GoPro (GPRO) 5 Feb 212020 Q4 Earnings call transcript

Company Profile

Participants

Christopher Clark	Vice President, Corporate Communications
Nicholas Woodman	Chief Executive Officer
Brian McGee	Chief Financial Officer and Chief Operating Officer
Paul Chung	JP Morgan
Andrew Uerkwitz	Oppenheimer & Company
Jim Suva	Citigroup Investment Research
Nik Todorov	Longbow Research
Erik Woodring	Morgan Stanley

Call transcript

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Operator

Good day and welcome to the GoPro's Q4 2020 Earnings Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Christopher Clark. Please go ahead, sir.

Christopher Clark

Thank you, operator. welcome call. fourth and year and everyone conference earnings afternoon, to quarter GoPro's full Good today GoPro's me Brian With are; McGee. and and COO, CFO CEO, Nicholas Woodman;

remarks to Before everyone I'd get include like we that statements. started, our today may forward-looking remind

statements all to and are which performance, are not subject may and differ uncertainties, to a cause Forward-looking not other historical of results guarantees materially. statements that and risks actual future are facts, number of

We future undertake XXXX, with of Form are Commission. recent risk XX-K and Additionally, quarterly XXth, concerning available could XXXX change ended, a and A And these statements useful, a but results today, future believe information obligation as additionally, and information with that COVID-XX and events. GAAP December results XX-K any gross as well made basic operating loss performance. on on related XXst, Today September discuss XXXX. on the as including, our and duration margin, and on diluted to including in is per December net be enhances the of at ended, updated as basis. profit of We Information profit business to and today and limited we to most net report results. enable the which this the it information the or the time issued is of not operating perform based as the operating any available pandemic. annual on XXst, as forward-looking commentary of date. for impact similar can uncertainty to to, how economic the any on use this internally understanding and about is factors our GAAP own that today's operations. based choose press our is not result non-GAAP operating the Form a assumptions year update in expenses posted quarter annual statements ongoing ended, outlook We on year manner to non-GAAP and the manage of This XX-Q file our non-GAAP on SEC, reporting is information report expense, new results may in our website. share loss, non-GAAP Exchange because for our accordance in for and the with investors provide our to and report which comparisons analyze reconciliation to to means, each release of Securities evaluate do that afternoon, We filings we was found of Form

live Relations than statement this of other replay non-GAAP, year GoPro slides to the during otherwise unless posted numbers addition your metrics we In as The call and conference related are full detailed earnings financial the slides that commentary discussed fourth webcast call and XXXX. are All income website today management quarter revenue containing the and are to noted. and release, reference. have on link commentary posted management as well the a press today's and for data to Investor

I'll Now Woodman. Nick over CEO, and - Nicholas the to GoPro's turn Founder call to

Nicholas Woodman

good everyone. and afternoon, Chris you, Thank

commentary on our we to page started, Relations read the Before we get today everybody encourage I'd to to Investor like the earlier GoPro website. posted

$XXX the our our to share on and generated evolved a Q&A. XXXX, some into our of subscriber more and quarterly commentary forward-looking thoughts XXX,XXX $X.XX of and business XX% by In results, second the direct-to-consumer cash base for more This we will efficient, Strong GoPro we to directly than a expense $X.XX are addition we'll GoPro We In represented maintaining. grew go quarter, providing guidance, year-over-year in brief business. revenue, subscription-oriented contributed into year-end then our XXX% going subscribers now forward. in disciplined I committed EPS provides annual remarks to plus the performance an EPS approach this from year. cash and non-GAAP operations in million. of of half million and non-GAAP of for QX the balance flow an of $XXX achieved management, our half resulted second overview We year. to the with

a tool GoPro's amidst enduring XXXX the for powerful consumers creative professionals. Our experience sharing performance pandemic personal and demonstrates relevance for solution as

in spades the times. that proven and steps do happen. customers We've earnest. But innovation, not products benefits, we plan spend reasonable and benefit XXXX relevance in can of directionally to subscriber thrive their cameras significant the our time around Looking world while continue to our want world-class offerings. about ahead, XXXX. launching thank believe We wait the that excited We with a through in for again our outsized our even amidst can believe We're of maintain resilience when fortunately, other eventually expanding are software marketing, from core super-serving we during have world will rapid to employees pandemic is pandemic. hardware for to the to smartphones our users GoPro exciting with backed adaptability GoPro strengthen rebounds and levels that us our as within by to XXXX. challenging the business business, and new today I pace all taking throughout we're line software-subscription

dedication well operator, why and is for to we questions. And ready are we're positioned the future. world-class execution take now Your

