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GoPro, Inc. (GPRO)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 revenue was $200.9M, down 32% YoY, with GAAP EPS of $(0.24) and non-GAAP EPS of $(0.09); gross margin improved modestly YoY to 34.7% GAAP/35.1% non-GAAP .
  • Management guided Q1 2025 revenue to $125M ± $10M, GM ~35%, OpEx ~$63M ± $2M, and non-GAAP loss per share of ~$0.13, while reiterating FY25 OpEx reduction to $250–$260M and >100 bps GM improvement vs 2024 .
  • Subscription ARPU improved 8% YoY; aggregate retention reached a record 69% and ASP rose to $346 (+5% YoY). Channel inventory fell by >170k units in Q4, supporting price discipline and margin focus .
  • Stock reaction catalysts: aggressive OpEx cuts, confirmed GP3 SoC validation, near-term MAX re-introduction followed by MAX2 in 2025, and tariff risk mitigation via diversified supply chain .

What Went Well and What Went Wrong

What Went Well

  • Gross margin improved: GAAP 34.7%/non-GAAP 35.1% vs 34.2%/34.4% last year; management cited cost reductions, supply chain diversification, and operational efficiencies supporting margin trajectory .
  • Subscription economics strengthened: ARPU +8% YoY; aggregate retention 69% (up both sequentially and YoY); subscriber base ended Q4 at 2.52M (+1% YoY) .
  • Pricing/ASP discipline amid lower volumes: Street ASP $346 (+5% YoY); channel inventory reduced by >170k units in Q4, helping balance channel health .

What Went Wrong

  • Top-line pressure: Q4 revenue down 32% YoY to $200.9M; retail channel down 34% YoY; GoPro.com down 24% YoY, reflecting macro headwinds and competitive intensity .
  • Profitability: non-GAAP net loss of $14.4M; adjusted EBITDA $(14.4)M; GAAP EPS $(0.24), non-GAAP EPS $(0.09) vs $0.03 non-GAAP last year .
  • Product timing/FX: MAX2 delay weighed on unit/revenue outlook; stronger USD hit Q4 gross margin by ~80 bps vs guidance; management expects 2025 units/revenue below 2024 before a 2026 recovery .

Financial Results

Consolidated P&L and Margins (Sequential Comparison)

MetricQ2 2024Q3 2024Q4 2024
Revenue ($USD Millions)$186.2 $258.9 $200.9
GAAP Gross Margin (%)30.5% 35.5% 34.7%
Non-GAAP Gross Margin (%)30.7% 35.6% 35.1%
GAAP EPS ($)$(0.31) $(0.05) $(0.24)
Non-GAAP EPS ($)$(0.24) $0.00 $(0.09)
Adjusted EBITDA ($USD Millions)$(33.4) $5.4 $(14.4)

Year-over-Year Reference (Q4)

MetricQ4 2023Q4 2024YoY Change
Revenue ($USD Millions)$295.4 $200.9 (32.0%)
GAAP Gross Margin (%)34.2% 34.7% +50 bps
Non-GAAP Gross Margin (%)34.4% 35.1% +70 bps
GAAP EPS ($)$(0.02) $(0.24) more negative
Non-GAAP EPS ($)$0.03 $(0.09) down
Adjusted EBITDA ($USD Millions)$3.3 $(14.4) down

Channel/Segment and KPIs

MetricQ2 2024Q3 2024Q4 2024
Retail Revenue ($USD Millions, % of total)$137 (74%) $208 (80%) $150 (74%)
GoPro.com Revenue incl. Subscription ($USD Millions, % of total)$49 (26%) $51 (20%) $51 (26%)
Subscription & Service Revenue ($USD Millions)$26 $27.5 $27
Subscribers (Millions)2.53 2.56 2.52
ARPU Growth YoY (%)+4% +9% +8%
Street ASP ($)$323 $294 $346
Sell-Through Units (000s)>600 n/a~775
Channel Inventory Change (Units)~700k level n/a↓ >170k
Cash & Marketable Securities ($USD Millions)$133 $130 $103

Notes:

  • Q4 GM was ~80 bps below guidance due to USD strength .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Revenue ($USD Millions)Q1 2025n/a$125 ± $10 New
Gross Margin (%)Q1 2025n/a~35% New
Operating Expenses ($USD Millions)Q1 2025n/a~$63 ± $2 New
Non-GAAP EPS ($)Q1 2025n/a~$(0.13) New
Shares (Millions)Q1 2025n/a~155 New
Cash ($USD Millions)Q1 2025n/a~80 New
Operating Expenses ($USD Millions)FY 2025$320 ± $5 (Q2) $250–$260 (Q4) Lowered materially
Gross Margin vs 2024FY 202535–36% (Q3) >100 bps improvement vs 2024 Maintained/clarified
Subscription & Service Revenue ($USD Millions)FY 2025n/a~105 New
Subscribers (Millions)FY 2025n/a~2.4 New
Year-End Cash ($USD Millions)FY 2025~125 at 2024 YE (context) ~50; repay convert debt; $50 ABL available New/Conservative

