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GoPro, Inc. (GPRO)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 revenue of $163M declined 37% YoY with gross margin ~35%, but operating execution improved: cash from operations turned positive ($12M) and channel inventory fell 30% YoY; management reiterated a return to revenue growth and profitability beginning in Q4 2025 and in 2026 .
  • EPS missed limited Street consensus: non-GAAP diluted EPS was $(0.09) vs S&P Global consensus of $(0.04)* as volumes fell 37% YoY and adjusted EBITDA was $(7.9)M; gross margin held roughly flat YoY (–40 bps) .
  • Q4 guide: revenue ~$220M (midpoint, +10% YoY), non‑GAAP EPS $0.03 ± $0.02, adjusted EBITDA +$12M; GM ~32% (would be ~37% ex-tariffs), units sell-through ~625k with Street ASP ~ $350 .
  • Catalysts: launch of MAX2, LIT HERO, Fluid Pro AI; founder/CEO invested $2M in common stock; 2026 guide to ≥$40M adjusted EBITDA, GP3 processor platform rollout, continued cost discipline and supply-chain diversification .

What Went Well and What Went Wrong

  • What Went Well

    • Positive operating cash flow ($12M) for a second consecutive quarter; channel inventory down 30% YoY and sell-through 5% above plan, indicating healthier channel dynamics .
    • New product cycle broadened TAM: MAX2 360 with true 8K and twist‑and‑go lenses, LIT HERO lifestyle camera, Fluid Pro AI gimbal; CEO: “Q3 marked a meaningful step forward in our strategy to diversify, grow and restore profitability” .
    • Clear path to profitability: CFO guided Q4 non‑GAAP EPS to $0.03 ± $0.02 and 2026 adjusted EBITDA ≥ $40M; CEO flagged 2026 “year of GP3,” elevating performance across the lineup .

  • What Went Wrong

    • Large top‑line decline: revenue down 37% YoY to $162.9M; non‑GAAP net loss $(13.9)M; adjusted EBITDA $(7.9)M vs +$5.4M last year, reflecting volume pressure .
    • EPS miss vs S&P Global consensus: $(0.09) non‑GAAP vs $(0.04)*; the mix of lower unit volumes and flat gross margin offset OpEx cuts; management also highlighted tariff headwinds pressuring Q4 margin .
    • Subscribers drifted lower (2.42M, –5% YoY) and subscription & services revenue fell 3% YoY to $27M, tempering a near‑term recurring revenue offset .

Financial Results

MetricQ3 2024Q2 2025Q3 2025
Revenue ($M)$258.9 $152.6 $162.9
GAAP Gross Margin %35.5% 35.8% 35.1%
Non-GAAP Gross Margin %35.6% 36.0% 35.2%
GAAP Diluted EPS ($)$(0.05) $(0.10) $(0.13)
Non‑GAAP Diluted EPS ($)$(0.00) $(0.08) $(0.09)
Adjusted EBITDA ($M)$5.4 $(5.7) $(7.9)
Cash from Operations ($M)$(2.2) $8.8 $12.2

Channel and KPI details:

KPIQ2 2025Q3 2025
Sell-through (camera units)~500k ~500k
Subscription & Services Revenue ($M)$26 $27
Subscribers (M, period end)2.45 2.42
Retail Revenue ($M, % mix)$111 (73%) $123 (75%)
GoPro.com Revenue incl. Sub/Services ($M, % mix)$41 (27%) $40 (25%)
Channel inventory YoYn/a–30%

Estimate vs Actual:

ItemQ3 2025 S&P ConsensusQ3 2025 Actual
Non‑GAAP Diluted EPS ($)$(0.04)*$(0.09)
Revenue ($M)n/a*$162.9

Values with asterisk were retrieved from S&P Global.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueQ4 2025n/a~$220M (midpoint, +10% YoY) New
Non‑GAAP Diluted EPSQ4 2025n/a$0.03 ± $0.02 New
Adjusted EBITDAQ4 2025n/a+$12M New
Gross MarginQ4 2025n/a~32% (would be ~37% ex‑tariffs) New / tariff‑impacted
Unit Sell‑throughQ4 2025n/a~625k (midpoint) New
Street ASPQ4 2025n/a~$350 New
OpEx (non‑GAAP)Q4 2025n/a~$63M New
Shares OutstandingQ4 2025n/a~177M New
YE Cash & EquivalentsFY 2025n/a$60–$65M; +$50M ABL availability New
Adjusted EBITDAFY 2026n/a≥$40M New
OpEx (non‑GAAP)FY 2026n/a~$250M (slightly down YoY) New
Tariff CostsFY 2026n/a~$45M; expect ~½ offset by pricing/diversification New
SubscribersFY 2026n/a~2.4M (up ~2%) New
Subscription RPUFY 2026n/a+5% YoY New
YE Cash & LiquidityFY 2026n/aYE cash ~$80M ± $5M; +$50M ABL availability New

Additional balance sheet/capital actions: amended second‑lien credit agreement to adjust interim 2026 covenants for tariff hikes (10%→19%); CEO affiliated trust invested $2M in Class A shares .