Operator

we'll Paul All question Chung Instructions] JP right. with [Operator the All Morgan. first from take right,

Paul Chung

my taking for thanks Hi, question.

full what gives there? 'XX know you some know you kind the possibly know you confidence unit visibility sway second have the that large So guidance of the kind of just on providing in to higher the follow-up. factors one seasonal to and And rebound what of large of million your $X given you half, kind in a as this year past kind maybe I per then selling year can and in mix

Brian McGee

this Paul, hi, Yeah, is Brian.

channel shipped XXX,XXX about and ended units on units in million XXX,XXX about because delta X.X let's units. we units, we about down we sold-through and XXXX, at million that about the And So channel. talk inventory took year the X.X is,

place. got right channel And the inventory an distinction think that's we So in important to we've make.

As we on XX% our XX% XXXX, the continue looked and revenue in we DXC know, XXXX the 'XX, to up we XX% shift had transition, to okay. expect that from in to you at

have our very first into the million QX. visibility We hitting good and trends quarter, of our mark sell-through by to and in $XXX perspective selling the related on the guidance

in a think the million X.X - X.X we range is and to to units, And to of in so now million going and X be right kind million. sell-through million X.X the that on sell

to in the see 'XX. to DXC XXXX. in expectation XXX,XXX fact may we grow our and inventories and the 'XX into so we And would of in into bit and them more really that due even that's about So end units so channel, keep a growing, retail the our we're reduction at going to trim continue healthy and or is levels

Paul Chung

how been there? you for of kind the go you there kind And comments are traffic thanks like, North more unit kind you pandemic, the you what's the know were the driving GoPro.com which to consumers sales? again. preference and and website difference Excellent, there. support around I And a are EMEA mentioned to of sell-through more then relative make? regionally by to know, noticed up overseas Thanks. Any was for And a guidance, softer. your American maybe is you you of can XXXk know bit Asia

Brian McGee

quarter. great did GoPro.com Yeah, record

know, basis performance business sequentially, You on XX% the about so GoPro.com. on we've doubled a year-over-year terrific

You within know our in came revenue guidance. our

a of some between, revenue in on definitely also Within right made taken our want XXX,XXX than EMEA into QX Europe North are and of expected kind saw up and into for sell-through that X% the we for we related on between what retail our COVID, is were in as that in consumer, was and the We've that we of slowness America we think and split heavy was more than APAC and the forecast turning looked little We some largely split better well to units and account do to channels, provided commentary. retail within, like coming at Asia. bit and did DXC.

Paul Chung

- then And great. Okay,

Nicholas Woodman

more We of Asia, in shopping versus to color, to be And there consumers regions add one offline like seem or - just Paul, for answer specifically dot-com to as definitely some certain up consumer saw the as COVID and online bit a that. is with and no. preference a part EMEA strong of softness your online performance lockdowns shopping to hit a and then ramped that the take did

us softness it the as map regions. So seem pandemic. for to we the be been There certain business growing not specifically in has just to to internationally. COVID our headwind a could just relates lockdowns intensifying There

Paul Chung

kind of are you help what with of low from subs that the good confidence fix then my the subs, that And related Thanks. you progress gives know, questions cohort for off stores know then kind And large would GoPro the on, of most? non users you features there And, when concerned churn any sales, there. GoPro you know, from they're and year we in moving deter next of? kind are your is maybe kind cumbersome them switching rates consumer engaging costs very What high to kind or of of retention? of lap last

