PR Newswire
SAN MATEO, Calif., Feb. 1, 2018
SAN MATEO, Calif., Feb. 1, 2018 /PRNewswire/ -- GoPro, Inc. (NASDAQ: GPRO) announced financial results for its fourth quarter and full year ended December 31, 2017. The Company recorded full year 2017 revenue of $1.18 billion, flat year-over-year. Operating expenses decreased by more than 30% year-over-year. The Company ended the year with $247 million in cash and marketable securities - up $50 million from the third quarter.
"The fourth quarter demonstrated there is significant demand for GoPro products at the right price," said GoPro founder and CEO Nicholas Woodman. "Our opportunity in 2018 is to marry consumer demand for GoPro with new, higher margin cameras launching in the second half that will appeal to existing and new consumers. We are also focused on growing GoPro's subscription service, Plus, and launching new initiatives as subscription becomes an increasingly important focus for our business."
Recent GoPro Highlights:
Results Summary
Three Months Ended December 31, |
Year Ended December 31, | |||||||||||||||||||||
($ in thousands, except per share amounts) |
2017 |
2016 |
% Change |
2017 |
2016 |
% Change | ||||||||||||||||
Revenue |
$ |
334,796 |
$ |
540,621 |
(38.1) |
% |
$ |
1,179,741 |
$ |
1,185,481 |
(0.5) |
% | ||||||||||
Gross margin |
||||||||||||||||||||||
GAAP |
23.8 |
% |
39.2 |
% |
(1,540) bps |
32.6 |
% |
39.0 |
% |
(640) bps | ||||||||||||
Non-GAAP |
24.8 |
% |
39.5 |
% |
(1,470) bps |
33.3 |
% |
39.3 |
% |
(600) bps | ||||||||||||
Operating income (loss) |
||||||||||||||||||||||
GAAP |
$ |
(58,311) |
$ |
(26,568) |
(119.5) |
% |
$ |
(163,460) |
$ |
(372,969) |
56.2 |
% | ||||||||||
Non-GAAP |
$ |
(37,427) |
$ |
31,639 |
(218.3) |
% |
$ |
(82,922) |
$ |
(243,007) |
65.9 |
% | ||||||||||
Net income (loss) |
||||||||||||||||||||||
GAAP |
$ |
(55,848) |
$ |
(115,709) |
51.7 |
% |
$ |
(182,873) |
$ |
(419,003) |
56.4 |
% | ||||||||||
Non-GAAP |
$ |
(41,319) |
$ |
42,367 |
(197.5) |
% |
$ |
(95,867) |
$ |
(201,247) |
52.4 |
% | ||||||||||
Diluted net income (loss) per share |
||||||||||||||||||||||
GAAP |
$ |
(0.41) |
$ |
(0.82) |
50.0 |
% |
$ |
(1.32) |
$ |
(3.01) |
56.1 |
% | ||||||||||
Non-GAAP |
$ |
(0.30) |
$ |
0.29 |
(203.4) |
% |
$ |
(0.69) |
$ |
(1.44) |
52.1 |
% | ||||||||||
Adjusted EBITDA |
$ |
(26,544) |
$ |
44,343 |
(159.9) |
% |
$ |
(31,368) |
$ |
(192,807) |
83.7 |
% |
Conference Call
GoPro management will host a conference call and live webcast for analysts and investors today at 2 p.m. Pacific Time (5 p.m. Eastern Time) to discuss the Company's financial results.
To listen to the live conference call, please dial toll free (888) 271-8595 or (719) 325-2484, access code 2807712, approximately 5 minutes prior to the start of the call. A live webcast of the conference call will be accessible on the "Events & Presentations" section of the Company's website at http://investor.gopro.com . A recording of the webcast will be available on GoPro's website, http://investor.gopro.com, approximately two hours after the call and for 90 days thereafter.
