After three years of a pandemic-induced strategy that focused on a reduced retail presence by about 30 percent, lower marketing expenditures, and an exit from an entry-level SKU due to supply chain constraints, GoPro has adjusted its go-to-market approach.
The GoPro group believes its new line of attack – restoring product pricing to 2019 levels and re-introducing its entry-level HERO9 Black as key components – will help it increase its global retail distribution, grow its unit sales to over 4 million by the end of 2025, drive adjusted Ebitda over $300 million over the 2024–2025 period, and expand its subscriber base to 3.1 million by end of 2025.
If the adjusted Ebitda target is met, the company will use the proceeds to accelerate stock repurchases and to make additional investments in the business.
“Pandemic-related supply challenges are easing, and lower product and freight costs are enabling us to shift value back to the consumer with more accessible pricing and an entry-level SKU, both of which we expect will bolster growth in units, subscribers, revenue and adjusted Ebitda,” CEO Nicholas Woodman told analysts.
GoPro is reducing pricing on four of its action cameras – HERO11 Black, HERO11 Mini, HERO10 Black, and HERO9 Black – by $100. Lower inbound freight and product costs in conjunction with an improved supply chain are enabling the price adjustment from a margin perspective along with the introduction of new, higher-priced, higher-margin SKUs in the future.
From early analysis, the price adjustments are said to be having a positive impact on demand in Europe and the U.S. by double or triple what the company had projected.
Besides its updated go-to-market strategy, the group is introducing several new products later this year. They include a Q4 launch of a new desktop editing experience that will be included in the current GoPro subscription at no additional charge.
In Q1, GoPro reported a net loss of $29.9 million against a profit of $5.7 million for the period ended March 31. Period revenues were down by 19.4 percent to $174.7 million from $216.7 million as gross margins declined to 30.0 percent from 41.8 percent in the year-ago period.
