GoPro cuts 270 jobs, shares surge

GoPro gave its investors something to be excited about, as the sport-camera maker’s shares climbed more than 15 percent Thursday morning. And all it took was the company saying it would cut 270 jobs.

Well, that, and it expects its first-quarter sales to come in at the high end of its estimated range of $190 million to $210 million.

GoPro’s stock got up to as high as $8.48 in the wake of the San Mateo company’s announcements, which came after the stock markets closed Wednesday. GoPro’s advance was a dubious achievement, as the company’s shares on Wednesday fell to an all-time low of $7.14.

But a gain is a gain. And for GoPro, it needed to do something to give its investors some faith in where it’s going, after more than a year of product delays, product recalls, disappointing results and layoffs.

The latest round of job cuts are aimed at getting GoPro’s expenses in line. Chief Executive Nick Woodman said as much in a statement announcing the layoffs.

“Importantly, expense reductions preserve our product roadmap,” Woodman said.

Those expenses will be even less than what GoPro had already targeted for the year. GoPro now estimates its operating expenses will be $585 million, down from an earlier forecast of $650 million. GoPro set that target last fall when it trimmed more than 200 jobs and closed down its entertainment business to focus more on products like its Hero line of cameras and its new Karma drone. The drone, which first came out last fall, but was recalled after less than three weeks due to malfunctions, is set now for a full rollout in April.

Just 10 days ago, Goldman Sachs analyst Simona Jankowski cut her rating on GoPro’s stocks to sell from neutral, saying that the company continues to “struggle fundamentally.”

Photo: GoPro CEO Nick Woodman at his company’s public stock debut at the Nasdaq MarketSite in New York, Thursday, June 26, 2014. On Thursday, GoPro said it expects first-quarter sales to be at the high end of its estimates and that it will cut another 270 jobs. (Seth Wenig/AP)

 

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