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GoPro cuts 20 per cent of jobs, exits drone group

09 January 2018

The company's stock (GPRO) plunged almost 30 percent in response to the announcement.

Shares of GoPro plunged by about 25 per cent on Monday (Jan 8) after it announced it was slashing its workforce and exiting the drone market following disappointing holiday-season sales.

In a trading statement, GoPro said its Karma drone would be the last one it would make. Following Monday's windfall, GoPro short sellers have now made a total of $42.5 million betting against the company this year. "There's significant demand for GoPro at the right price", Woodman said.

However, prices rebounded sharply following a report from CNBC that the company has hired JPMorgan to find a buyer.

GoPro will discontinue its Karma drone and exit the category. On January 7, GoPro lowered the price of its premium model, HERO6 Black from Dollars 499 to USD 399. GoPro will sell its remaining Karma drone inventory and continue to provide service and support to existing owners but once the current inventory is gone, it'll be game over for the aerial division.

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In its statement today, GoPro also cited the hard regulatory regimes in the USA and Europe as the reason why it doesn't think the drone market will be lucrative in the long term. "We entered the new year with strong sell-through and are excited with our hardware and software roadmap".

In the years since its 2014 initial public offering, formerly high-flying GoPro has sharply narrowed its vision and held several rounds of layoffs.

He hoped the actions would return the firm to profitability in the second half of 2018.

"If there are opportunities for us to scale awareness of GoPro globally by being part of a bigger company, that's something that we would entertain", CEO Nick Woodman told CNBC Monday morning. But GoPro saw its sales slump in 2016 as companies began flooding the market with cheaper, sometimes, comparable alternatives to the GoPro.

GoPro cuts 20 per cent of jobs, exits drone group