About GoPro, Inc. (NASDAQ: GPRO)
GoPro makes it easy for people to celebrate and share experiences. We believe life is more meaningful when shared. We build cameras, software and accessories that help the world share itself in immersive and exciting ways.
GoPro, HERO, Quik, QuikStories and their respective logos are trademarks or registered trademarks of GoPro, Inc. in the United States and other countries. All other trademarks are the property of their respective owners. For more information, visit www.gopro.com or connect with GoPro on Facebook, Instagram, LinkedIn, Pinterest, Twitter, YouTube, and GoPro's The Inside Line.
GoPro's Use of Social Media
GoPro announces material financial information using the Company's investor relations website, SEC filings, press releases, public conference calls and webcasts. GoPro may also use social media channels to communicate about the Company, its brand and other matters; these communications could be deemed material information. Investors and others are encouraged to review posts on GoPro's pages on Facebook, Instagram, LinkedIn, Pinterest, Twitter, YouTube, GoPro's investor relations website and The Inside Line.
Note Regarding Use of Non-GAAP Financial Measures
GoPro reports gross profit, gross margin, operating expenses, operating income (loss), net income (loss) and diluted net income (loss) per share in accordance with U.S. generally accepted accounting principles (GAAP) and on a non-GAAP basis. Additionally, GoPro reports non-GAAP adjusted EBITDA. Non-GAAP items exclude, where applicable, the effects of stock-based compensation, acquisition-related costs, restructuring costs, non-cash interest expense and the tax impact of these items. A reconciliation to 2018 target GAAP gross margin and operating expenses have not been provided because doing so would require an unreasonable effort due to the unavailability of information needed to calculate reconciling items and due to the variability, complexity and limited visibility of the adjusting items that would be excluded from the non-GAAP financial measures in future periods.
Note on Forward-looking Statements
This press release may contain projections or other forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Forward-looking statements in this press release include, but are not limited to, expectations regarding our business outlook for 2018. These statements involve risks and uncertainties, and actual events or results may differ materially. Among the important factors that could cause actual results to differ materially from those in the forward-looking statements are the risk that our reduction in operating expenses may impact our ability to meet our business objectives and achieve our revenue targets and may not result in the expected improvement in our profitability; the fact that our future growth depends in part on further penetrating our addressable market and growing internationally, and we may not be successful in doing so; any inability to successfully manage frequent product introductions (including our 2018 roadmap for new hardware and software products and major new software features) and transitions, including managing our sales channel and inventory and accurately forecasting future sales; our reliance on third party suppliers, some of which are sole source suppliers, to provide components for our products; our dependence on sales of our cameras, mounts and accessories for substantially all of our revenue; the effect of a decrease in the sales or change in sales mix of these products; the effect of a decrease in sales during the holiday season; the fact that an economic downturn or economic uncertainty in our key U.S. and international markets may adversely affect consumer discretionary spending and demand for our products; any inability to anticipate consumer preferences and successfully develop and market desirable products; the effects of the highly competitive market in which we operate; the fact that we may not be able to achieve revenue growth or profitability in the future; risks related to inventory, purchase commitments and long-lived assets; the importance of maintaining the value and reputation of our brand; and other factors detailed in the Risk Factors section of our Annual Report on Form 10-K for the year ended December 31, 2016, which is on file with the Securities and Exchange Commission and as supplemented by Item 1A Risk Factors in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2017. These forward-looking statements speak only as of the date hereof or as of the date otherwise stated herein. GoPro disclaims any obligation to update these forward-looking statements.
