Breaking Down GoPro, Inc. (GPRO) Financial Health: Key Insights for Investors

As an investor, are you keeping a close watch on GoPro, Inc. (GPRO) and trying to decipher its financial performance? Did you know that in 2024, the company faced a 20% year-over-year decrease in revenue, landing at $801 million, and a GAAP net loss of $432 million, or $(2.82) per share? But it's not all bad news. With subscription and service revenue up by 10% to $107 million, and a plan to slash operating expenses by nearly 30% in 2025, is GoPro gearing up for a turnaround? Let's dive into the key financial insights that could shape your investment decisions.

GoPro, Inc. (GPRO) Revenue Analysis

A deep dive into GoPro, Inc.'s (GPRO) financial health requires a comprehensive understanding of its revenue streams. The following analysis breaks down the company's primary sources of income, revenue growth trends, and the contribution of various business segments to overall revenue.

Primary Revenue Sources:

GoPro's revenue is primarily derived from:

• Product Sales: This includes the sale of cameras like the HERO series, action camera accessories, and lifestyle gear.
• Subscription and Service Revenue: This encompasses GoPro's cloud storage subscriptions, software, and other services.

Year-over-Year Revenue Growth Rate:

Analyzing GoPro's historical revenue trends provides insights into its growth trajectory. While specific 2024 figures would offer the most current view, examining past performance reveals patterns. For instance, fluctuations in year-over-year revenue growth often correlate with new product launches, marketing campaigns, and overall market demand for action cameras.

Consider this hypothetical data for illustrative purposes:

Investors should seek the actual 2024 revenue figures and growth rate when available to assess GoPro's current financial performance.

Contribution of Business Segments:

To understand the composition of GoPro's revenue, it's essential to analyze the contribution of different business segments. Typically, this involves breaking down revenue by product sales and subscription/service revenue.

For example:

• Product Sales: Historically, the sale of cameras and accessories has been the dominant revenue stream. The success of new camera models significantly impacts this segment.
• Subscription and Services: GoPro's subscription services, such as cloud storage and premium features, are increasingly important. Growth in this segment provides recurring revenue and can improve overall profitability.

Analysis of Significant Changes in Revenue Streams:

Monitoring shifts in GoPro's revenue streams is crucial for investors. Key factors to consider include:

• New Product Launches: Successful new camera models can drive significant revenue increases.
• Subscription Growth: The ability to attract and retain subscribers to GoPro's cloud and service offerings is vital for long-term revenue stability.
• Market Trends: Changes in the action camera market, such as increased competition or shifting consumer preferences, can impact revenue.
• Geographic Expansion: Expansion into new markets can open up additional revenue opportunities.

Investors should closely watch these factors to assess GoPro's ability to adapt to changing market conditions and maintain a healthy revenue stream.

For more insights into GoPro's investor profile, check out: Exploring GoPro, Inc. (GPRO) Investor Profile: Who’s Buying and Why?

GoPro, Inc. (GPRO) Profitability Metrics

Assessing GoPro, Inc.'s (GPRO) financial health requires a detailed look into its profitability metrics. Profitability measures how well a company uses its assets to generate earnings relative to its revenue and invested capital. Here's an analysis of GoPro's gross profit, operating profit, and net profit margins, along with trends and comparisons.

For a deeper dive, check out: Breaking Down GoPro, Inc. (GPRO) Financial Health: Key Insights for Investors

Gross Profit Margin

GoPro's gross profit margin is a key indicator of its production efficiency and pricing strategy. It represents the percentage of revenue remaining after deducting the cost of goods sold (COGS). Analyzing the 2024 data, we can observe the following:

• Full year 2024 gross margin was 34.1%, compared to 32.4% in the prior year.
• The annual improvement in gross margin was primarily due to an increase in high-margin subscription and service revenue and improvement in operating cost efficiencies, partially offset by an increase in promotional activity.
• The gross margin of 35.1% in the fourth quarter of 2024 was impacted by a stronger U.S. dollar by 80 bps. Without this impact, the gross margin would have been 35.9%.

Operating Profit Margin

The operating profit margin reflects a company's earnings before interest and taxes (EBIT) as a percentage of its revenue. It indicates how well a company manages its operational expenses. Recent data shows:

• GoPro's operating margin at the end of 2024 was -16.19%.
• The operating Margin for GoPro as of April 2025 (TTM): -16.60%.

GoPro’s operating margin % for the fiscal year that ended in Dec. 2024 is calculated as:

Operating Margin %, = Operating Income (A: Dec. 2024 ), /, Revenue (A: Dec. 2024 ) = -127.172, /, 801.473 = -15.87 %.

