GoPro reported a loss in the first quarter as sales were down 19 percent year-over-year but revenue topped guidance with subscribers expanding 36 percent year-over-year.

“In Q1 2023, GoPro exceeded expectations thanks to better-than-expected demand for our products and subscription services,” said Nicholas Woodman, GoPro’s founder and CEO, in a statement “Capitalizing on our momentum, effective today, we’re implementing an updated go-to-market strategy that restores our product pricing to pre-pandemic levels, which we believe will accelerate growth in units, subscribers, revenue and earnings.”

“Our pandemic strategy allowed us to address supply chain and retail channel constraints while driving ASPs, increasing profitability and rapidly growing our subscriber base to more than two million subscribers,” said Brian McGee, GoPro’s CFO and COO. “In our post-pandemic world, we are now implementing an updated go-to-market strategy that we believe will result in revenue and earnings growth that we will use to drive innovation and significantly increase share buybacks.”

Q1 2023 Financial Results

  • Revenue was $175 million, down 19 percent year-over-year and ahead of the midpoint of its prior Q1 guidance.
  • GoPro subscriber count ended Q1 at approximately 2.36 million, up 36 percent year-over-year.
  • GoPro.com revenue, including subscription and service revenue, was up 7 percent year-over-year at $95 million, or 54 percent of total revenue. Revenue from the retail channel was $80 million, down 38 percent year-over-year.
  • Subscription and service revenue increased 24 percent year-over-year to $23 million.
  • Attach rate via our app from cameras purchased at retail was approximately 50 percent in the quarter, up from 39 percent a year ago, a 23 percent improvement.
  • GAAP net loss was $30 million, or 19 cents per share, down from net income of $6 million, or 4 cents per share in the prior year period. Non-GAAP net loss was $29 million, or 18 cents per share, down from non-GAAP net income of $15 million, or 9 cents per share, in the prior year period.
  • GAAP and non-GAAP gross margin was 30.0 percent and 30.3 percent, respectively, and as estimated on a constant- currency basis was 32.9 percent and 33.1 percent, respectively. This compares to GAAP and non-GAAP gross margins of 41.8 percent and 42.0 percent, respectively, in the prior year period.
  • Adjusted EBITDA was negative $28 million. This compares to a positive $21 million, or 10 percent of revenue, in the prior year period. The difference is primarily related to our new product pricing strategy which resulted in $24 million in price protection charges as well as a decline in revenue on a year-over-year basis.
  • Cameras with retail prices at or above $400 represented 87 percent of Q1 2023 camera revenue.
  • Q1 2023 Street ASP was $378, a 9 percent decrease year-over-year, and $394 as estimated on a constant currency basis, down 5 percent year-over-year.
  • Days’ sales outstanding was 29 days or flat compared to the prior year period.

Recent Business Highlights
In Q1 2023, GoPro bought back $5 million in stock and reported it plans to continue executing on its stock repurchase plan in 2023.