GoPro, Inc. | |||||||||||||||
Preliminary Condensed Consolidated Statement of Operations | |||||||||||||||
(unaudited) | |||||||||||||||
Three months ended |
Twelve months ended | ||||||||||||||
(in thousands, except per share data) |
December 31, |
December 31, |
December 31, |
December 31, | |||||||||||
Revenue |
$ |
334,796 |
$ |
540,621 |
$ |
1,179,741 |
$ |
1,185,481 |
|||||||
Cost of revenue |
255,010 |
328,486 |
795,211 |
723,561 |
|||||||||||
Gross profit |
79,786 |
212,135 |
384,530 |
461,920 |
|||||||||||
Operating expenses: |
|||||||||||||||
Research and development |
52,504 |
92,728 |
229,265 |
358,902 |
|||||||||||
Sales and marketing |
65,425 |
112,716 |
236,581 |
368,620 |
|||||||||||
General and administrative |
20,168 |
33,259 |
82,144 |
107,367 |
|||||||||||
Total operating expenses |
138,097 |
238,703 |
547,990 |
834,889 |
|||||||||||
Operating loss |
(58,311) |
(26,568) |
(163,460) |
(372,969) |
|||||||||||
Other income (expense): |
|||||||||||||||
Interest expense |
(4,508) |
(1,177) |
(13,660) |
(2,992) |
|||||||||||
Other income, net |
28 |
(573) |
733 |
787 |
|||||||||||
Total other expense, net |
(4,480) |
(1,750) |
(12,927) |
(2,205) |
|||||||||||
Loss before income taxes |
(62,791) |
(28,318) |
(176,387) |
(375,174) |
|||||||||||
Income tax expense (benefit) |
(6,943) |
87,391 |
6,486 |
43,829 |
|||||||||||
Net loss |
$ |
(55,848) |
$ |
(115,709) |
$ |
(182,873) |
$ |
(419,003) |
|||||||
Net loss per share: |
|||||||||||||||
Basic |
$ |
(0.41) |
$ |
(0.82) |
$ |
(1.32) |
$ |
(3.01) |
|||||||
Diluted |
$ |
(0.41) |
$ |
(0.82) |
$ |
(1.32) |
$ |
(3.01) |
|||||||
Weighted-average shares used to compute net loss per share: |
|||||||||||||||
Basic |
136,886 |
141,063 |
138,056 |
139,425 |
|||||||||||
Diluted |
136,886 |
141,063 |
138,056 |
139,425 |
GoPro, Inc. | |||||||
Preliminary Condensed Consolidated Balance Sheets | |||||||
(unaudited) | |||||||
(in thousands) |
December 31, |
December 31, | |||||
Assets |
|||||||
Current assets: |
|||||||
Cash and cash equivalents |
$ |
202,504 |
$ |
192,114 |
|||
Marketable securities |
44,886 |
25,839 |
|||||
Accounts receivable, net |
112,935 |
164,553 |
|||||
Inventory |
150,551 |
167,192 |
|||||
Prepaid expenses and other current assets |
62,811 |
38,115 |
|||||
Total current assets |
573,687 |
587,813 |
|||||
Property and equipment, net |
68,587 |
76,509 |
|||||
Intangible assets, net and goodwill |
170,958 |
179,989 |
|||||
Other long-term assets |
37,014 |
78,329 |
|||||
Total assets |
$ |
850,246 |
$ |
922,640 |
|||
Liabilities and Stockholders' Equity |
|||||||
Current liabilities: |
|||||||
Accounts payable |
$ |
138,257 |
$ |
205,028 |
|||
Accrued liabilities |
213,030 |
211,323 |
|||||
Deferred revenue |
19,244 |
14,388 |
|||||
Total current liabilities |
370,531 |
430,739 |
|||||
Long-term debt |
130,048 |
— |
|||||
Other long-term liabilities |
50,962 |
44,956 |
|||||
Total liabilities |
551,541 |
475,695 |
|||||
Stockholders' equity: |
|||||||
Common stock and additional paid-in capital |
854,452 |
757,226 |
|||||
Treasury stock, at cost |
(113,613) |
(35,613) |
|||||
Accumulated deficit |
(442,134) |
(274,668) |
|||||
