GoPro, Inc. (GPRO - Free Report) reported fourth-quarter 2023 non-GAAP earnings of 2 cents per share, which missed the Zacks Consensus Estimate by 33.3%. The company reported earnings of 12 cents in the year-ago quarter.
GoPro generated revenues of $295.4 million, down 8% year over year. The top line also missed the consensus mark by 9.7%.
GPRO added that consumers were looking for discounts irrespective of already low prices in the holiday season. This led to lower-than-expected sell-through of its HERO10 Black product (priced at $249), which was not sold at a discount.
For 2023, revenues came in at $1 billion, down 8% year over year. Non-GAAP loss per share was 20 cents for the year. The company reported earnings of 47 cents in 2022.
Shares lost 14.1% in the pre-market trading on Feb 8. In the past year, shares of GPRO have declined 48.4% of their value against the sub-industry’s growth of 6%.
Quarter in Details
GoPro shipped 895 million camera units during the reported quarter, up 5.3% year over year.
It recorded 2.5 million subscribers, marking 12% year-over-year growth at the end of the quarter under discussion.
Management envisions subscribers at 2024-end to be between 2.5 million and 2.6 million.
Region-wise, revenues from the Americas totaled $126.9 million (43% of total revenues), down 17% from the prior-year levels. Revenues from Europe, the Middle East and Africa were $94.8 million (32.1%), improving 15% year over year. The Asia Pacific generated revenues of $73.7 million (24.9%), down 14% on a year-over-year basis.
Based on channels, revenues from GoPro.com of $67.4 million (22.8%) plunged 47% year over year. Our estimate was pegged at $82.6 million.
In this channel, hardware revenues totaled $42.3 million compared with $106 million in the previous-year quarter. Subscription revenues amounted to $25.1 million, climbing 13% year over year.
Retail channel registered revenues of $228 million (77%), which improved 18% year over year. The uptick was driven by strategic pricing action, increasing retail doors and retail efforts including merchandising. We suggested the metric to be $243.8 million.
Management noted that it added more than 3,200 new retail doors since May 2023, which was ahead of its target for the year by 17%. It intends to continue driving door growth with a target of 7,000 additional new doors over the next two years, powered by the launch of new products. GPRO is also planning to upgrade its point-of-purchase merchandisers, augment in-store brand presence and boost account management throughout the retail channel.
The company had $106.3 million in inventory compared with $127.1 million in the year-earlier quarter.
Other Details
Gross profit of $101.1 million decreased 3.1% year over year. Total operating expenses of $110.5 million rose 7.7% year over year. Operating loss totaled $9.4 million against operating income of $1.7 million in the prior-year quarter.
Non-GAAP gross margin came in at 34.4% compared with 35.1% in the year-ago quarter. Entry-level products accounted for 14% of camera revenues in the fourth quarter.
Adjusted EBITDA was $3.267 million compared with $22 million a year ago.
Cameras with suggested retail prices at or above $400 contributed 74% to revenues in the reported quarter compared with 90% in the prior-year quarter.
Cash Flow & Liquidity
In the quarter under review, GoPro generated $43.7 million of net cash from operating activities compared with $25.6 million in the year-ago period.
As of Dec 31, the company had $222.7 million of cash and cash equivalents with $92.6 million of long-term debt.
GPRO repurchased 2.8 million shares worth $10 million.
Guidance
For the first quarter of 2024, revenues are estimated to be $145 million (+/- $5 million). Non-GAAP adjusted loss is forecasted to be 25 cents per share (+/- 2 cents).
Gross margin is anticipated to be 32.5% (+/- 50 basis points). Street ASP is projected to be nearly $375.
GoPro currently has a Zacks Rank #4 (Sell).
Stocks to Consider
Some better-ranked stocks worth consideration in the broader technology space are Watts Water Technologies (WTS - Free Report) , Manhattan Associates (MANH - Free Report) and Microsoft (MSFT - Free Report) . While Manhattan Associates currently sports a Zacks Rank #1 (Strong Buy), Watts Water and Microsoft carry a Zacks Rank of 2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Watts Water Technologies’ 2023 EPS has improved 1.1% in the past 60 days to $8.09.
WTS’ earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 11.8%. Shares of WTS have gained 23% in the past year.
The Zacks Consensus Estimate for MANH 2024 EPS has increased 3.6% in the past 60 days to $3.76.
Manhattan Associates’ earnings beat the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 27.6%. Shares of MANH have surged 70.2% in the past year.
The Zacks Consensus Estimate for Microsoft’s fiscal 2024 earnings is pegged at $11.60 per share, indicating growth of 18.3% from the year-ago levels. Microsoft’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 8.8%. The long-term earnings growth rate is pegged at 16.2%. MSFT has gained 55.2% in the past year.