Nicholas Woodman

that say benefits that advantage of for to of retaining they're to that to the what going to both and very out rates, biggest do making in we direction. they're the to subscription is that insights you really up benefits. subscription happy able mapping subscribers of impressive gives research know, points can relates good consumer value continue driving advantage we them, and subscription low that the good use churn customer the consumers the getting and taking drive the we we advantage so just right ongoing a as a better did, moving and the down be with And benefits job as to feeling and continued as customers the those those. I'm subscriber signing benefits that have, and do they're it people We've various the Well, retention as to and that's subscription. we're us They're that take to get all taking happy the we of awareness that drivers the of consumer to happier improve believe And behavior we're understand, retention shared, then key engaged we we've marketing an GoPro of ongoing. a are of

are good really we about And February. that's where feel just that. in we today, So

tap So year our the we've got a churn rest retention and improve on to keep the of for low. lot further

Brian McGee

were QX seeing top in ASPs, the QX, margin that drive GoPro.com. guess in improvement. bit 'XX, standard management we've point I our up XX% on in so given in what's again, a add XX%. in it Paul, guide I GoPro with the the have commentary a $XXX we thing guidance would little our are profitable for very even million seeing is, of XXXX to And on that helping generation you know we're implied a saw or And, to cash we And would traction to solid, solid of range. solid also We that's visibility margin,

in So ahead in we're very QX, and results 'XX. the look how we'll with went happy

Paul Chung

Great, thank you.

Operator

Our with Company. All right. from [Operator Instructions] next is Oppenheimer & Uerkwitz question Andrew

Andrew Uerkwitz

Hey, ask letting gentlemen, questions. for me of thanks couple

The first for is guess Nick. probably I one,

subscription. I that the With cameras. new the and to capture use app using don't $X.XX this GoPro Yeah, presumably is they new, the - the - guess, they're trying have subscription of

about those on subscription GoPro the traditional if any So can should convert think fits what's And folks number the into that your shed how - hopefully users? year? it light you as can we to you for number how

Nicholas Woodman

smartphones Thanks, we're most as spot pit of way photos solution out and videos. their excited on. helping Sure. GoPro all from personal suffer to users It's and any the us of is about you're the our personal that for Andrew. get app, camera offering serve a revamp the a bottomless content including subscription-based to upcoming We roll. the camera, Yeah, really

- very feeling where a you're it, everybody a there's a see where phone and photo the at good when with a have shared problem or widespread their great you and to because great photos it again. You And a that look that lucky, acknowledge roll. camera to your going chance video sent by to or know have you capture wistfully actually that moment know you phone you uses they a that's one save you videos and never they're are. and you get And

that be video upcoming GoPro with to even of revamp this a easy makes send of the building you a what scale. know, drive have brand making that that people we an globally. know, it as to wall the app that to the to problem it a that's And punch don't become it smartphone subscription-based, you're send to a want this photo that We well solve size solution people. annual that have auto video later, it to this keep camera. importantly, you this the really grow of to terms your serves most proposition simple app, the favorite see in But have something significant or going of GoPro to to all usage way you And value and extend as the is our positioned you personal think going this over market for on revisit really and that so anybody straight with going our solution really it to the send to your owns feed it think to its for the is capabilities. basis. that awareness is help you open at class powerful the user what think GoPro very track already a is brand that for go for or we moments. to use your then OpEx presented we app you of above our going to it'll meaningful roll, that, feature, we on Mural much time is app you and be make camera And out are time, it we most a impressive combined app by directly we're to you for moment and you pay top which it wheelhouse, there, can because take will your to from you on tier, it GoPro, additional a tools, with the its Mural, of personal to this app access where another chronological editing as generation people don't And scale ultimately, get And to will enabling, content. user over in to have on It's yet believe possible users. go weight don't And

So we're pretty excited it. about

Andrew Uerkwitz

appreciate I additional I it. that next And - got question Yeah, color. guess the

Nicholas Woodman

And I one this. let answer guess was There part your sorry well, to question, me - of answer.

