GoPro Bank On Hero 6 To Bounce Back
GoPro has announced it is on track to launch the newest edition of its flagship action cameras, the Hero 6, by the holiday season.
The company’s shares have declined nearly 50% since October last year, amid concerns it is falling behind camera-enhanced smartphones, and rival competitor offerings from Garmin and Sony.
GoPro also experienced production glitches with its Hero 5 camera, in addition to a delay in the launch of its Karma drone – both of which negatively impacted sales and pulled down the company’s stock.
Despite boasting a large following from ‘adrenaline-junkies’, namely surfers and skydivers, delays and issues as the aforementioned have caused sales numbers to take a beating in recent quarters.
Analysts state that a successful launch of the upcoming Hero 6 camera could help alleviate some of these concerns.
Just yesterday, GoPro announced that it expects to be profitable (on an adjusted basis) for the third quarter, ahead of the holiday season launch for its newest camera models – a move which sent its shares jumping 17%.
The announcement trumps the company’s initial forecast, which expected an adjusted loss in the third quarter. The company states the changing outlook is a result of strong demand for its cameras and drones, which has helped reduce its inventory.
GoPro forecasts third-quarter revenue and gross margins to be at the upper end of its projections, between $290 million – $310 million, and 36% – 38%.
On an adjusted basis, GoPro has previously expected a loss of 1 cent to 11 cents per share. Analysts expect a loss of 5 cents per share and a revenue of $304 million.
Chief Executive, Nick Woodman, stated last month that the company expects 2017’s revenue growth to be double digit, and to overall be profitable for the year.
Alicia Reese, Analyst at Wedbush Securities states of the announcement and the Hero 6’s forthcoming release:
“(GoPro‘s) execution is going well … specifically, the excitement is that the demand for existing GoPro products is strong and that bodes well for quite a Hero 6 sell run”.