GoPro, already a beloved camera brand, just couldn’t take flight. The GoPro vision – a little box you can attach to the wing of a plane or your ski helmet and catch unparalleled views of the world – is cloudy now on news that trading halted this morning due to low performance attributed to price slashing, layoffs, and the closing of the company’s nascent drone division.
“As we noted in our November earnings call, at the start of the holiday quarter we saw soft demand for our HERO5 Black camera,” said GoPro founder and CEO Nicholas Woodman in a release. “Despite significant marketing support, we found consumers were reluctant to purchase HERO5 Black at the same price it launched at one year earlier. Our December 10 holiday price reduction provided a sharp increase in sell-through.”
The company ended the fourth quarter with $247 million in cash, up $50 million from the pre-holiday Q3 2017 quarter.
What is truly happening here is the heat death of another hardware giant. GoPro is, however, unique. There is no comparable product that offers the same functionality which is one of the reasons it’s held on so long. You can’t strap a cellphone to your chest and get the same footage nor can you do safely do videography tricks like mounting a few GoPros on a chase car to film an action scene. That said, the action camera market is now a commodity and, though none of the pretenders offer anything remotely like GoPro’s quality, the price from Alibaba and Amazon is right.
I’ve called the deaths of multiple hardware products in the past and I’ve always had my gimlet eye on GoPro. They grew big fast, IPOed, and then tried to do business in a changed world. Like Flip before them, they became a fad then a tool then a commodity finally leading to a battle that they were never born to win.
When your company is tied up in one popular product – Palm, Fitbit, and Makerbot come to mind – competition heats up quickly. Other hardware makers start gunning for you and, before you know it, the dinosaurs (Apple, HP, Samsung) come along to eat you.
My call? GoPro is bought by DJI or Samsung this year, runs for a brief moment as a standalone product, and then is folded into the company proper. It’s a respectful end to a wonderful product whose golden days are past.
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