Delayed Karma: GoPro pushes drone launch to winter

Reuters News
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Posted: May 05, 2016 4:39 PM

By Rishika S

(Reuters) - Wearable action camera GoPro Inc <GPRO.O> said on Thursday it would delay the launch of its drone, Karma, until the holiday shopping season.

The company's shares were down 4.3 percent at $10.25 in after-hours trading.

The drone, which was expected to release in the first half of the year, was seen by analysts as key in turning around the company's fortunes.

"The biggest surprise is that they delayed Karma," Wedbush Securities analyst Michael Pachter said.

"They said they wanted to work on the features... they did not explain the delay and why they did not notice it three months ago," he said.

GoPro's helmet-and body-mounted cameras are popular with surfers, skydivers and other adventure sports enthusiasts.

But the company is facing pressure from improved video-shooting abilities of smartphones that are likely affecting sales of traditional cameras.

The company's revenue halved to $183.5 million in first quarter ended March 31.

GoPro said it shipped 701,000 cameras in the quarter, a 47.8 percent drop from a year earlier.

The company posted a net loss of $107.4 million, or 78 cents per share, compared with a profit of $16.8 million, or 11 cents per share, a year earlier.

GoPro said it took a charge of about $8 million, largely due to the phasing out of some Hero products.

The company launched its Hero4 Session in July for $399.99, but slashed its price by $100 two months later due to weaker-than-expected demand.

Excluding items, the company lost 63 cents per share, bigger than the 60 cents analysts had expected.

Up to Thursday's close, GoPro's shares had fallen 40.5 percent this year.

(Reporting by Rishika Sadam and Anya George Tharakan in Bengaluru; Editing by Sriraj Kalluvila)