| Image: GoPro |
GoPro is coming off of what may be one of its most exciting product announcements in years, but its most recent communication to investors and regulators could cast a shadow over the launch. In it, the company says that new market forces “raise substantial doubt about the Company’s ability to continue as a going concern,” citing “unprecedented increases and volatility in memory costs” that have seen price increases of up to 115%.
There’s a fair amount of nuance and complexity to the situation, most of which is pretty deep in the financial weeds. The upshot is that the company’s management is taking several steps to try and avoid defaulting on loans, including exploring a sale or merger, investigating “opportunities within the defense and aerospace sector,” selling “certain non-critical assets” and negotiating with lenders. It also says that it’s “reducing operating expenses through disciplined cost management,” citing its recently announced layoff of 23% of its workforce.
Despite this, GoPro says that some of its plans “are dependent upon factors outside” its control, and that there are no assurances it’ll be able to continue as a going concern. If it can’t, the company says it “may be required to significantly reduce, restructure,
cease operations, or seek protection under the Federal bankruptcy laws,” though it points out that it hasn’t started on any specific bankruptcy plans.
In the document, GoPro says it “expects to continue to incur operating losses and negative operating cash flows” due to lower-than-expected sale throughout the first few months of 2026. Hopefully, the company can find a way to turn things around soon, though if memory pricing is a major factor, it may be a while before things really improve.