It’s been an interesting couple of months for GoPro. In September the action camera giant released its highly anticipated Hero5 cameras and Karma Drone.
Then, 16 days after the Karma Drones went on sale, they were recalled for “intermittent power failure during operation,” which literally caused the units to fall out of the sky. This was also closely followed by the release of the DJI Mavic Pro drone, which is similarly priced and according to the spec sheet flies farther, higher, longer, is smaller and offers autonomous “follow me flight” and object avoidance technology.
Now, the California-based tech brand has announced a company-wide restructure where it will be closing its entertainment division and reducing its workforce by 15 percent, letting approximately 200 full-time employees go.
This comes as the result of GoPro’s company stock losing half its value since the beginning of the year. In early November the stock dropped another 20 percent after the brand said its third-quarter sales were down 40 percent from the same time last year. GoPro is also facing a lawsuit that alleges the company misled investors about demand for the Karma. Amongst all these problems, GoPro president Tony Bates will be leaving the company at the end of the year.
This announcement came in a press release touting the Hero5’s success with Black Friday camera sales up more than 35 percent year-on-year at leading US retailers. GoPro reported that Thanksgiving through Cyber Monday sales of camera units at GoPro.com were similarly strong — up approximately 33 percent year-on-year.
GoPro is aiming to reduce operating costs by $650 million in 2017 through the reduction in staff and closing its video-licensing division. These actions will cost the brand about $33 million, with most of the cost being in severance payments.
In spite of these massive cuts , Rick Loughery, Global PR Director for GoPro told BikeRadar it won’t affect its involvement in cycling.
“We are continuing our sponsorship with Tour de France,” Loughery said. “While I can’t comment on what the media outputs will be this year — I do know our partners have produced some amazing GoPro videos from these events and I think you’ll continue to see great GoPro videos in the world of cycling yet to come.”