GoPro(US:GPRO)2025-11-06 21:59Financial Performance - GoPro reported Q3 2025 revenue of $162.9 million, a decrease of 37% compared to $258.9 million in Q3 2024[19] - The gross profit for Q3 2025 was $57.2 million, down from $91.8 million in Q3 2024, resulting in a gross margin of approximately 35%[19] - Operating loss for Q3 2025 was $15.9 million, compared to a loss of $8.0 million in Q3 2024[19] - Net loss for the nine months ended September 30, 2025, was $84.4 million, significantly improved from a net loss of $395.1 million in the same period of 2024[21] - Revenue for the nine months ended September 30, 2025, was $449.9 million, a 25.1% decline from $600.6 million in the same period of 2024[32] - The company incurred operating losses of $75.1 million and operating cash outflows of $36.3 million during the nine months ended September 30, 2025[32] - The company recognized an $18.6 million goodwill impairment charge in the first quarter of 2025 due to a decline in market capitalization[44] - The company reported a net loss of $21.252 million for the three months ended September 30, 2025, compared to a net loss of $8.211 million for the same period in 2024[136] - Basic and diluted net loss per share for the nine months ended September 30, 2025, was $(0.53), compared to $(2.59) for the same period in 2024[136] - The net loss for Q3 2025 was $21.3 million, a 29% increase from Q2 2025 and a 159% increase from Q3 2024[196] Cash and Liquidity - Cash and cash equivalents at the end of Q3 2025 totaled $58.4 million, down from $102.8 million at the end of 2024[15] - As of September 30, 2025, the company had cash and cash equivalents of $152.8 million and an accumulated deficit of $766.0 million[32] - The company fully drew on its 2021 Credit Agreement as of September 30, 2025[35] - The financial covenants require the Company to maintain liquidity of at least $40.0 million and not to have EBITDA of less than $10.0 million for the fiscal quarter ending December 31, 2025[103] Debt and Liabilities - Total current liabilities increased to $379.1 million as of September 30, 2025, compared to $356.3 million at the end of 2024[15] - The company reported a significant increase in short-term debt, rising to $138.5 million from $93.2 million at the end of 2024[15] - The outstanding principal under the 2025 Term Loan was $50.0 million, with a net carrying amount of $43.9 million recorded as long-term debt[105] - The Company issued $143.8 million principal amount of Convertible Senior Notes due 2025 and plans to repay them in cash by November 15, 2025[74] Research and Development - Research and development expenses for Q3 2025 were $34.6 million, a decrease from $44.3 million in Q3 2024[19] - The company plans to lower research and development costs and manage working capital effectively to maintain liquidity[36] Inventory and Assets - The company experienced a decline in inventory levels, which fell to $84.1 million from $120.7 million at the end of 2024[15] - GoPro's total assets decreased to $538.6 million as of September 30, 2025, down from $543.7 million at the end of 2024[15] - Total inventory decreased to $84.1 million as of September 30, 2025, from $120.7 million as of December 31, 2024, representing a decline of approximately 30%[79] Revenue Streams - As of September 30, 2025, the Company's subscription and service revenue was $26.6 million, representing 16.3% of total revenue for the three months ended September 30, 2025, compared to $27.5 million, or 10.6%, for the same period in 2024[53] - Subscription and service revenue for the nine months ended September 30, 2025, was $79.7 million, or 17.7% of total revenue, compared to $79.7 million, or 13.3%, for the same period in 2024[53] - Revenue from the U.S. accounted for 48.7% of total revenue in the nine months ended September 30, 2025, compared to 34.0% in the same period of 2024[193] Product Developments - The next generation 360-camera, MAX2, was introduced in September 2025, following delays[32] - The company began shipping the True 8-K MAX2 camera in September 2025, featuring 10-bit color video in 8K at 30 FPS and 29-megapixel resolution[185] - The HERO13 Black camera, launched in September 2024, includes features such as HyperSmooth 6.0 image stabilization and 5.3K video at 60 FPS[189] Stock and Compensation - The Company issued an aggregate of 11,076,968 warrants to purchase shares of its common stock at an exercise price of $0.75, initially valued at $3.2 million[107] - Total stock-based compensation expense for the nine months ended September 30, 2025, was $15.149 million, a decrease from $23.933 million in the same period in 2024[134] - As of September 30, 2025, total unearned stock-based compensation was $17.7 million, expected to be recognized over a weighted average period of 1.99 years[135] Legal and Compliance - The Company’s legal proceedings resulted in a jury awarding $8.2 million in past damages related to certain legacy cameras, but none of the products launched from 2020 to 2024 were found to infringe[160] - As of September 30, 2025, the Company was in compliance with all financial covenants contained in the 2021 Credit Agreement[98]