GoPro Inc. (NASDAQ:GPRO) released its earnings after the closing bell on Wednesday, February 3rd, 2016. The results were a disappointment to analysts who hoped GoPro could keep its earnings neutral. Here’s a quick summary.
GoPro reported annual GAAP earnings of $0.25 per share on revenue of $1.39 billion. However, the company lost $34.45 million in the final quarter of 2015, or $0.25 per share on $436.6 million in sales.
Analysts were expecting sales to drop 21.7% from a year before, from $633.91 to $496.10. (Source: “What to Expect From GoPro Earnings”, 24/7 Wall Street, February 3rd, 2016)
More importantly, GoPro needed to bolster some faith in its crumbling stock price. A statement issued last month hinted at huge job losses in the near future. Specifically, the release spoke of a 7% cut in the workforce, bringing the headcount down to 1,395.
As a one-time expense, the restructuring should cost GoPro between $5 to $10 million. Here’s what the statement said.
“Over the past two years, GoPro’s headcount has grown by more than 50% annually, to more than 1,500 employees at the end of 2015. To better align resources to key growth initiatives, GoPro has implemented a reduction in its workforce of approximately 7%. The Company estimates it will incur approximately $5 million to $10 million of restructuring expenses in the first quarter of 2016, substantially all of which will be severance costs.”
After-hours trading on GoPro shares was halted before the earnings release.