Can GoPro Inc. (NASDAQ: GPRO) Survive This Onslaught?


GoPro Inc (NASDAQ: GPRO) is set to launch its drone called Karma on Sept. 19. The company is also widely expected to use event to unveil its next-generation camera Hero 5. However, recent moves by Garmin Ltd. (NASDAQ: GRMN) and Apple Inc. (NASDAQ: AAPL) in the camera space have made GoPro investors nervous as they worry about the company’s future amid increased competition.

GoPro Inc. (NASDAQ: GPRO) is betting on Hero 5 to reverse its declining camera sales. The company was forced to cut the price of its Hero 4 Session camera by almost 50% to try and spur sales amid soft demand. But the move has not only done little to boost sales, but is also hurting profit margins.

Garmin launches Hero 5 clone

First, it was Garmin that appeared to have hit GoPro where it hurts most following its launch of what is widely viewed as a clone of Hero 5. Though Hero 5 is yet to be unveiled, several of its features had long been leaked and Garmin’s Virb Ultra 30 looks like its copycat. That has led some analysts to say that Virb Ultra 30 could steal market share from GoPro in the action camera space given its competitive pricing, thus frustrating the company’s recovery efforts.

However, before the dust stirred by Garmin could settle, Apple has launched iPhone 7 with a greatly enhanced camera that it has caused many GoPro investors to cringe. Apple has designed the camera in iPhone 7 Plus in such a way that it can easily replace GoPro cameras in the world of action sports enthusiasts. As such, the move by Apple could further complicate the picture for GoPro in action camera market, possibly making its recovery in the space a pipe dream.

Eyes on Karma drone

With GoPro Inc. (NASDAQ: GPRO) increasingly coming under competitive pressure in camera business, some investors and analysts are putting hope in Karma drone as potential redeemer. Karma is a small and silent drone that boasts high maneuvering capability, which means that it could be a serious force to reckon with in the drones market, thus unlocking an important stream of revenue for GoPro.

To hedge against the weakness in camera hardware business, GoPro Inc. (NASDAQ: GPRO) can be seen expanding into content, software and platform businesses.


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