uploads/2016/09/7-7.png

Is a Rosy Picture in Store for GoPro for the Rest of 2016?

By

Updated

Expected revenue in fiscal 2016

GoPro (GPRO) expects to post revenue between ~$1.4 billion–$1.5 billion in fiscal 2016. The company expects revenue growth in 3Q16 and 4Q16, with a gross margin of ~40%. GoPro noted that it expects its operating expenses to “grow modestly” in the second half of 2016. The company expects to return to profitability in the last quarter of fiscal 2016.

Sales and marketing will drive operating expenses in the last two quarters of 2016 as GoPro is expected to launch two major products in that timeframe. However, driven by strong demand of GoPro products, its channel inventory has reduced substantially.

The CFO of GoPro, Brian McGee, stated, “We now have a simple product line, a clean retail channel and clear indications of strong consumer demand. We believe all of these factors put GoPro in a very favorable position for launching new products later this year.”

Article continues below advertisement

What do analysts expect from GoPro in 2016?

Analysts estimate that GoPro (GPRO) will post revenue of $317.3 million in 3Q16 and $671.6 million in 4Q16. For fiscal 2016, analysts expect GoPro to post revenue of ~$1.4 billion and for fiscal 2017, they expect the company to post revenue of ~$1.7 billion.

If GoPro meets these analyst revenue estimates, it could still mean a year-over-year decrease of 20.7% and 14.2% in 3Q16 and fiscal 2016, respectively, as well as a year-over-year rise of 53.8% and 21.9% in 4Q16 and fiscal 2017, respectively.

Advertisement

More From Market Realist