GoPro Could Be Up For Sale

GoPro Could Be Up For Sale

Early today GoPro announced lay offs of up to 300 people and the company's exit from the drone business. Shares were down 19 percent in midday trading on Monday after it confirmed reports that about 20 percent of its workforce was leaving.

GoPro's fortunes have become so dire that it is even open to the idea of getting sold to another company.

First announced in December of 2015, action cam company GoPro has pulled the plug on its heavily delayed, disastrous aerial photography drone, best known for its spectacular propensity for falling out of the sky.

Additionally, GoPro said it is pulling the plug on its Karma drone business after more than a year of false starts, product stumbles and disappointing sales.

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After the market digested this news, GoPro's shares plunged to by nearly 30 per cent - to an all-time low of $US5.10 in early morning trade on Monday (New York time).

A source told AFP that GoPro hired JPMorgan Chase to advise it on strategic options, including a possible sale. The investment bank was one of the underwriters for GoPro's 2014 initial public offering.

Despite these latest failures, Woodman remains upbeat about GoPro's future.

The company's share price plummeted amid the disappointing reports. "We expect that going forward, our roadmap coupled with a lower operating expense model will enable GoPro to return to profitability and growth in the second half of 2018", said GoPro CEO Nick Woodman.

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Their fourth-quarter revenue is expected to hit $340 million which, while still impressive, is approximately a 37 percent decline from the same quarter in 2016.

GoPro's HERO5 camera line-up significantly underperformed during the holiday quarter, and the company ended up slashing $100 off the price to generate sales.

For now, the company seems to be working hard on its action cameras, and we can expect to see some more price cuts on the Hero series.

GoPro (NASDAQ:GPRO)'s stock had its "sell" rating reiterated by analysts at Dougherty & Co in a research report issued to clients and investors on Tuesday, reports.

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Woodman, 42, rocketed to the top of the Bloomberg Pay Index, a ranking of the highest-paid U.S. executives, as GoPro shares soared after its initial public offering, boosting the value of his 2014 equity grant.

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