Q1 Earnings Don’t Tell the Whole Story for GoPro Inc.
Prepare yourself as you’re about to see a wild swing in GoPro’s inventory value. It’s unlike anything you’ve seen before. In 2015, a lot of people advocated for GoPro stock regularly throughout the year and it turned out to be some of the worst calls of the year. These are some of the metrics that inventory traders ought to look for when the Q1 earnings report is released on Thursday.
GoPro Stock: It’s Not about Q1
It is very apparent that first quarter results are going to be bad and this is known across many quarters. When GoPro announced Q4 earnings in early February, in addition to the guidance for Q1 and for FY2016, they weren’t looking so good.
And these earnings are expected to crash and plunge by 53.4% year over year to about $169.08 million. Perhaps more significant is the guidance that the management issued this quarter, a dreadful first quarter is anticipated.
As a result of some of these things, Wall Street certainly isn’t confident in GoPro’s abilities due to the consensus estimates that are calling for 2016 sales at $1.37 billion which falls short of the Inc’s own $1.425 billion. Herein lies the issue. A significant cost for GoPro stock really depends on what the demand will look like for its Karma quad copter drone and the company has indicated that it will debut in the 1st half of 2016. Nobody can tell how things will go as nobody has the specifications or price of the unit.
GoPro stock is at a crucial moment. Having already lost the confidence of major investors, Nick Woodman’s company will have to show that it can hang with the big names and come back from a really disastrous run. As far thins go, the guidance remains the same and GoPro insists its full year revenue guidance range between $1.35 billion and $1.5 billion.
At the latter part of this year, GoPro’s quadcopter drone which is still unpriced and its 360-degree camera rig and the hero5 which is due for release by October will drive results or at least we expect them to.
As for the first quarter, GoPro stressed the fact that it’s Hero4 silver camera was the “best-selling digital image camera on a unit and dollar basis” in the United States. They also stressed that the opening of their first retail store in China and international sales is responsible for over 50 percent of revenue.
The GoPro Hero5 is another version of its formerly popular wearable camera device and it is expected from launch by October. Unless the GoPro quad copter flies off the ledges, the all-round expression for GoPro inventory could be very painful.
So far there has been no significant developments in terms of earnings from GoPro and it is assumed that more information will come to light on this soon enough. At the end of the day, the issue with GoPro stock is that it’s very insecure right now. Sales have taken a downward turn and there is a real issue to be made of how much of this is due to the increasing functionality and versatility of smartphones which won’t be going anywhere anytime soon.