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GoPro (GPRO) Swings to Loss in Q1, Revenues Decline Y/Y

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GoPro, Inc (GPRO - Free Report) reported first-quarter 2023 non-GAAP loss of 18 cents per share, wider than the Zacks Consensus Estimate of a loss of 15 cents. The company had reported earnings of 9 cents in the year-ago quarter.

GoPro generated revenues of $174.7 million, down 19% from the year-ago quarter’s levels. However, the top line beat the consensus mark by 5.6%. GPRO’s pricing actions impacted performance of the top and bottom lines in the reported quarter.

Quarter in Details

GoPro shipped 462 million camera units during the reported quarter, down 11.7% year over year.

GPRO recorded 2.36 million subscribers, marking 36% year-over-year growth at the end of the reported quarter. Quik subscribers soared 12% to 289,000 from the prior-year quarter.

GoPro, Inc. Price, Consensus and EPS Surprise

GoPro, Inc. Price, Consensus and EPS Surprise

GoPro, Inc. price-consensus-eps-surprise-chart | GoPro, Inc. Quote


Region-wise, revenues from the Americas totaled $89.5 million (51.3% of total revenues), down 13% from the year-ago quarter’s levels. Revenues from Europe, the Middle East and Africa were $46 million (26.3%), down 25% year over year. The Asia Pacific generated revenues of $39.2 million (22.4%), down 25%.

Based on channels, revenues from GoPro.com were $94.9 million (54.3% of total revenues), up 7% year over year. In the GoPro.com channel, hardware revenues totaled $71.7 million compared with $70 million in the prior-year quarter. Subscription revenues amounted to $23.2 million, up 24.7% year over year.

Retail channel generated revenues of $79.8 million (45.7%), down 37.7% from the year-ago quarter’s levels.

The company had $154.8 million in inventory compared with $119.4 million in the year-ago quarter.

Other Details

Gross profit was $52.5 million, down 42% year over year. Total operating expenses were $92.3 million, up 12.2% year over year. Operating loss totaled $39.8 million against the operating income of $8.2 million in the prior-year quarter.

Non-GAAP gross margin was 30.3% compared with 42% in the year-ago quarter. Adjusted EBITDA loss was $27.5 million against the adjusted EBITDA income of $20.7 million in the year-ago quarter mainly due to the company’s new product pricing strategy that resulted in $24 million in price protection charges.

Cameras with suggested retail prices at or above $400 contributed 87% to revenues in the reported quarter compared with 92% in the prior-year quarter.

Cash Flow & Liquidity

In the quarter under review, GoPro used $67.1 million of net cash from operating activities compared with $73.4 million in the year-ago period.

As of Mar 31, the company had $157.8 million of cash and cash equivalents with $141.3 million of long-term debt.

GPRO repurchased $5 million worth of shares.

Guidance

For the second quarter of 2023, revenues are estimated to be $220 million (+/- $5 million).  Non-GAAP adjusted loss is expected to be 7 cents per share (+/- 2 cents).

Gross margins are anticipated to be 33.5% (+/- 50 basis points). Street ASP is projected to be nearly $360.

Zacks Rank & Stocks to Consider

GoPro currently has a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader technology space are Badger Meter (BMI - Free Report) , Watts Water Technologies (WTS - Free Report) and Blackbaud (BLKB - Free Report) . BMI and BLKB carry a Zacks Rank #1 (Strong Buy) whereas WTS currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Badger Meter’s 2023 earnings has increased 4.7% in the past 60 days to $2.69 per share. BMI’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 5.3%. Shares of BMI have surged 77.8% in the past year.

The Zacks Consensus Estimate for WTS’s 2023 earnings has increased 4.8% in the past 60 days to $7.16 per share. The long-term earnings growth rate is expected to be 8%.

WTS earnings beat the Zacks Consensus Estimate in the last four quarters, the average surprise being 16.3%. Shares of WTS have gained 29.1% in the past year.

The Zacks Consensus Estimate for Blackbaud’s 2023 earnings is pegged at $3.53 per share, up 2.9% in the past 60 days. The long-term earnings growth rate is anticipated to be 10.4%.

Blackbaud’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 10.4%. Shares of BLKB have increased 41.5% in the past year.

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