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Will GoPro’s New Products Act as a “Game Changer”

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Dec. 7 2015, Updated 10:07 a.m. ET

Quadcopter and Flagship camera

GoPro (GPRO) manufactures action cameras. The revenue for its HERO4 Session missed the expectations due to poor pricing and marketing. This caused the company’s price to fall by 73% YoY (year-over-year). This year, the company doesn’t have any new products to offer sports enthusiasts and adventure seekers during the holiday season. In 2016, GoPro will come up with the new Quadcopter and Flagship camera to boost its revenue growth.

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GoPro claims that its new Quadcopter will capture videos in a more stabilized manner. It will eliminate the users need to edit the videos. GoPro’s close competitor in the drone market is DJI Innovations. It has covered most of the drone market across the world. In 2013, DJI launched its first Phantom drone. It was popular among consumers. It’s expecting the revenue to reach $1 billion.

How can DJI impact GoPro?

Earlier, DJI used a mounted camera over its Phantom drone. The camera was outsourced from GoPro. This year, the company used an integrated camera. It was produced in-house. DJI introduced Manifold. It’s a Linux computer for a drone. It allows real-time monitoring, data analysis, and image recognition capability.

Intel also developed a cheap design to integrate IoT (Internet of Things) modules and a RealSense camera into drones to ensure seamless connectivity while avoiding collisions. In contrast, Qualcomm is integrating its Snapdragon chips with its depth-sensing cameras.

Analysts expect GoPro to boost its revenue by launching new products in fiscal 2016. It estimated that it will generate $2 billion in revenue. Even if it manages to pull $200 million in revenue from the drone, it will help the company offset the slower growth this year. However, if the FAA (Federal Aviation Administration) develops strict regulations to limit or discontinue drones, then it will impact the company’s demand and growth.

The iShares US Consumer Goods ETF (IYK) is a portfolio of 118 stocks. Fossil Group (FOSL), General Motor (GM), Activision Blizzard (ATVI), and GoPro account for 0.11%, 2.4%, 0.80%, and 0.09% of IYK, respectively.

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