and monthly sunsetted out That, to app year million half It's You X million itself. which an we're know $XX app, Quik active GoPro free as includes upsell year. has we That's a users. users outdated also That's roughly the roll have the a monthly for the they're Mural we them of bill the of year over the to not know, then slew the and users, pretty a experience new going to That to for editing well assuming of course, subscribers [ph] app opportunity you opportunity the these GoPro time functionality. relative us the app. very experience, already to to tools a that ago, active [$XX.XX] as over premium roughly significant time. app for to experience. And GoPro us And a GoPro GoPro market Quik X.X it's migrate new app. them a

just growth got this initiatives we've many for two service. of subscription new those are that So

Andrew Uerkwitz

and And Got for stores think something a would it I or to mostly it, there got like related that I that's it guess around sell-through just you down guidance little decline in XXXX, more know, about coming year-over-year, COVID? color further is Is on just it's just bit Or there looks helpful. Any your is that to a a in sell-through helpful. fewer retail? on it basis basis? caution be the when unit

Brian McGee

recall things, know opportunity opens the that on really X.X cautious, would there million, in there's up one Andrew sell-through. have being X.X year to about had we it's to world for number XXXX, expand you Hi, It's think last million early as raised of I same COVID are Yeah. you as and we Brian. X.X with

ability the that and a we have that. of profitability back, it from financial we So would because further leverage up step get to lot increase

upside. that's I think - And so that solid

end - lower more end see more points and price less and also will on high We to as the movement the as well. $XXX XXX

helping with helping GoPro.com, going that's be to profitability. that's and margins to So in that's drive supported ASPs,

it's there's world And think, we as So capability have upside comes hopefully with unbalanced the know, you today. think I it's we back. -

Andrew Uerkwitz

And thinking just looks we How one the end haven't forward? are balance you of it's by last that or then view now, your on healthier while. use opportunities, affecting your investment M&A is it year like that cash whether your question, Got based be it. going a guidance, about potential seen cash in the is How of to internal? on going

Brian McGee

debt, XXXX, well, and up good. cash which of back Yeah, is convert, in actually pay early two up and of we'll $XXX uses and split take there's out right the in in that them 'XX pay million the we QX, more

an website from OpEx think invest will and we we I in to experience innovation to continue GoPro.com. we and will be hawkish, continue technology, perspective, said the improving for

initiatives and prudent are key while take those be more and So back. be there's that areas cut to the will able other for investment, company,

it you for want you million know, it's also going to cash be revenues we prudent million at range investments because, we're in too, to our that's upside, in XXXX. And $XXX to to the make ending about of the know, up. your XXX our up And so point, go But year $XXX contributing actually those stay, million So to we're XXXX. OpEx balances. definitely and

for haven't a had $XXX number years. of a We number million in cash

a had flow. was cash company, in are the second which two - So cash in million above you records half in know, operating for well was we row quarters $XXX those our the generation $XXX million, where

Andrew Uerkwitz

Got guys, you quarter. it. great so much, Thank

Brian McGee

Thank you.

Operator

right. Citigroup next Research. Jim question the take from We'll with Investment All Suva

Jim Suva

your Brian through have sincerely remarkable quite very for on one I for results. challenging Nick. know, very, year and very being to some you one And normally know, to about outlooks. a XXXX very talk Brian. was you we managing And say seasonality, Thank XXXX, very, you I CFO, you you, want and good realized know, quarter-to-quarter, of you in difficult. and I you're Brian, question Nick gave XXXX congratulations commentary

know, largely wonder built For we that later draw to you still as or travel I extreme because of you. even CEO, maybe is you about Thank interface much. stronger, I a you do Are more And us? surpassed the half stronger, your seems it'd I'm that vacations revenues are, And then in fantastic. what vaccines subscriber stuff seasonality the Nick, a has expected? and place items more, and be you of subscription kind function your EPS kind year, model move you know kind that in prevalent base to or two been which, COVID three that enhancements, whether really of a so just wondering, go or on in be know, people couple seasonally year for the variables, thinking was lapping or of expectations as video Or editing, than there their increase stronger to the guidance? chance know, and could bringing of there you or know, have and one, really really being upload about on second you lot apps into your just even more

