPro reconcile the increase in retail doors with the reduced 2025 outlook?
A: Nicholas Woodman, CEO, explained that while the expansion to over 25,000 retail doors is beneficial, the full potential is not realized due to the delay in launching the new 360 camera. They expect to leverage this retail network more effectively in 2025 with new product launches.
Q: Where is the most competition-driven share erosion occurring?
A: Brian McGee, CFO, noted that the biggest share erosion is in the 360-degree camera category due to the delayed launch of their new camera. There is also some erosion in the action camera category, but the most significant revenue impact is from not launching the MAX 2 360 camera.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
