GoPro Drops to All-Time Low Following Inaccurate Report
GoPro (GPRO) CEO Nick Woodward said his company is open to “uniting with a bigger parent company” that can help it scale in size, but that it is not actively shopping itself. Woodward’s comments came after reports earlier in the day (Mon.) indicated the action camera company had engaged JPMorgan to actively explore its sale. Following release of the initial story, shares dropped to an all-time low $5.04; before rebounding to finish the day down 12.77% ($6.56). Woodward did acknowledge JPMorgan was the company banker.
Howie Long-Short: It’s been a busy week for GPRO; the company also dropped 4th quarter revenue projections by $130 million (from $470 million to $340 million), announced the layoffs of 200-300 employees as part of a corporate restructuring and its plans to close the Karma drone division. Weak demand during the holiday season and a $100 drop in the cost of the Hero6 are to blame for the lower revenue figures; while the company is winding down its drone division, citing an “extremely competitive market” and foreseeing a stringent regulatory environment that will stunt drone sales in the coming years.
Fan Marino: Shareholders disappointed in the company’s performance since reaching a high of $98.47 in Aug. ’14, will at least be pleased to hear that Woodward isn’t cashing in at their expense; he announced he’ll be reducing his salary to $1.
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