GoPro makes its first profit since 2017 thanks to Hero 7

The beautiful holiday season of GoPro's new Hero 7 camera line has helped the camera maker make its first quarterly profit since the third quarter of 2017, the company said on Wednesday. GoPro generated revenue of $ 377 million in the fourth quarter of last year and made a profit of $ 32 million.

This is the second time GoPro has made profits since the third quarter of 2015, before the company's unfortunate attempt to enter the drone market.

The company also announced plans to transfer its US-based camera production from China to Guadalajara, Mexico in the second quarter of this year. The company announced in December that it was carrying production due to the ongoing trade war with China.

"We are encouraged by this momentum," said Nick Woodman, CEO of GoPro, during a call to investors. "The GoPro brand has never been stronger, our product has never been better and we are ready for the coming year."

The Hero 7 Black was announced last September. Although closely aligned with the design of its two predecessors, the Hero 5 and Hero 6 Black, the company's latest flagship product, offered a number of internal enhancements and new features.

GoPro had previously stated that the Hero 7 Black was the company's top-selling camera, and that momentum has lasted during the 2018 holiday season. Overall camera sales have increased by 20% in the fourth quarter of 2018 compared to the previous year. For the full year, GoPro's camera sales increased 9% over 2017 and total revenue reached $ 1.15 billion. GoPro recorded a $ 94 million loss for the year, nearly half of the company's $ 163 million loss in 2017.

The camera company also continued to increase the number of customers for its $ 5 per month cloud storage subscription service, called GoPro Plus. To date, there are 199,000 paid subscribers, according to GoPro, up from 185,000 at the end of the third quarter of last year. GoPro recently announced the removal of all storage caps for Plus in order to increase this number of subscriptions.

GoPro started 2018 in a difficult situation. The company had a holiday season in 2017 that had been worse than expected. Then GoPro turned around and canceled his Karma drone, resulting in the dismissal of a few hundred people. At CES 2018, Woodman was even talking about exploring a sale of the company.

But the company's course corrections seem to have worked. GoPro has reduced its operating expenses to just under $ 400 million for the year and is now heading into a new year with a smaller workforce of 891 employees (the company had close to 1,300 employees). in 2017 even after the previous series of lay-offs).

"It's great to be in 2019 with a steady dynamic and steady base," said Woodman at the investor call Wednesday. This "gives us the ability to constructively build on the momentum we have in the sector, and to look for ways to grow our business, and to devote our time and energy frankly to that, as opposed to the fight against fires, had to do in the past years. "