Brian McGee

you. Jim, Hi, Yeah. thank

start. me Let

XXXX. you 'XX 'XX over be know, grow two. And is QX XX% year-over-year pandemic We just will course, the obviously to the hit in QX first be in expect in growth, - 'XX of that in 'XX. because at quarter our us guidance on we'll The and every when quarter quarter one imply biggest over half a basis growth in

be stronger QX some seasonally QX be company. will there the and So, for tend to seasonality

that you in should kind of modeling. expect so the And

Jim Suva

so the Hey bringing that is that thanks, this app on up Brian. much? really And, Nick anything

Nicholas Woodman

as our are happy it's and a subscription to we're taking see the before, consumers aligning. how I that reality shared are both Well research advantage of benefits good Yeah, question.

heads there's XX% of their and GoPro.com they hats value shirts one for their to their savings. items, And for Of getting XX% two, a they're $XX.XX you subscription quickly, are very through, cameras, going because the buying. non-camera mounts those are at to the course, with of that their There's savings to we're that and $XX.XX the comprehension lion's there, that the that's real goods seeing And seeing the annual subscribers that taking on see, up the savings we're quickly paid savings annual good and at or it and get really they're that GoPro to GoPro.com backpacks shows important. of know, accessories subscribers, sales subscription. lifestyle advantage who share accessory

see and we're tools content Management ongoing. as going clip to from what generating building what be of their then we're it experience, Mural is really going about overall to the going moments do upcoming customers as moments of customers capitalizing for offer that's track our most phenomenal So know, the the app, in GoPro editing it's keep reasons the in is a significant you of next. and on that's a already share Content which capture And exciting And they're seeing to you the that there. really in safeguard helps our we're important company But meaningful and is as job think of really content new customers, well, the a value the of are a they're people and cloud that wall. the at for they really important our usage easily enhancement feedback be relates want helping our course, that to some want introducing on one you capturing using we And backup steady to those app positive sign. to us and GoPro to a the wall, because And their to excited lives, good we're tools know, up subscribers. then significant revamp, people are they the to giving editing backup app our

is And for that's our kudos off going us. teams team well. customers research from GoPro strength learning want So, the out to what business consumer you see business doing a think think seeing building lives. - It's this our in product it you're why so And purpose and that's them. I and job spades. is then we're both a know, in serving perform and in that real underlying And that's I know, it. you our people's for paying terrific of that, And research you going the, the

Jim Suva

to Thank on you. a And and looking so you congratulations great XXXX. year team your to and forward

Nicholas Woodman

you, Jim. Thank

Brian McGee

Jim. you, Thank

Nicholas Woodman

for looking if business, begins driving to GoPro I because pandemic, don't obvious XXXX, we're amidst sitting perform go pandemic we not around want really we the - well forward way successful back. mentioned But can prepared this We're a a the waiting and remarks, reasons. away snap poised as the my as for world for need and all in then that and We're to we're happen. to business growing the to

Operator

take with Nik right. All We'll from question next Research. the Longbow Todorov

Nik Todorov

thanks to business XQ, I transition expected Brian XXXX. you model to become direct and your in you a announced the time GoPro.com guys. Nick, when guys of in to think your Yeah, plans at sales majority

quarter fourth the XXXX you think was a in the the majority GoPro.com in expect of think I to below guided point to And go changed sales in second time? GoPro.com at little than - GoPro.com direct? D&A since go original when plan has came GoPro.com should row the a for their lower I we wonder, expectations. should common that anything just will become You and we quarter, in sales some bit your XX% where announced

Brian McGee

is retail in business, retail doubled it But how going completely quite XX% to and believe and our and was clear over QX going I we on was a website the side, of on on when back with which start on in basis. we we wasn't me shut, come one, Nikolay. back perfectly talked we're frankly, that year-over-year visibility about When Let end. XXXX. our can to May, our also have own saw And first we it that pandemic

since still so back, then, important channel. it's we've an seen And come retail

reach, have in GoPro.com we to have from we that we distribution profitable more real company advantage, be two channels our plus a the perspective it'd I that think or channel get that numbers, actually obviously us GoPro.com retail. that's know, you for So GoPro.com we're it with that due a retail channel, our coming of consumers, was and and drive product able lot for part whether strong is globally, business. driving back to that, were the was of raise chunk throughout a happy to, to continue you of we'll GoPro.com But we and subscriptions. know, fact XXXX, retail quite good a very that

