What happened 

Shares of action-camera maker GoPro Inc (NASDAQ:GPRO) jumped as much as 11.7% in trading Friday after the company reported first-quarter results that topped expectations. Shares gained momentum throughout the day and were trading 11.5% higher at 3:05 p.m. EDT. 

So what

Revenue was down 7.4% in the first quarter versus a year ago to $202.3 million, beating the $184.2 million estimate from Wall Street, and net loss improved from $111.2 million to $76.3 million, or $0.55 per share. On a non-GAAP basis, the loss was $0.34 per share, which topped the $0.37 loss that analysts expected. 

GoPro Hero 6 camera.

Image source: GoPro.

GoPro has tried to simplify its product line by dropping its drone and the Session line of cameras, going instead with a simple "good, better, best" product lineup, each of which has the same form factor. The strategy is paying off with lower operating costs and inventory, which has helped the bottom line even as revenue has fallen. 

Now what

The fact that GoPro beat expectations at all was enough to send shares shooting higher, but they were trading near an all-time low, so I wouldn't read too much into the market's reaction. GoPro is certainly selling more cameras than expected with volume up 3% versus a year ago, but the average sale price is down to $267 from $296 a year ago, and will likely fall further as the volume of $199 Hero cameras ramps up. Beating analyst estimates is great, but I'd like to see GoPro prove it can be profitable throughout a year before getting too excited about this stock, which is what will keep me out of the stock today. 

Travis Hoium has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends GoPro. The Motley Fool has a disclosure policy.