GoPro Q3 Earnings and Revenues Surpass Estimates

GoPro, Inc GPRO reported non-GAAP breakeven earnings per share for the third quarter of 2024 in contrast to the Zacks Consensus Estimate of a loss of 4 cents per share. The company reported earnings per share of 6 cents in the year-ago quarter. Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.GPRO generated revenues of $259 million, down 12% year over year due to lower camera unit sales. The metric was within the company’s guidance of $255 million (+/- $5 million). The top line beat the consensus mark by 1.6%.GoPro shipped 881,000 camera units in the reported quarter, down 5% year over year.GPRO’s Quarter in DetailsBased on channels, revenues from GoPro.com of $51 million (19.7%) plunged 19% year over year. Our estimate was pegged at $52.8 million.In this channel, hardware revenues totaled $23.5 million compared with $38.5 million in the prior-year quarter. Subscription revenues amounted to $27.5 million, up 11% year over year. This uptick was driven by improving retention rates and growth of Premium+ subscribers which led to a 9% increase in average revenue per user.  Retail channel registered revenues of $207.9 million (80.3%), which fell 10% year over year. We estimated the metric to be $202.1 million.GPRO added 1,200 new retail doors across all regions in the quarter under review. Management noted that GoPro added more than 6,300 new retail doors since the second quarter of 2023. GoPro, Inc. Price, Consensus and EPS Surprise GoPro, Inc. price-consensus-eps-surprise-chart | GoPro, Inc. QuoteGPRO recorded 2.56 million subscribers (including 54,000 Premium+ subscribers), marking 2% year-over-year growth at the end of the quarter under discussion. Management envisions subscribers at 2024-end to be up 2% to 2.55 million.Region-wise, revenues from the Americas totaled $109.3 million (42.2% of total revenues), down 17% from the prior-year levels. Revenues from Europe, the Middle East and Africa of $84.4 million (32.6%) were up 1% year over year. Asia Pacific region generated revenues of $65.2 million (25.2%), down 18% on a year-over-year basis. The company had $155.3 million in inventory compared with $97.3 million in the previous quarter.GPRO’s Margin PerformanceNon-GAAP gross margin was 35.6% compared with 32.2% in the year-ago quarter. This increase in gross margin was driven by a cost reduction of more than 30% to the entry-level price point camera, improvements in the subscription model and lower expenses related to warranty and tariffs. Non-GAAP operating expenses of $91.2 million rose 3% year over year. Non-GAAP operating income totaled $0.95 million compared with $5.8 million in the prior-year quarter.Adjusted EBITDA was $5.45 million compared with $7.23 million a year ago.Cameras with suggested retail prices at or above $400 contributed 74% to revenues in the reported quarter compared with 75% in the prior-year quarter. Street ASP stood at $294 below the company’s guidance of $300 and $319 reported in the prior year quarter.GPRO’s Cash Flow & LiquidityIn the quarter under review, GoPro used $2.2 million of net cash from operating activities compared with $1.6 million of cash used in the year-earlier quarter.As of Sept. 30, the company had $130.2 million of cash and cash equivalents with $93.1 million of long-term debt.GuidanceFor the fourth quarter of 2024, revenues are estimated to be $200 million (+/- $10 million). Non-GAAP adjusted loss is forecasted to be 11 cents per share (+/- 2 cents).Gross margin is anticipated to be 36.5% (+/- 50 basis points). Gross margin performance is expected to be driven by new product sales, increasing subscription and service revenues and improving product costs, partly offset by higher promotional activity.  Street ASP is projected to be nearly $330, unchanged year over year.GPRO continues to expect the launch of a new entry-level camera in 2025. The delay in launch will have a negative impact on revenues in the fourth quarter of 2024. Revenues for 2024 are anticipated to be $800 million (+/- $10 million) compared with the earlier projection of $850-$870 million. GPRO now expects units to be 2.45 million compared with 2.6-2.7 million projected earlier. It forecasts 2024 operating expenses to be approximately $360 million (+/- $2 million) and an operating loss of $84 million (+/- $3 million).Apart from the delays, muted consumer spending in the absence of promotional activity, global macroeconomic concerns, forex volatility (China and Japan) and increasing competition remain headwinds. Further, the company anticipates units and revenue growth in 2025 to be lower than that of in 2024, primarily driven by macroeconomic headwinds, competition and the delayed launch of its new 360-degree camera. However, operating expenses in 2025 are expected to be $250 million (+/- $5 million), due to a 26% reduction in headcount and other expenses undertaken in 2024. This is likely to boost profitability.GPRO’s Zacks RankGoPro currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Performance of Other Companies in Broader Tech SpaceSeagate Technology Holdings plc STX reported first-quarter fiscal 2025 non-GAAP earnings of $1.58 per share, beating the Zacks Consensus Estimate by 6.8%. The company reported a non-GAAP loss of 22 cents per share in the year-ago quarter. This improvement in the bottom line was driven by a favorable mix shift to mass-capacity products and a better pricing environment. Non-GAAP revenues of $2.168 billion beat the Zacks Consensus Estimate by 2.4%. The figure increased 49% on a year-over-year basis and 15% sequentially. Shares of STX have gained 46% in the past year.Badger Meter, Inc BMI reported EPS of $1.08 for the third quarter of 2024, beating the Zacks Consensus Estimate by 5.9%. Quarterly net sales were $208.4 million, up 12% from $186.2 million in the year-ago quarter. This uptick resulted from continued strong yet normalizing demand for its tailorable water management solutions. Shares of BMI have gained 57.6% in the past year. Iridium Communications IRDM reported EPS of 21 cents for the third quarter of 2024, beating the Zacks Consensus Estimate by 5%. The company incurred a loss of a cent per share in the prior-year quarter. Quarterly revenues were $212.8 million, up 8% from the year-ago level, driven by strength across all three segments. The Zacks Consensus Estimate was pegged at $205.7 million. Shares of IRDM have lost 21.3% in the past year.Free: 5 Stocks to Buy As Infrastructure Spending SoarsTrillions of dollars in Federal funds have been earmarked to repair and upgrade America’s infrastructure. In addition to roads and bridges, this flood of cash will pour into AI data centers, renewable energy sources and more.In, you’ll discover 5 surprising stocks positioned to profit the most from the spending spree that’s just getting started in this space.Download How to Profit from the Trillion-Dollar Infrastructure Boom absolutely free today.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Badger Meter, Inc. (BMI): Free Stock Analysis Report Seagate Technology Holdings PLC (STX): Free Stock Analysis Report GoPro, Inc. (GPRO): Free Stock Analysis Report Iridium Communications Inc (IRDM): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks