Shares fell 51% in 2016
GoPro stock has been in a downward spiral since last year with a fall of over 50% in 2016. Shares fell by over 12% in December 2016. The trailing-12-month period has been a difficult one for GoPro (GPRO).
In November 2016, the firm recalled approximately 2,500 of its Karma drones purchased since October 23, 2016. GoPro stated that the drones had to be recalled because a few units “lost power during operation.” Karma was launched in September 2016 and was expected to drive GoPro’s revenue in the holiday season of 2016. GoPro also faced several issues with channel partners related to the retail pricing of its drone.
Layoffs and restructuring
Last month, GoPro stated that it has embarked on a restructuring process that will eliminate 15% of its current workforce, or ~200 positions. The move comes as GoPro has struggled with its attempts to expand outside its action camera mainstay.
The company has seen its losses swell in recent quarters as it attempted to expand into the media and drone businesses. The layoffs, the closure of its entertainment unit, and other restructuring measures are expected to eliminate ~$650 million from GoPro’s adjusted operating expenses in 2017.