Please ensure Javascript is enabled for purposes of website accessibility

Why GoPro, Inc. Stock Popped Today

By Steve Symington - Updated Mar 16, 2017 at 2:03PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The action camera maker jumped after an encouraging guidance update.

What happened

Shares of GoPro Inc. (GPRO -1.49%) were up 14.2% as of 12:00 p.m. EDT Thursday after the action camera and drone specialist announced first-quarter revenue will be at the high end of its previous outlook. GoPro also offered other encouraging updates on its business.

So what

More specifically, GoPro now expects first-quarter 2016 revenue to be at the high end of its previous $190 million to $210 million guidance range. In addition, it reaffirmed its full-year goal of reclaiming profitability on a non-GAAP basis. And thanks to the restructuring it originally announced this past November -- which notably included eliminating 270 current and open positions and the closing of its media segment -- GoPro now anticipates full-year GAAP operating expenses to fall below $585 million (down from $834.9 million in 2016), while non-GAAP operating expenses should fall below $495 million (down from $708.8 million in 2016). Both figures represent significant improvements from GoPro's targets outlined early last month, which called for GAAP and non-GAAP 2017 operating expenses of $688 million and $600 million, respectively. 

GoPro's HERO5 Black camera

Image source: GoPro, Inc.

Now what

Perhaps most important, GoPro insisted it will achieve these expense reductions "without impacting the company's roadmap for new hardware and software products." GoPro CFO Brian McGee further noted the company currently has no need to draw on its credit facility, and should generate positive earnings before interest, taxes, depreciation, and amortization (EBITDA) for the full year of 2017.

"We're determined that GoPro's financial performance match the strength of our products and brand," added GoPro founder and CEO Nick Woodman.

All things considered, given its stronger-than-expected revenue performance for Q1, massive expense reductions for the coming year, and new products in the pipeline that could further fuel GoPro's performance in the coming quarters, it's no surprise to see shares rebounding today.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

GoPro, Inc. Stock Quote
GoPro, Inc.
$5.97 (-1.49%) $0.09

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 06/25/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.