Net Profit Margin

The net profit margin is the percentage of revenue that remains after all expenses, including taxes and interest, are deducted. It is a comprehensive measure of a company's overall profitability. For 2024:

• GAAP net loss was $432 million, or a $(2.82) loss per share.
• Non-GAAP net loss was $370 million, or a $(2.42) loss per share.
• GAAP and non-GAAP net loss per share for 2024 were impacted by the establishment of a $295 million valuation allowance on U.S. deferred tax assets.

Trends in Profitability Over Time

To understand GoPro's profitability trends, it's useful to review historical data. Here’s a look at the operating margin trends:

Operational Efficiency

GoPro's operational efficiency can be further understood through its cost management strategies and gross margin trends:

• Cost Management: GoPro is actively managing costs through restructuring plans, which include a 25% reduction in its global workforce.
• Gross Margin Trends: The company's gross margin has improved due to cost reductions, enhanced operational efficiencies, and supply chain diversification outside of China.

GoPro, Inc. (GPRO) Debt vs. Equity Structure

Understanding how GoPro, Inc. (GPRO) finances its operations and growth is crucial for investors. This involves analyzing the company's debt levels, its debt-to-equity ratio, and how it strategically uses debt versus equity.

As of the fiscal year 2024, GoPro's financial structure includes a mix of debt and equity. Examining their annual reports and financial statements provides a detailed breakdown:

• Long-term Debt: Reviewing GoPro's long-term debt helps understand their obligations extending beyond the current year.
• Short-term Debt: Analyzing short-term debt indicates immediate liabilities and liquidity management.

The debt-to-equity ratio is a key metric for assessing GoPro's financial leverage. It indicates the proportion of debt and equity the company uses to finance its assets. A high ratio suggests greater financial risk, while a lower ratio indicates a more conservative approach.

Industry standards for debt-to-equity ratios vary, but comparing GoPro to its peers in the electronics and imaging technology sectors provides valuable context. This benchmark helps investors gauge whether GoPro's leverage is within a reasonable range or if it deviates significantly, potentially signaling higher risk or a more aggressive growth strategy.

Recent activities, such as debt issuances, credit ratings, or refinancing, can significantly impact GoPro's financial health. Monitoring these events offers insights into how GoPro manages its capital structure and responds to market conditions.

Balancing debt and equity is a strategic decision. Debt financing can provide capital for growth initiatives without diluting ownership, but it also introduces fixed interest payments and the risk of default. Equity funding, on the other hand, does not require repayment but dilutes existing shareholders' ownership.

Here's an overview of factors influencing GoPro's financing decisions:

• Market Conditions: Interest rates and investor sentiment affect the cost and availability of debt and equity financing.
• Growth Opportunities: Ambitious expansion plans may require more capital, influencing the choice between debt and equity.
• Financial Performance: Strong profitability and cash flow can support higher debt levels, while weaker performance may necessitate equity funding.

Understanding GoPro's approach to balancing debt and equity is essential for assessing its financial stability and growth potential. Investors should consider these factors in light of the company's strategic goals and the broader economic environment.

A closer look at GoPro's financials will likely reveal more details:

The table illustrates a projected improvement in GoPro's debt-to-equity ratio, showcasing a move towards a more balanced capital structure.

To gain more insight into GoPro's strategic direction, you might find this resource helpful: Mission Statement, Vision, & Core Values of GoPro, Inc. (GPRO).

GoPro, Inc. (GPRO) Liquidity and Solvency

Liquidity and solvency are vital indicators of a company's financial health, revealing its ability to meet short-term obligations and sustain long-term operations. For GoPro, Inc. (GPRO), assessing these metrics provides insights into its operational efficiency and financial stability.

Current and Quick Ratios: These ratios are key in evaluating GoPro's short-term liquidity. The current ratio, calculated by dividing current assets by current liabilities, indicates whether GoPro has enough liquid assets to cover its short-term debts. The quick ratio, which excludes inventory from current assets, offers a more conservative view of immediate liquidity. For the fiscal year 2024, a closer look at these ratios will reveal GoPro's ability to handle its immediate financial obligations.

As of December 31, 2023, GoPro reported a current ratio of 1.43. This indicates that GoPro's current assets are 1.43 times its current liabilities. The quick ratio was 1.05, suggesting that even without relying on the sale of inventory, GoPro's liquid assets sufficiently cover its short-term liabilities.

Working Capital Trends: Analyzing working capital trends involves monitoring the difference between a company’s current assets and current liabilities over a period. An upward trend in working capital typically suggests improving liquidity, while a downward trend may indicate potential challenges in meeting short-term obligations. Monitoring GoPro’s working capital trend helps to understand its operational efficiency and liquidity management over time.

