Af­ter lay­offs, GoPro’s busi­ness ap­pears to be back on track

The Star (St. Lucia) - - BUSINESS - By Sean O’Kane

GoPro an­nounced its sec­ond quar­ter earn­ings this week, and while it’s still los­ing money, things are fi­nally trending in a slightly bet­ter di­rec­tion for the cam­era com­pany. GoPro brought in $297 mil­lion in rev­enue this past quar­ter, a 34 per­cent in­crease over the sec­ond quar­ter of 2016 - which was one of the com­pany’s worst ever. It’s still not back to the highs it reached in 2014 and early 2015, but GoPro trimmed its losses to about $30 mil­lion, a third of what the com­pany lost in this same quar­ter last year.

How is GoPro turn­ing things around? There are two likely rea­sons. One is that the com­pany cleaved a sig­nif­i­cant amount of its work­force over the last year and a half, with the most re­cent round of lay­offs hap­pen­ing in March of this year. GoPro cut al­most 300 jobs, but more im­por­tantly the com­pany de­cided to com­pletely axe its en­ter­tain­ment di­vi­sion. Shift­ing the over­all fo­cus of the com­pany back to prod­ucts has helped trim some of the fat and rein in ex­penses by about $70 mil­lion com­pared to Q2 of 2016.

That brings us to the sec­ond rea­son, the prod­ucts them­selves - specif­i­cally the Hero 5 Black. Af­ter get­ting off to a slow start in the fall of 2016 be­cause of pro­duc­tion is­sues, the Hero 5 Black has been sell­ing re­ally well for GoPro. Cit­ing data from NPD, GoPro says the Hero 5 Black was the best-sell­ing dig­i­tal cam­era in the US for three straight quar­ters now, and the Hero 5 Ses­sion has been ba­si­cally right be­hind it.

Mean­while GoPro’s other big prod­uct, the Karma drone, has re­bounded from its rocky start - which fea­tured an al­most im­me­di­ate re­call - to be­come the num­ber two best-sell­ing drone in the US last quar­ter. GoPro’s de­ci­sion to kill off a sig­nif­i­cant chunk of its cam­era lineup last year also seems to have helped turn things around.

With the Hero 6 slated for re­lease later this fall, new Karma drones in the works, and the com­pany’s pro cam­era so­lu­tions hum­ming along, GoPro might just be able to make it back to prof­itabil­ity by the end of this year. Con­sid­er­ing it lost al­most $400 mil­lion in 2016, that’s not a bad place to be.

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