GoPro Wipes Out After Giving Horrible Q1 Guidance; Q4 Misses
Action camera maker GoPro ( GPRO ) late Wednesday crashed like a downhill skier making a bad turn after missing earnings views for the fourth quarter and guiding to a shockingly weak first quarter. GoPro stock was down 13% to near 9 in after-hours trading following its earnings news release. GoPro stock rose 4.6% to 10.71 in the regular session on the stock market today . GoPro went public in June 2014 at 24 and climbed as high as 98.47 in October of that year. GoPro lost 8 cents a share in Q4 on a non-GAAP basis, where analysts were expecting it to break even. Under generally accepted accounting principles (GAAP), GoPro lost 25 cents a share, when Wall Street was looking for it to lose only 10 cents a share. On Jan. 13 , GoPro pre-announced lousy holiday sales for its Hero action cameras and accessories. At the time, GoPro said that it expected to report Q4 sales of $435 million, down 31% from the year-earlier quarter. Analysts had been projecting $512 million. GoPro’s actual sales in Q4 were $436.6 million. But analysts polled by Thomson Reuters had expected GoPro to post sales of $496.1 million, down 22%. For the March quarter, GoPro said that it expects sales of $160 million to $180 million, or $170 million at the midpoint. Analysts had been modeling $298 million. GoPro didn’t give an earnings-per-share outlook, but analysts had been expecting it to lose five cents a share. GoPro expects 2016 sales of $1.35 billion to $1.5 billion, or $1.425 billion at the midpoint. Analysts were modeling $1.61 billion, down 0.7%. When GoPro made its Q4 warning last month, it announced plans to cut 7% of its workforce, or about 100 employees. Late Wednesday, GoPro also announced that Brian McGee, a 30-year finance veteran who has served as chief financial officer of two publicly traded companies and who joined GoPro last year from Qualcomm ( QCOM ), will succeed CFO Jack Lazar, effective March 11. Lazar is retiring after two years at GoPro. The next catalysts for GoPro stock are the launch of its Karma drone and the release of a next-generation action camera, the Hero 5. The steep decline in GoPro’s share price had prompted speculation on Wall Street that the company might become an acquisition target. Ambarella ( AMBA ), which makes image processors for GoPro cameras, saw its shares down 2.5% in after-hours trading Wednesday.