Camera making company, GoPro’s share price tumbled on Monday after disappointing Q4 results and a litany of troubles including exiting the drone business and laying off 250 of its employees.
NASDAQ-listed company was down close to -20% at 11:52 EST after dropping -32% at market open.
The company in a statement announcing preliminary results said its traditional camera did not sell well due to soft demand during the holiday season.
It expects revenue of $340m for the fourth quarter which includes a negative impacts of around $80m cutting the price on its HERO5 Black, HERO6 newer model camera and the Karma drone. which it will now stop selling.
Falling from the sky
The Karma drone which was launched in 2016 had been beset by issues including customers complaining of losing control and that the devices fell from the sky and regulations requiring registry of drones.
This resulted in a recall of the drone which missed the holiday period in 2016. It also faced an increasingly competitive marketplace and pressure from leading Chinese drone maker DJI.
The company stated in a press release that “Although Karma reached the #2 market position in its price band in 2017, the product faces margin challenges in an extremely competitive aerial market.”
Adding, ”Furthermore, a hostile regulatory environment in Europe and the United States will likely reduce the total addressable market in the years ahead."
The company has said it will cuts its workforce from 1,254 to under 1,000. Restructuring charges of $33m will be taken as a result of severance costs and its CEO Nicholas Woodman’s compensation is slashed to $1 from base pay of $800,000.