On the heels of a company restructuring earlier this year and in November 2016 that cut 300 jobs, GoPro announced Wednesday that it will stay on track with its 2017 non-GAAP profitability plan by cutting operating expenses and once again reducing 270 staff positions (both current headcount and existing open jobs).
While the San Mateo, Calif. based company isn’t expected to release Q1 earnings until the end of April 2017, the preemptive cuts are a reflection of Founder and CEO Nick Woodman’s vision to keep 2017 financials on track.
“We’re determined that GoPro’s financial performance match the strength of our products and brand. Importantly, expense reductions preserve our product roadmap and we are tracking to full-year non-GAAP profitability in 2017,” said Woodman in a press release.
This round of restructuring will cut operating costs for the company by more than $200 million, year over year, and position the company for new growth in hardware, software, and in International markets, according to GoPro.
Since the Karma Drone recall in November, less than 2 months after its initial debut, GoPro has been clawing back missed revenue opportunities. Although it was reintroduced in February, the Karma’s absence gave market competitors a clear advantage, according to analysts’ speculation.
Upon contacting GoPro, the company declined to provide any further comments besides what was contained in the official press statement released Wednesday:
GoPro, Inc. (NASDAQ: GPRO) announced that it affirms 2017 first quarter revenue to be in the upper end of its previously announced $190-210 million range and repeated its target of full-year non-GAAP profitability. The Company also announced a restructuring that reduces full-year GAAP operating expenses to below $585 million and non-GAAP operating expenses to below $495 million without impacting the Company’s roadmap for new hardware and software products.
GoPro will release its financial results for its first quarter, ended March 31, 2017, after the market closes on April 27, 2017.
The reduction in operating expenses is achieved with a combination of cuts to program costs, headcount and open positions, totaling the elimination of approximately 270 positions. GoPro estimates that it will incur total aggregate charges of up to $10 million for the restructuring, which are primarily cash expenditures related to severance costs. The Company expects to recognize the restructuring charges in the first quarter of 2017.
“Today we are updating revenue guidance for the first quarter of 2017. We now expect to deliver revenue in the upper end of our guidance range of between $190 million and $210 million,” said GoPro Chief Financial Officer, Brian McGee. “We currently have no need to draw on our credit facility and we expect to be EBITDA positive for full-year 2017.”
Read the press release from GoPro.