Total stockholders' equity |
298,705 |
446,945 |
|||||
Total liabilities and stockholders' equity |
$ |
850,246 |
$ |
922,640 |
GoPro, Inc. | |||||||||||||||
Preliminary Condensed Consolidated Statement of Cash Flows | |||||||||||||||
(unaudited) | |||||||||||||||
Three months ended |
Twelve months ended | ||||||||||||||
(in thousands) |
December 31, |
December 31, |
December 31, |
December 31, | |||||||||||
Operating activities: |
|||||||||||||||
Net loss |
$ |
(55,848) |
$ |
(115,709) |
$ |
(182,873) |
$ |
(419,003) | |||||||
Adjustments to reconcile net loss to net cash used in operating activities: |
|||||||||||||||
Depreciation and amortization |
9,218 |
11,100 |
41,478 |
41,640 | |||||||||||
Stock-based compensation |
15,020 |
17,926 |
51,255 |
69,527 | |||||||||||
Excess tax benefit from stock-based compensation |
— |
(1,089) |
— |
(3,463) | |||||||||||
Deferred income taxes |
(709) |
59,524 |
(2,527) |
38,568 | |||||||||||
Non-cash restructuring charges |
3,456 |
17,601 |
7,315 |
17,601 | |||||||||||
Impairment of intangible assets |
— |
1,088 |
— |
7,088 | |||||||||||
Non-cash interest expense |
1,979 |
— |
5,345 |
— | |||||||||||
Other |
203 |
2,820 |
4,094 |
7,574 | |||||||||||
Net changes in operating assets and liabilities |
83,671 |
19,435 |
39,060 |
132,715 | |||||||||||
Net cash provided by (used in) operating activities |
56,990 |
12,696 |
(36,853) |
(107,753) | |||||||||||
Investing activities: |
|||||||||||||||
Purchases of property and equipment, net |
(5,748) |
(17,111) |
(24,061) |
(43,627) | |||||||||||
Purchases of marketable securities |
(20,400) |
— |
(52,318) |
— | |||||||||||
Maturities of marketable securities |
7,499 |
26,694 |
21,659 |
119,918 | |||||||||||
Sale of marketable securities |
— |
40,557 |
11,623 |
47,348 | |||||||||||
Acquisitions, net of cash acquired |
— |
— |
— |
(104,353) | |||||||||||
Net cash provided by (used in) investing activities |
(18,649) |
50,140 |
(43,097) |
19,286 | |||||||||||
Financing activities: |
|||||||||||||||
Proceeds from issuance of common stock |
128 |
3,462 |
9,751 |
9,664 | |||||||||||
Taxes paid related to net share settlement of equity awards |
(840) |
(6,029) |
(12,118) |
(6,889) | |||||||||||
Proceeds from issuance of convertible senior notes |
— |
— |
175,000 |
— | |||||||||||
Prepayment of forward stock repurchase transaction |
— |
— |
(78,000) |
— | |||||||||||
Excess tax benefit from stock-based compensation |
— |
1,089 |
— |
3,463 | |||||||||||
Payment of deferred acquisition-related consideration |
1 |
— |
(75) |
(950) | |||||||||||
Payment of credit facility issuance costs |
(1) |
(46) |
(5,964) |
(3,333) | |||||||||||
Net cash provided by (used in) financing activities |
(712) |
(1,524) |
88,594 |
1,955 | |||||||||||
Effect of exchange rate changes on cash and cash equivalents |
259 |
(775) |
1,746 |
(1,046) | |||||||||||
Net increase (decrease) in cash and cash equivalents |
37,888 |
60,537 |
10,390 |
(87,558) | |||||||||||
Cash and cash equivalents at beginning of period |
164,616 |
131,577 |
192,114 |
279,672 | |||||||||||
Cash and cash equivalents at end of period |
$ 202,504 |
$ |
192,114 |
$ 202,504 |
$ |
192,114 |
GoPro, Inc.