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GoPro, Inc. (GPRO - Free Report) reported fourth-quarter 2023 non-GAAP earnings of 2 cents per share, which missed the Zacks Consensus Estimate by 33.3%. The company reported earnings of 12 cents in the year-ago quarter.
GoPro generated revenues of $295.4 million, down 8% year over year. The top line also missed the consensus mark by 9.7%.
GPRO added that consumers were looking for discounts irrespective of already low prices in the holiday season. This led to lower-than-expected sell-through of its HERO10 Black product (priced at $249), which was not sold at a discount.
For 2023, revenues came in at $1 billion, down 8% year over year. Non-GAAP loss per share was 20 cents for the year. The company reported earnings of 47 cents in 2022.
Shares lost 14.1% in the pre-market trading on Feb 8. In the past year, shares of GPRO have declined 48.4% of their value against the sub-industry’s growth of 6%.
Quarter in Details
GoPro shipped 895 million camera units during the reported quarter, up 5.3% year over year.
It recorded 2.5 million subscribers, marking 12% year-over-year growth at the end of the quarter under discussion.
Management envisions subscribers at 2024-end to be between 2.5 million and 2.6 million.
Region-wise, revenues from the Americas totaled $126.9 million (43% of total revenues), down 17% from the prior-year levels. Revenues from Europe, the Middle East and Africa were $94.8 million (32.1%), improving 15% year over year. The Asia Pacific generated revenues of $73.7 million (24.9%), down 14% on a year-over-year basis.
Based on channels, revenues from GoPro.com of $67.4 million (22.8%) plunged 47% year over year. Our estimate was pegged at $82.6 million.
In this channel, hardware revenues totaled $42.3 million compared with $106 million in the previous-year quarter. Subscription revenues amounted to $25.1 million, climbing 13% year over year.
Retail channel registered revenues of $228 million (77%), which improved 18% year over year. The uptick was driven by strategic pricing action, increasing retail doors and retail efforts including merchandising. We suggested the metric to be $243.8 million.
Management noted that it added more than 3,200 new retail doors since May 2023, which was ahead of its target for the year by 17%. It intends to continue driving door growth with a target of 7,000 additional new doors over the next two years, powered by the launch of new products. GPRO is also planning to upgrade its point-of-purchase merchandisers, augment in-store brand presence and boost account management throughout the retail channel.
The company had $106.3 million in inventory compared with $127.1 million in the year-earlier quarter.
Other Details
Gross profit of $101.1 million decreased 3.1% year over year. Total operating expenses of $110.5 million rose 7.7% year over year. Operating loss totaled $9.4 million against operating income of $1.7 million in the prior-year quarter.
Non-GAAP gross margin came in at 34.4% compared with 35.1% in the year-ago quarter. Entry-level products accounted for 14% of camera revenues in the fourth quarter.
Adjusted EBITDA was $3.267 million compared with $22 million a year ago.
Cameras with suggested retail prices at or above $400 contributed 74% to revenues in the reported quarter compared with 90% in the prior-year quarter.
Cash Flow & Liquidity
In the quarter under review, GoPro generated $43.7 million of net cash from operating activities compared with $25.6 million in the year-ago period.
As of Dec 31, the company had $222.7 million of cash and cash equivalents with $92.6 million of long-term debt.
GPRO repurchased 2.8 million shares worth $10 million.
Guidance
For the first quarter of 2024, revenues are estimated to be $145 million (+/- $5 million). Non-GAAP adjusted loss is forecasted to be 25 cents per share (+/- 2 cents).
Gross margin is anticipated to be 32.5% (+/- 50 basis points). Street ASP is projected to be nearly $375.
GoPro currently has a Zacks Rank #4 (Sell).
Stocks to Consider
Some better-ranked stocks worth consideration in the broader technology space are Watts Water Technologies (WTS - Free Report) , Manhattan Associates (MANH - Free Report) and Microsoft (MSFT - Free Report) . While Manhattan Associates currently sports a Zacks Rank #1 (Strong Buy), Watts Water and Microsoft carry a Zacks Rank of 2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Watts Water Technologies’ 2023 EPS has improved 1.1% in the past 60 days to $8.09.
WTS’ earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 11.8%. Shares of WTS have gained 23% in the past year.
The Zacks Consensus Estimate for MANH 2024 EPS has increased 3.6% in the past 60 days to $3.76.
Manhattan Associates’ earnings beat the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 27.6%. Shares of MANH have surged 70.2% in the past year.
The Zacks Consensus Estimate for Microsoft’s fiscal 2024 earnings is pegged at $11.60 per share, indicating growth of 18.3% from the year-ago levels. Microsoft’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 8.8%. The long-term earnings growth rate is pegged at 16.2%. MSFT has gained 55.2% in the past year.
Zacks Names #1 Semiconductor Stock
It's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.
With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.
See This Stock Now for Free >>
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