GoPro shares plunge 28% on revenue forecast
- 14 January 2016
- From the section Business
Shares of GoPro plunged as much as 28% in after-hours trading after the wearable camera maker announced revenue forecasts below expectations.
The firm forecast revenue of $435m (£302m) in the fourth quarter, well below market expectations of $512m.
It also said a 7% cut to its workforce of 1,500 employees would cost up to $10m in restructuring costs.
Disappointing sales of its action cameras over the holiday season were a major factor behind the lower forecast.
The Silicon Valley-based company said its sales were also hit by a decision to cut the price of its Hero4 Session camera.
"Fourth-quarter revenue includes a $21m reduction for price protection related charges resulting from the Hero4 Session repricing in December," the firm said in a statement on Wednesday.
In October, GoPro had said there was weaker-than-expected demand for the device because of its initial high price.
The company has also been facing stiff competition from cheaper devices from Chinese rivals such as Xiaomi.
Its current revenue forecast is more than 30% lower than that in the fourth quarter of 2014.
Its New York-listed shares fell to $10.50 in extended trading, which is less than half its initial public offering (IPO) price of $24 in 2014.