GoPro to cut 15 percent of workforce, close entertainment unit

Following the announcement, GoPro shares climbed more than 4 per cent in pre-market trading.

The company estimates it will incur as much as $33 million in restructuring costs in the fourth quarter. On Black Friday, GoPro’s camera unit sales grew 35 percent compared to data from past year. That flagship action camera has been the best-selling digital imaging device since the October launch, according to the NPD Group.

Action camera-maker GoPro has announced to cut 200 jobs or 15% of its workforce, as part of its restructuring efforts to revive its business.

“We are investing to scale GoPro as a media entity and develop new revenue opportunities by increasing production of GoPro originally produced content while simultaneously increasing the aggregation and redistribution of our customers” “best of’ [user generated content]”, the company said in its prospectus. When the news about the GoPro Karma recall hit the stands, customers were naturally anxious especially those GoPro lovers. Despite lacking the ongoing sales growth that the company has been hoping for, there was plenty of hype surrounding the company’s partnership with RedBull that was announced back in May of this year.

By closing the entertainment division, GoPro is focusing on its core mission – making hardware. The soon-to-be former President was once an executive for both Microsoft (NASDAQ:MSFT) and Skype. “Its clear consumers are excited about these new features”. But Nick Woodman, the surfer-turned-entrepreneur who built the company into a darling of the extreme-sports set, said the company has sharply narrowed its focus. He said: “My time at GoPro has been an incredible experience”, Bates said. Accordingly, the company will only lose around $2 million in revenues, as well another million in expenses to effect the recall for GoPro Karma.

GoPro said on Wednesday it would cut about 15% of its workforce as the company restructures its once fast-growing action camera business.

Even if Karma´s technical problems are fixed, the new edition is not going to be available for Christmas shopping, which represents a problem for the company. Since the Company finds non-GAAP financial measures to be useful, it believes that investors benefit from seeing results reviewed by management in addition to seeing GAAP results.