GoPro's working capital experienced fluctuations. It decreased from $188.74 million in 2021 to $146.24 million in 2022, and further to $134.38 million in 2023. The consistent downtrend in working capital may warrant a closer examination of GoPro's operational efficiency and liquidity management strategies.

Cash Flow Statements Overview: A thorough examination of GoPro's cash flow statements—covering operating, investing, and financing activities—provides a comprehensive view of its liquidity management. Positive cash flow from operations indicates that the company is generating sufficient cash from its core business activities. Trends in investing activities show how GoPro is deploying capital, while financing activities reflect how the company is funding its operations and managing its capital structure.

Here’s a snapshot of GoPro’s cash flow activities:

• Operating Activities: In 2023, GoPro generated $63.59 million in net cash from operating activities, a notable increase from $3.48 million in 2022.
• Investing Activities: GoPro used $13.49 million in investing activities in 2023, primarily for acquiring property and equipment. This contrasts with $6.47 million used in 2022.
• Financing Activities: GoPro used $43.86 million in financing activities in 2023, mainly for stock repurchases. This is a significant increase from the $23.37 million used in 2022.

Potential Liquidity Concerns or Strengths: Evaluating these elements helps identify potential liquidity concerns or strengths at GoPro. For example, strong cash flow from operations coupled with healthy current and quick ratios would indicate a solid liquidity position. Conversely, declining working capital and negative trends in operating cash flow may raise concerns about GoPro's ability to meet its short-term obligations.

Despite a decrease in working capital, GoPro's positive cash flow from operating activities and healthy liquidity ratios suggest financial stability. However, the consistent decline in working capital should be monitored.

For further insights into GoPro, Inc. (GPRO) financial health, you can explore: Breaking Down GoPro, Inc. (GPRO) Financial Health: Key Insights for Investors

GoPro, Inc. (GPRO) Valuation Analysis

Assessing whether GoPro, Inc. (GPRO) is overvalued or undervalued involves analyzing several key financial metrics and market indicators. These include price-to-earnings (P/E), price-to-book (P/B), and enterprise value-to-EBITDA (EV/EBITDA) ratios, stock price trends, dividend yield and payout ratios (if applicable), and analyst consensus.

As of April 2025, up-to-date data for these specific ratios reflecting the 2024 fiscal year performance is essential for an accurate valuation. Keep in mind that financial metrics can shift rapidly, so it’s best to refer to the most current financial news and analyst reports for the latest figures. Here's how these elements generally contribute to valuation analysis:

• Price-to-Earnings (P/E) Ratio: This ratio compares GoPro, Inc.'s stock price to its earnings per share (EPS). A higher P/E ratio might suggest that the stock is overvalued, indicating investors are paying more for each dollar of earnings. Conversely, a lower P/E ratio could indicate undervaluation.
• Price-to-Book (P/B) Ratio: The P/B ratio compares GoPro, Inc.'s market capitalization to its book value of equity. A lower P/B ratio may suggest undervaluation, implying that the stock is trading at a discount to its net asset value.
• Enterprise Value-to-EBITDA (EV/EBITDA) Ratio: This ratio compares GoPro, Inc.'s enterprise value (total market value plus debt, minus cash) to its earnings before interest, taxes, depreciation, and amortization (EBITDA). A lower EV/EBITDA ratio can indicate that the company is undervalued relative to its operating cash flow.

Analyzing the trend of GoPro, Inc.’s stock price over the last 12 months (or longer) provides insight into market sentiment and overall performance. Recent stock performance should be compared against industry peers and market benchmarks to provide context. Keep in mind that stock prices reflect market expectations and can be influenced by various factors, including company-specific news, industry trends, and broader economic conditions.

As of the latest available data, GoPro, Inc. does not offer a dividend. Therefore, dividend yield and payout ratios are not applicable to its valuation analysis.

The consensus among analysts can offer a summarized view of expert opinions on GoPro, Inc.’s valuation. These ratings typically range from 'buy' to 'sell,' reflecting analysts’ expectations for the stock’s future performance. It's important to consider the source and rationale behind these ratings, as they can be influenced by various factors and may not always be accurate.

For further insights into GoPro, Inc. (GPRO) and its investors, check out: Exploring GoPro, Inc. (GPRO) Investor Profile: Who’s Buying and Why?

GoPro, Inc. (GPRO) Risk Factors

Several internal and external risk factors can influence GoPro, Inc.'s (GPRO) financial health. These risks span industry competition, regulatory changes, market conditions, and specific operational and strategic challenges detailed in their financial reports.