Reconciliation of Preliminary GAAP to Non-GAAP Financial Measures
To supplement our unaudited selected financial data presented on a basis consistent with GAAP, we disclose certain non-GAAP financial measures, including non-GAAP gross profit, gross margin, operating expenses, operating income (loss), net income (loss), diluted net income (loss) per share and adjusted EBITDA. We also provide forecasts of non-GAAP gross margin, non-GAAP operating expenses, non-GAAP net income (loss) and non-GAAP diluted net income (loss) per share. We use these non-GAAP financial measures to help us understand and evaluate our core operating performance and trends, to prepare and approve our annual budget, and to develop short-term and long-term operational plans. We believe that these measures provide useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors. These non-GAAP financial measures should not be considered in isolation from, or as an alternative to, the measures prepared in accordance with GAAP, and are not based on any comprehensive set of accounting rules or principles. We believe that these non-GAAP measures, when read in conjunction with our GAAP financials, provide useful information to investors by facilitating:
These non-GAAP financial measures have limitations in that they do not reflect all of the amounts associated with our results of operations as determined in accordance with GAAP. Some of these limitations are:
GoPro, Inc. | |||||||||||||||
Reconciliation of Preliminary GAAP to Non-GAAP Financial Measures | |||||||||||||||
(unaudited) | |||||||||||||||
Reconciliations of non-GAAP financial measures are set forth below: | |||||||||||||||
Three months ended |
Twelve months ended | ||||||||||||||
(in thousands, except per share data) |
December 31, |
December 31, |
December 31, |
December 31, | |||||||||||
GAAP net loss |
$ |
(55,848) |
$ |
(115,709) |
$ |
(182,873) |
$ |
(419,003) |
|||||||
Stock-based compensation: |
|||||||||||||||
Cost of revenue |
580 |
421 |
1,935 |
1,616 |
|||||||||||
Research and development |
7,924 |
10,230 |
24,963 |
31,365 |
|||||||||||
Sales and marketing |
3,203 |
3,184 |
10,498 |
13,883 |
|||||||||||
General and administrative |
3,313 |
4,091 |
13,859 |
22,663 |
|||||||||||
Total stock-based compensation |
15,020 |
17,926 |
51,255 |
69,527 |
|||||||||||
Acquisition-related costs: |
|||||||||||||||
Cost of revenue |
2,360 |
1,093 |
5,985 |
1,759 |
|||||||||||
Research and development |
— |
2,581 |
3,028 |
14,439 |
|||||||||||
Sales and marketing |
— |
— |
— |
22 |
|||||||||||
General and administrative |
— |
26 |
(22) |
1,126 |
|||||||||||
Total acquisition-related costs |
2,360 |
3,700 |
8,991 |
17,346 |
|||||||||||
Restructuring costs: |
|||||||||||||||
Cost of revenue |
176 |
133 |
634 |
497 |
|||||||||||
Research and development |
1,686 |
14,542 |
10,092 |
17,197 |
|||||||||||
Sales and marketing |
1,087 |
9,386 |
7,047 |
12,064 |
|||||||||||
General and administrative |
555 |
12,520 |
2,519 |
13,331 |
|||||||||||
Total restructuring costs |
3,504 |
36,581 |
20,292 |
43,089 |
|||||||||||
Non-cash interest expense |
1,979 |
— |
5,345 |
— |
|||||||||||
Income tax adjustments |
(8,334) |
99,869 |
1,123 |
87,794 |
|||||||||||
