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Understanding GoPro’s Important Metrics

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Customer repurchases and satisfaction

According to GoPro’s (GPRO) internal data, approximately 30% of customers who purchased the HERO6 also owned a HERO4 or HERO5. This figure might be higher when all other GoPro models are included. NPD’s Retail Tracking Service has estimated GoPro’s Karma drone to have a share of 24% in the United States (SPY) for all drones priced above $1,000 at the end of 3Q17.

GoPro is maintaining a constrained approach to distribution and in-store merchandising with regards to the Karma due to the product’s lower margins. NPD and GfK have estimated a rise of 2% YoY for GoPro’s unit sell-through in 3Q17. Channel inventory continued to improve in 3Q17, and the company exited the quarter with nine weeks of inventory compared to ten weeks in 2Q17 and 11 weeks in 1Q17. GoPro expects channel inventory to fall significantly in 4Q17.

GoPro products are available in a range of retail outlets, including Best Buy (BBY), Walmart (WMT), Target (TGT), and online platforms such as Amazon (AMZN) and JD.com.

Growth in the international business

One of GoPro’s key priorities is to grow its international business. Revenue from EMEA (Europe, the Middle East, and Africa) and APAC (Asia-Pacific) accounted for 29% and 21% of the company’s revenue in 3Q17, respectively. While revenue from APAC rose 153% YoY, revenue from EMEA rose 26% YoY in 3Q17.

Japan led revenue growth in the APAC region for GoPro, and it’s now an important market for the firm. China (FXI) is also a top-ten market for GoPro, and unit sell-through rose 25% YoY in the country in 3Q17. GoPro has also predicted incremental sales in China during the Single’s Day event on November 11, 2017.

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