GoPro: U.S. and Europe are hostile, we must cut jobs
GoPro expects revenue to be approximately $340 million for the fourth quarter of 2017.
Fourth quarter revenue includes a negative impact of approximately $80 million for price protection on HERO6 Black, HERO5 Black and HERO5 Session cameras, as well as the Karma drone.
GoPro expects GAAP gross margin for the fourth quarter of 2017 to be between 24% and 26%. Non-GAAP gross margin for the fourth quarter of 2017 is expected to be between 25% and 27%.
Non-GAAP gross margin for the same period, excluding the price protection impact of $80 million and other charges of between $19 million and $21 million, is expected to be between 44% and 46%.
GoPro expects GAAP operating expenses to be between $136 million and $140 million for the fourth quarter of 2017 and non-GAAP operating expenses to be between $118 million and $122 million for the same period.
GoPro ended the fourth quarter with cash and cash equivalents of $247 million, up $50 million over the third quarter of 2017.
"GoPro is reducing its global workforce from 1,254 employees as of September 30, 2017 to fewer than 1,000 employees worldwide.
"GoPro founder and CEO Nicholas Woodman will reduce his 2018 cash compensation to $1.
"Although Karma reached the #2 market position in its price band in 2017, the product faces margin challenges in an extremely competitive aerial market.
"Furthermore, a hostile regulatory environment in Europe and the United States will likely reduce the total addressable market in the years ahead," the company said.
A restructuring of GoPro's business will result in an estimated aggregate charge of $23 million to $33 million, including approximately $13 million to $18 million of cash expenditures as a result of a reduction in force, substantially all of which are severance and related costs, as well as approximately $10 million to $15 million of other charges, consisting primarily of non-cash items.
GoPro expects to recognize most of the restructuring charges in the first quarter of 2018. ■