Non-GAAP net income (loss) |
$ |
(41,319) |
$ |
42,367 |
$ |
(95,867) |
$ |
(201,247) |
|||||||
GAAP shares for diluted net loss per share |
136,886 |
141,063 |
138,056 |
139,425 |
|||||||||||
Add: dilutive shares |
— |
5,198 |
— |
— |
|||||||||||
Non-GAAP shares for diluted net income (loss) per share |
136,886 |
146,261 |
138,056 |
139,425 |
|||||||||||
Non-GAAP diluted net income (loss) per share |
$ |
(0.30) |
$ |
0.29 |
$ |
(0.69) |
$ |
(1.44) |
|||||||
Three months ended |
Twelve months ended | ||||||||||||||
(dollars in thousands) |
December 31, |
December 31, |
December 31, |
December 31, | |||||||||||
GAAP gross profit |
$ |
79,786 |
$ |
212,135 |
$ |
384,530 |
$ |
461,920 |
|||||||
Stock-based compensation |
580 |
421 |
1,935 |
1,616 |
|||||||||||
Acquisition-related costs |
2,360 |
1,093 |
5,985 |
1,759 |
|||||||||||
Restructuring costs |
176 |
133 |
634 |
497 |
|||||||||||
Non-GAAP gross profit |
$ |
82,902 |
$ |
213,782 |
$ |
393,084 |
$ |
465,792 |
|||||||
GAAP gross profit as a % of revenue |
23.8 |
% |
39.2 |
% |
32.6 |
% |
39.0 |
% | |||||||
Stock-based compensation |
0.2 |
0.1 |
0.2 |
0.1 |
|||||||||||
Acquisition-related costs |
0.7 |
0.2 |
0.5 |
0.2 |
|||||||||||
Restructuring costs |
0.1 |
— |
— |
— |
|||||||||||
Non-GAAP gross profit as a % of revenue |
24.8 |
% |
39.5 |
% |
33.3 |
% |
39.3 |
% | |||||||
GAAP operating expenses |
$ |
138,097 |
$ |
238,703 |
$ |
547,990 |
$ |
834,889 |
|||||||
Stock-based compensation |
(14,440) |
(17,505) |
(49,320) |
(67,911) |
|||||||||||
Acquisition-related costs |
— |
(2,607) |
(3,006) |
(15,587) |
|||||||||||
Restructuring costs |
(3,328) |
(36,448) |
(19,658) |
(42,592) |
|||||||||||
Non-GAAP operating expenses |
$ |
120,329 |
$ |
182,143 |
$ |
476,006 |
$ |
708,799 |
|||||||
GAAP operating loss |
$ |
(58,311) |
$ |
(26,568) |
$ |
(163,460) |
$ |
(372,969) |
|||||||
Stock-based compensation |
15,020 |
17,926 |
51,255 |
69,527 |
|||||||||||
Acquisition-related costs |
2,360 |
3,700 |
8,991 |
17,346 |
|||||||||||
Restructuring costs |
3,504 |
36,581 |
20,292 |
43,089 |
|||||||||||
Non-GAAP operating income (loss) |
$ |
(37,427) |
$ |
31,639 |
$ |
(82,922) |
$ |
(243,007) |
|||||||
Three months ended |
Twelve months ended | ||||||||||||||
(in thousands) |
December 31, |
December 31, |
December 31, |
December 31, | |||||||||||
GAAP net loss |
$ |
(55,848) |
$ |
(115,709) |
$ |
(182,873) |
$ |
(419,003) |
|||||||
Income tax expense (benefit) |
(6,943) |
87,391 |
6,486 |
43,829 |
|||||||||||
Interest expense, net |
4,163 |
1,022 |
12,804 |
1,401 |
|||||||||||
Depreciation and amortization |
9,218 |
11,100 |
41,478 |
41,639 |
|||||||||||
POP display amortization |
4,342 |
4,944 |
19,190 |
19,623 |
|||||||||||
Stock-based compensation |
15,020 |
17,926 |
51,255 |
69,527 |
|||||||||||
Impairment of intangible assets |
— |
1,088 |
— |
7,088 |
|||||||||||
Restructuring costs |
3,504 |
36,581 |
20,292 |
43,089 |
|||||||||||
Adjusted EBITDA |
$ |
(26,544) |
$ |
44,343 |
$ |
(31,368) |
$ |
(192,807) |
View original content with multimedia:http://www.prnewswire.com/news-releases/gopro-announces-fourth-quarter-and-full-year-2017-results-300592276.html
SOURCE GoPro, Inc.
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