GoPro hunting a buyer as sale tipped

GoPro hunting a buyer as sale tipped

The disappointing outlook sent shares plummeting almost a third to an all-time low of $5.04 in morning trading Monday.

Shares of GoPro were down 19 percent in midday trading Monday, after the camera maker said it was laying off about 20 percent of its workforce and lowering guidance after a weak holiday season. GoPro also cut some 200 positions in November of 2016. Following Monday's windfall, GoPro short sellers have now made a total of $42.5 million betting against the company this year.

The company said it saw lower than expected revenue in the fourth quarter of 2017. The selling did subside somewhat later in the session, however, on a CNBC report that the company had hired JPMorgan to oversee a potential sale.

The company slashed prices of the drones as well as its Hero line of cameras over the holiday period.

In a particularly surprising move, it also announced that it would be exiting the drone business.

Instagram to add 'Recommended' posts to feed
However, a spokesperson did confirm that the recommended posts will only appear once users have gone through their own feed. Instagram will begin to show users "recommended" posts from accounts that they don't follow in a bid to bolster engagement.

"Despite significant marketing support, we found consumers were reluctant to purchase HERO5 Black at the same price it launched at one year earlier", said Woodman, adding that the company "is committed to turning our business around in 2018". "We entered the new year with strong sell-through and are excited with our hardware and software roadmap".

Due to the drone-market exit and weak demand, GoPro plans to lay off hundreds of employees.

Morgan Stanley said in a research note earlier Monday that the price cut for the Hero6 camera would make earnings growth hard in fiscal 2018.

He hoped the actions would return the firm to profitability in the second half of 2018. Later in the day, GoPro CEO Nick Woodman told Bloomberg the company would be open to sale, but isn't actively shopping itself.

It's unclear if there is an interested buyer for the company.
Its holiday results were downright very bad, and its disastrous attempt to enter the drone market is the kind of mistake that well-run companies seldom make.

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