San Mateo, CA – GoPro, Inc., the renowned action camera manufacturer, has unveiled a significant restructuring plan aimed at reducing operating expenses and improving financial efficiency. This strategic move includes a 15% reduction in its workforce, impacting approximately 139 employees.
The restructuring plan, approved by GoPro’s board of directors on August 19, 2024, is part of the company’s broader effort to streamline operations and achieve a targeted reduction in operating expenses by around $50 million for fiscal 2025. The company anticipates incurring restructuring charges between $5 million and $7 million, with the majority of these costs expected to be recognized in the fourth quarter of 2024.
GoPro’s recent financial performance has highlighted the need for cost-cutting measures. In the second quarter of 2024, the company reported a revenue of $186 million, marking a 22.7% decline from the previous year. Operating expenses increased by 5% to $103 million, and the net loss expanded to $47.82 million, up from $17.21 million in the same quarter of 2023.
The company has faced challenges such as muted consumer spending, macroeconomic concerns, and stiff competition. Delays in product launches are also expected to impact revenues by $100 million in 2024.
GoPro’s restructuring plan aims to reduce operating expenses to approximately $320 million (+/- $5 million) for fiscal 2025. The company is focusing on enhancing business efficiencies and investing in key growth areas to navigate the competitive landscape and improve its financial health.
Following the announcement, GoPro’s stock saw a slight increase of 1.5%, indicating a positive reception from investors who view the cost-saving initiative as a necessary step towards stabilizing the company’s finances.
GoPro’s restructuring plan marks a pivotal moment for the company as it seeks to adapt to market challenges and position itself for future growth. The reduction in workforce and operating expenses is expected to provide the financial flexibility needed to navigate the evolving market dynamics and continue delivering innovative products to its customers.
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