GoPro Reviewing Possible Sale After Receiving Inquiries
The company says it received inquiries related to mergers and acquisitions after it made efforts to expand into the defense and aerospace industries
- GoPro is reviewing a possible sale or merger after receiving multiple unsolicited inquiries.
- GoPro’s board engaged a financial adviser to help conduct the strategic review process.
- The company plans to cut 23% of its workforce and faces ongoing macroeconomic challenges.
GoPro GPRO -3.65%decrease; red down pointing triangle is reviewing a possible sale or merger after receiving multiple unsolicited inquiries.
The wearable camera maker said Monday it received inquiries related to mergers and acquisitions after it made efforts to expand into the defense and aerospace industries.
Shares gained 10% to $1.45 in after-hours trading.
GoPro’s board has since engaged a financial adviser to help conduct a strategic review, which will evaluate various options including a possible sale or merger.
The company engaged defense consulting firm Oliver Wyman in April. They are helping to assess potential new market segments for GoPro, as well as strategies for diving into the imaging and unmanned industries.
“Q1 and the weeks since have been a pivotal period for GoPro,” Chief Executive Nicholas Woodman said. “Our exploration of defense, aerospace and strategic M&A opportunities reflects our belief that there is significant unrealized value in GoPro’s technology, IP and brand.”
Woodman, who owns a large chunk of voting shares, told analysts during Monday’s earnings call that he was supportive of the strategic review.
GoPro separately recorded a wider loss and a drop in sales during the first quarter.
For the first quarter, the company posted a loss of $80.8 million, or 50 cents a share, compared with $46.7 million, or 30 cents a share, a year earlier. Stripping out certain one-time items, the adjusted per-share loss was 35 cents.
Revenue slid 26% to $99.1 million. Sales from GoPro’s retail channel fell 35%. Subscription and service revenue was roughly flat, while the number of subscribers fell 8%.
GoPro withdrew its guidance and said it won’t provide an outlook while conducting the strategic review.
In April, GoPro shared plans to cut 23% of its workforce as part of a restructuring strategy to reduce costs. Macroeconomic challenges, including high memory costs and tariffs, continue to weigh on the company.