SAN MATEO, CA - GoPro, Inc. (NASDAQ:GPRO) disclosed on Monday a restructuring plan aimed at reducing operating expenses, which includes a workforce reduction of approximately 15%. The announcement follows the company's intent, shared during the August 6 second quarter earnings call, to decrease fiscal 2024 expenses to around $320 million, a $50 million reduction from projected figures.
The plan, approved by the Board of Directors, is expected to be substantially completed by the end of 2024. The reduction will affect about 15% of the company's full-time employees from the ending second quarter headcount of 925. This initiative is part of GoPro's efforts to achieve a leaner operational structure in fiscal 2025.
GoPro anticipates an estimated aggregate charge of $5 million to $7 million due to the restructuring, with cash expenditures of approximately $1 million in the third quarter and between $4 million to $6 million in the fourth quarter of 2024. These estimates are subject to change based on various assumptions, including local legal requirements.
The bulk of the restructuring and related charges are expected to be recognized in the fourth quarter of the fiscal year ending December 31, 2024. The company cautions that these forward-looking statements involve risks and uncertainties, and actual results could materially differ.
This strategic move comes as GoPro navigates cost reduction efforts against a backdrop of broader industry challenges. The company's latest SEC filing provides the basis for these insights, reflecting its commitment to transparency and regulatory compliance. As GoPro implements its restructuring plan, stakeholders are closely monitoring the impact on its operational and financial performance.
In other recent news, GoPro Inc. has been in the spotlight following its Q2 2024 earnings call and a series of discussions with Oppenheimer analysts. The company reported a Q2 revenue of $186 million, selling over 600,000 units, and is now focusing on achieving profitability by 2025. This strategy includes new product launches such as the HERO13 Black and a new entry-level HERO camera, as well as cost reductions.
Analysts at Oppenheimer, following meetings with GoPro's top executives, have maintained a Perform rating on the company's stock. They highlighted GoPro's plans to innovate and penetrate adjacent markets with specialized product offerings. However, they also expressed concerns about potential macroeconomic pressures and challenges in executing the company's plans.
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