Here's an overview of key risks:

• Intense Competition: The action camera and related accessories market is highly competitive. Competitors range from established electronics companies to smaller, specialized firms. This competition can lead to pricing pressures, reduced market share, and decreased profitability for GoPro.
• Technological Innovation: Rapid technological advancements in camera technology and alternative devices (like smartphones with advanced camera capabilities) could render GoPro's products obsolete or less appealing if the company fails to innovate and adapt quickly.
• Market Conditions and Consumer Discretionary Spending: GoPro's sales are heavily influenced by consumer spending on discretionary items. Economic downturns or shifts in consumer preferences could significantly reduce demand for its products.
• Supply Chain Disruptions: Disruptions in the global supply chain, whether due to geopolitical events, natural disasters, or other factors, can impact GoPro's ability to manufacture and distribute its products efficiently, leading to increased costs and potential revenue losses.
• Inventory Management: Effective inventory management is crucial. Overstocking can lead to obsolescence and price markdowns, while understocking can result in lost sales opportunities.
• Dependence on Key Retail Partners: GoPro relies on key retail partners to distribute its products. Changes in these relationships or the financial health of these partners could adversely affect GoPro's sales and distribution network.
• Intellectual Property Protection: Protecting its intellectual property is vital for maintaining a competitive edge. Infringement on GoPro's patents or trademarks could harm its brand and market position.
• Litigation and Regulatory Issues: GoPro could face legal challenges related to product liability, intellectual property, or other issues, which could result in significant expenses and reputational damage. Changes in regulations related to product safety, environmental standards, or data privacy could also impact its operations and financial performance.
• Foreign Exchange Risk: As a global company, GoPro is exposed to foreign exchange risk. Fluctuations in currency exchange rates can affect the profitability of international sales and the value of its assets and liabilities.

Mitigation strategies often involve diversifying product offerings, enhancing marketing efforts, and improving operational efficiencies. Monitoring these risks is crucial for investors to assess the company's resilience and long-term financial stability.

More insights on GoPro, Inc.'s (GPRO) financial health can be found at: Breaking Down GoPro, Inc. (GPRO) Financial Health: Key Insights for Investors

GoPro, Inc. (GPRO) Growth Opportunities

GoPro, Inc.'s future growth hinges on several factors, including product innovation, market expansion, strategic initiatives, and competitive advantages. Let's explore these areas in detail.

Key Growth Drivers:

• Product Innovations: GoPro's ability to consistently introduce new and improved products is crucial. This includes not only hardware like cameras but also software and services that enhance the user experience.
• Market Expansion: Expanding into new geographic markets and demographics can significantly boost revenue. This could involve targeting emerging markets or developing products tailored to specific user groups.
• Acquisitions: Strategic acquisitions of companies with complementary technologies or market access can accelerate growth and diversify GoPro's offerings.

Future Revenue Growth Projections and Earnings Estimates:

While exact figures are subject to market conditions and company performance, analysts' estimates provide a general outlook. Keep in mind that these are projections and not guarantees.

GoPro's financial performance in recent years provides a backdrop for these projections. For example, in the 2024 fiscal year, GoPro reported revenue of $1.035 billion. The company's direct-to-consumer (DTC) channel has also shown significant growth, accounting for $459 million, or approximately 44% of the total revenue in 2024.

Strategic Initiatives and Partnerships:

• Subscription Services: GoPro's subscription model, which includes cloud storage, enhanced warranty, and discounts, has been a key driver of recurring revenue. Expanding and improving these services can lead to continued growth. In 2024, GoPro's subscriber count increased to 2.72 million, generating $178 million in annual recurring revenue (ARR).
• Partnerships: Collaborating with other companies, particularly in the media and technology sectors, can create new opportunities for content distribution and product integration.

Competitive Advantages:

• Brand Recognition: GoPro has a strong brand reputation and is synonymous with action cameras. Maintaining and leveraging this brand equity is essential.
• Ecosystem: GoPro's ecosystem of cameras, software, and accessories creates a sticky user base. Expanding this ecosystem with new products and services can enhance customer loyalty.
• Direct-to-Consumer (DTC) Model: The shift towards a DTC model allows GoPro to have greater control over its sales and customer relationships, leading to higher margins and better customer insights. In 2024, the DTC channel accounted for a significant portion of the company's revenue, highlighting its importance.

Here’s a look at GoPro's financial highlights based on recent reports:

For additional insights into GoPro's mission, vision, and core values, you can explore: Mission Statement, Vision, & Core Values of GoPro, Inc. (GPRO).