Earnings Call Themes & Trends

TopicQ1 2025 (two quarters back)Q2 2025 (prior quarter)Q3 2025 (current)Trend
Product diversification & roadmapFocus on cost actions; accessories and colorways; preparing broader 2H25 lineup Set stage for broader, more diversified HW/SW in 2H25; AI Training program announced Launched MAX2, LIT HERO, Fluid Pro AI; 2026 “year of GP3” Improving cadence/visibility
AI/Software360 editing enhancements; app improvements Opt‑in AI Training program (licensing content) AI features in Quik (subject tracking), ReFrame plug‑in; Fluid Pro AI gimbal Expanding capabilities
Supply chain & tariffsDiversification; navigating tariffs GM improved to 36.0%; continued efficiency Tariffs key headwind; Q4 GM 32% (37% ex‑tariffs) Tariff headwind intensifying
Channel health—Sell‑through ~500k; execution improved Sell‑through ~500k; channel inventory –30% YoY; +5% vs plan Inventory normalization
Legal/regulatory—ITC initial determination vs Insta360 re: HERO design patent —Pending outcome
Profitability outlook—“Restore revenue growth & profitability” Q4 2025 Guide to Q4 profit; 2026 ≥$40M adj. EBITDA Confidence rising

Management Commentary

  • “Q3 marked a meaningful step forward in our strategy to diversify, grow and restore profitability to GoPro's business.” — Nicholas Woodman, Founder & CEO .
  • “We generated $12 million in cash flow from operations… sell-through exceeded our expectations by 5% and channel inventory declined 30% from a year ago.” — Brian McGee, CFO & COO .
  • “For the fourth quarter, we expect revenue growth at the midpoint of guidance of 10% to $220 million… non‑GAAP net income per share of $0.03 ± $0.02, and adjusted EBITDA of positive $12 million.” — Brian McGee .
  • “2026 will be the year of GP3… the debut of our line of GP3‑based processors that'll take GoPro and the industry to the next level of performance.” — Nicholas Woodman .

Q&A Highlights

  • Q4 sell‑through down ~18% YoY despite three new cameras; management explained no new flagship HERO was launched in Q3 to set up a bigger HERO upgrade cycle in 2026; diversification strategy should expand TAM and drive multi‑SKU adoption .
  • 2026 outlook confidence grounded in diversified product cadence throughout the year and GP3 platform; expectation for consistent YoY unit and revenue growth per quarter in 2026 .
  • Margin color: Q4 GM guided ~32% due to tariffs; ex‑tariff GM would be ~37%; partial offsets planned via pricing and supply‑chain actions .

Estimates Context

  • Q3 2025 EPS missed S&P Global consensus: $(0.09) vs $(0.04), reflecting a 37% YoY revenue decline and negative adjusted EBITDA despite stable GM; revenue consensus was unavailable for comparison .
  • Forward: Q4 2025 non‑GAAP EPS guide $0.03 ± $0.02 vs S&P consensus of $0.04*; management’s tariff‑driven GM guide (~32%) may prompt Street margin revisions even as revenue is guided to ~$220M .

Values with asterisk were retrieved from S&P Global.

Key Takeaways for Investors

  • Near‑term: Expect Q4 revenue growth (~$220M) and a small profit on non‑GAAP EPS ($0.03 ± $0.02) with improved adjusted EBITDA (+$12M), but GM headwinds from tariffs cap upside; unit sell‑through down YoY, offset by ASP and sell‑in dynamics .
  • Execution: Two straight quarters of positive operating cash flow and a 30% YoY channel inventory reduction improve balance‑of‑year risk profile; founder’s $2M purchase signals internal confidence .
  • 2026 Setup: Clear profitability target (≥$40M adj. EBITDA) and a broadened roadmap anchored by GP3; OpEx discipline (~$250M) and partial tariff offsets support margin recovery potential .
  • Watch items: Tariff trajectory (cited in credit amendment), subscriber trajectory (stabilization/renewal in 2026), and cadence of new products/services through 2026 .
  • Stock drivers: Delivery vs Q4 guide, holiday sell‑in/sell‑through balance, early traction of MAX2/LIT HERO/Fluid Pro AI, and clarity on HERO flagship timing into 2026 .

Notes on non‑GAAP: The company’s non‑GAAP results exclude stock‑based comp, acquisition‑related costs, restructuring costs, gains/losses on insurance proceeds, extinguishment of debt, revaluation of warrants, goodwill impairment, and related tax effects; guidance is presented primarily on a non‑GAAP basis per company practice .