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 & Q3)Current Period (Q4)Trend
Supply chain & tariffsSupply chain not an issue; diversification ongoing . Added ~6,300 doors; global retail expansion .Tariff announcements expected to have minimal impact due to diversified supply chain; manufacturing outside China .Resilient; improving cost/tariff positioning .
Product roadmap (MAX/360)MAX2 delayed to 2025; 360 revenue ~0 in 2024; expects 5–10% of revenue from 360 in 2025 .Refresh MAX (entry-level 360) now; MAX2 later in 2025; strong software upgrades via Quik .Rebuilding 360 presence ahead of MAX2; near-term momentum .
GP3 SoC/R&DHeavy NRE spend in 2024 to drop ~$20M in 2025; OpEx reductions targeted .GP3 validation completed; positioning for performance leadership .Execution milestones achieved; R&D cadence with lower OpEx .
Subscription economicsARPU +4% (Q2); aggregate retention +7% YoY to 68% (Q2) . ARPU +9% (Q3) .ARPU +8%; retention 69%; attach rate 34% (vs 29% Q4’23); 2025 subs ~2.4M .Strong retention/ARPU; subscriber count dips modestly in 2025 .
Macro/FX & competitionMacro headwinds; China down; Europe softening; competition cited .USD strength cut GM ~80 bps vs guidance; 2025 units/revenue below 2024 .Continued headwinds; managing via cuts and pricing .
Legal/IPITC and court actions to protect patents; defend IP .No new legal updates; continued emphasis on innovation leadership .Ongoing IP defense; focus on roadmap .
Regional trendsEurope strong (Q2), China weak (Q3) .No region-specific detail in Q4; emphasis on supply chain diversification and tariffs .Stabilizing operational footprint; macro watch .

Management Commentary

  • CEO: “We undertook several initiatives to put us back on a path to return to growth and profitability in 2026… reduce operating expenses for 2025 by nearly 30%… pursue improved product diversification” .
  • CEO on 360: “We’ll begin selling a refresh MAX 360-degree camera… ahead of MAX2 later this year… capabilities that will redefine the 360 camera market” .
  • CFO: “In Q4… non-GAAP net loss per share of $0.09 exceeded guidance… aggregate retention rate reached a record 69%” .
  • CFO outlook: “Gross margin improvement of more than 100 bps in 2025… OpEx $250–$260M… subscription & service revenue ~$105M… subscribers ~2.4M” .

Q&A Highlights

  • Subscriber trajectory: Despite stronger retention, 2025 subs guided ~2.4M due to lower units; subscription revenue ~$105M, ARPU improvement offsets some decline .
  • 2025 visibility: Management will guide quarter-to-quarter; FX has impacted ~$50M over 2021–2024; confident in ~35% GM from cost reductions and subscription mix .
  • MAX re-introduction: Refreshing MAX is margin accretive; serves entry-level 360 until MAX2 launches later in 2025 .
  • GP3 timing: Roadmap specifics withheld for competitive reasons; validation completed .
  • Subscription growth levers: Beyond hardware attach, expanding software experiences to drive engagement and conversion; retention improving across cohorts (near 90% by year 4) .

Estimates Context

  • S&P Global consensus estimates for Q4 2024 could not be retrieved at the time of analysis due to provider request limits; as a result, we cannot quantitatively compare reported revenue/EPS to Wall Street consensus for this quarter. Values would be retrieved from S&P Global if available.*

Key Takeaways for Investors

  • Near-term: Expect softer Q1 2025 (revenue $125M ± $10M, GM ~35%); focus on execution of inventory reductions, pricing discipline, and subscription retention to stabilize margins .
  • Cost discipline: Material OpEx reset to $250–$260M in FY25 (from $320M guided in Q2); incremental GM uplift from supply chain, tariffs, subscription mix and product costs .
  • Product catalysts: Refresh MAX in Q1, MAX2 later in 2025, and GP3 validation underpinning differentiation—key triggers for revenue/margin trajectory and narrative re-rating .
  • Subscription resiliency: ARPU/retention strength offsets unit pressure; watch 2025 subscribers ~2.4M and ~$105M subscription revenue for margin contribution .
  • FX/macro: USD strength and macro softness remain headwinds; diversified supply chain mitigates tariff risk, reducing downside to pricing/margins .
  • 2026 setup: Management framing 2026 as return-to-growth/profitability year with broader, diversified roadmap; monitor execution and cadence of launches .
  • Trading lens: Stock likely sensitive to evidence of margin durability at ~35%, cadence of 360/GP3 milestones, and confirmation of OpEx run-rate adherence; upside if MAX2 timing lands and FX/tariff impacts remain contained .