GoPro announces Fourth Quarter and Full Year 2017 Results

GaryPageau

Sell-Through Increases Following Pricing Initiatives

2017 Operating Expenses Down 34% YoY

$247 Million in Cash at Year End 2017 – Up $50 Million From Q3

Expands ‘Plus’ Subscription Benefits at Same $4.99 Monthly Price – 130,000 Subscribers and Growing

SAN MATEO, Calif., Feb. 1, 2018 /PRNewswire/ — GoPro, Inc. (NASDAQ: GPRO) announced financial results for its fourth quarter and full year ended December 31, 2017. The Company recorded full year 2017 revenue of $1.18 billion, flat year-over-year. Operating expenses decreased by more than 30% year-over-year. The Company ended the year with $247 million in cash and marketable securities – up $50 million from the third quarter.

“The fourth quarter demonstrated there is significant demand for GoPro products at the right price,” said GoPro founder and CEO Nicholas Woodman. “Our opportunity in 2018 is to marry consumer demand for GoPro with new, higher margin cameras launching in the second half that will appeal to existing and new consumers. We are also focused on growing GoPro’ssubscription service, Plus, and launching new initiatives as subscription becomes an increasingly important focus for our business.”

Recent GoPro Highlights:

  • GoPro reduced GAAP operating expenses to $548 million in 2017, down 34% year-over-year. Non-GAAP operating expenses were down 33% year-over-year to $476 million. In 2018, GoPro is targeting non-GAAP operating expenses below $400 million– a cumulative reduction of more than $300 million since 2016.
  • GoPro strengthened its balance sheet, generating $81 million in cash since March 31st, excluding the net proceeds from its convertible debt offering in April, ending the year with $247 million in cash and marketable securities.
  • GAAP net loss for the year was approximately $183 million, or $1.32 per share, compared to a net loss of $419 million in 2016, or $3.01 per share. GAAP net loss for the fourth quarter 2017 was $56 million. Non-GAAP net loss for the year, and for the fourth quarter of 2017, was $96 million and $41 million, respectively.
  • For the fourth straight year, GoPro’s portfolio captured more than 80% of the Action Camera category by unit volume in the U.S. in 2017, according to The NPD Group’s Retail Tracking Service.
  • In Europe, GoPro held 69% and 44% of the Action Camera category by dollar and unit volume, respectively, in 2017, according to GfK.
  • In China, unit sales grew by 28% year-over-year in 2017, marking 2 years of consecutive sell-through growth, according to GfK.
  • In Japan, unit sales grew by 96% year-over-year in 2017, marking 2 years of consecutive growth with sell-through doubling each year since 2015, according to GfK.
  • GoPro’s 360-degree camera, Fusion, launched at over 1,000 Best Buy stores and B&H Photo, building on initial success at gopro.com.
  • Fusion earned a 2018 Edison Award in the Media, Visual Communications & Entertainment Category in February.
  • GoPro gained more than 4.8 million new social media followers in 2017, growing its total following to 35 million across all platforms, a 16% increase.
  • Instagram followers increased by 26% year-over-year in 2017, with the addition of 3 million followers, reaching a total of 15 million.
  • GoPro content was viewed ~700 million times on social media platforms in 2017, up more than 25% year-over-year. GoPro content on YouTube saw a 93% increase in median organic viewership per video in 2017.
  • The Quik Mobile Video Editing App was installed 38 million times since it launched in 2016. Quik App installs grew 120% year-over-year in 2017.
  • ‘Plus’ subscription service has 130,000 paying subscribers worldwide. In January 2018, GoPro expanded subscription benefits for Plus subscribers, including replacement for damaged cameras, mobile cloud backup, and greater storage capacity. This is the first of several subscription initiatives planned for Plus subscribers in 2018.

Results Summary

 

Three Months Ended December 31,

Year Ended December 31,

($ in thousands, except per share amounts)

2017

2016

% Change

2017

2016

% Change

Revenue

$

334,796

$

540,621

(38.1)

%

$

1,179,741

$

1,185,481

(0.5)

%

Gross margin

GAAP

23.8

%

39.2

%

(1,540) bps

32.6

%

39.0

%

(640) bps

Non-GAAP

24.8

%

39.5

%

(1,470) bps

33.3

%

39.3

%

(600) bps

Operating income (loss)

GAAP

$

(58,311)

$

(26,568)

(119.5)

%

$

(163,460)

$

(372,969)

56.2

%

Non-GAAP

$

(37,427)

$

31,639

(218.3)

%

$

(82,922)

$

(243,007)

65.9

%

Net income (loss)

GAAP

$

(55,848)

$

(115,709)

51.7

%

$

(182,873)

$

(419,003)

56.4

%

Non-GAAP

$

(41,319)

$

42,367

(197.5)

%

$

(95,867)

$

(201,247)

52.4

%

Diluted net income (loss) per share

GAAP

$

(0.41)

$

(0.82)

50.0

%

$

(1.32)

$

(3.01)

56.1

%

Non-GAAP

$

(0.30)

$

0.29

(203.4)

%

$

(0.69)

$

(1.44)

52.1

%

Adjusted EBITDA

$

(26,544)

$

44,343

(159.9)

%

$

(31,368)

$

(192,807)

83.7

%

Conference Call

GoPro management will host a conference call and live webcast for analysts and investors today at 2 p.m. Pacific Time (5 p.m. Eastern Time) to discuss the Company’s financial results.

To listen to the live conference call, please dial toll free (888) 271-8595 or (719) 325-2484, access code 2807712, approximately 5 minutes prior to the start of the call. A live webcast of the conference call will be accessible on the “Events & Presentations” section of the Company’s website at http://investor.gopro.com . A recording of the webcast will be available on GoPro’swebsite, http://investor.gopro.com, approximately two hours after the call and for 90 days thereafter.

About GoPro, Inc. (NASDAQ: GPRO)

GoPro makes it easy for people to celebrate and share experiences. We believe life is more meaningful when shared.  We build cameras, software and accessories that help the world share itself in immersive and exciting ways.

GoPro, HERO, Quik, QuikStories and their respective logos are trademarks or registered trademarks of GoPro, Inc. in the United States and other countries. All other trademarks are the property of their respective owners. For more information, visit www.gopro.com  or connect with GoPro on Facebook, Instagram, LinkedIn, Pinterest, Twitter, YouTube, and GoPro’s The Inside Line.