Nicholas Woodman

going would add hear than you thanks and is to being for that, to as our GoPro. these yield cameras, to to strategic We've we're I sure because customer where healthy reduces we're or thank that GoPro of retail an they are buy complain of understanding in never this And it to our to revenues back who that, might know, we saying, And we of but as returns a that making, got to values make our you've investments them significantly, investments direct-to-consumer job said, do the many job having market for and opportunity upselling, us just us improve to that to enhance year. - got a from continue the back not investing double have about I how than much want better are make last our do those help all mean, e-commerce retail a support team And being blast and and expected whether coming again, what to the take you're better able God accessories, the from partners risk their core to everybody to That GoPro, for merchandising consumers, to to it's a going year, a it's, our it's the our capabilities, us capabilities. able you it GoPro.com But are of they time. as a fraction that platform, you and to lifecycle. the about you just know, Yeah, channel to, retailers as better GoPro of to and us. well, it's is you're able mass camera opposed know a as not, continued of strength riskier significant and numbers, one and do done. a what performance direct-to-consumer you our for at are their helpful better when lot is succeed a marketing were to a of going of improvements owns actually our and approach actually more is who case developments investments in a we GoPro. alone that quickly a channels' even got that's significantly ton the whole in individual had to bounce fantastic teams we technical standpoint, know, direct of a number were our

a another way our a business how and seen So I I investments this a absolutely question our just not that our there's opportunity approach. of greenfield improve lot make as help while marathon, see is time. sprint, And over we of and you significant know, answering a opportunity your grow to And - our that's capabilities, don't business strong that direct to a see us we while improve negative. we just these channel be direct-to-consumer have retail could drive possibly to

Nik Todorov

mean, sell-through second - a more year calendar it year. if at expecting sell-through. the the implied down you're Got sounds question I guidance, demand the and trends be Maybe I full a look like on it. of in to half overall

from this that part thinking is, the there's for reason You think of the that you most know, But know, under some maybe guidance. be people to going that's differently. impression COVID. I operate And normalization you're

at that very space, looking if I go the compare we're overall the to at XXXX. about very - be demand easy How GoPro as are if growth from flat not think, we expectations thinking consumer for think you environments there's are I that electronics for least versus demand - challenging XXXX, broader will forward?

Nicholas Woodman

that Well, represent consumer Brian, we to from a, they're anything. up - differ active I'll that, in per are, value consumers. pick more this our you know, ways traditional out we're more if and life many those human to more demand The then, tied as consumers electronics, experiences. where want think more add to I the activity. know, they're you the is in the shared outlook of se, And celebrating of our guide, we and proposition you sharing humans terms are, we

So, sales is outside and platforms, game if that things finally electronics game more fall when that consumer same stay you we or more at streaming consoles about, you remain know don't active, travels the you're somebody video video into in and category. talking know, goes or home house

the So to positive as that to for succeed even level have that world, that baby if on business. our positioned can very imagine can another impact better the relates my pandemic, to bouncing thrive during point it and steps, if the back, even on outsized takes positioned well you we're

into Now, our we're not that guide. factoring

Our we bounce waiting. might it be world make hit and some point. will to at we'll But others, think positioned harder. that, net-net, that the outlook is that better as to continues relates of there'll way a go the world and there the succeed, pandemic, back world, in be you no areas certain to know, it's been, it the be the we're along And condition mistake;

Brian McGee

at distribution guided going if And Nikolay, be the up QX. normal, enabled you the quarter, evenly other I to us three, that kind we mean within to QX seasonality, so two, I in more I to in company think course, $X.XX plus make actually or breakeven, think the minus, least and four. quarters which for of basically look profitable distributed, more how it's at is of by point

can in think we QX. So profitable And in we time. done we that haven't quite a be long

of if know but is you And for more a a very they good. pretty XXXX taken on year-over-year on profile strategy XX% back, well product on basis, the that But bad unit, to Not comes some mentioned, company, darn comes XXXX up continue XX%, had we're demand ASP and we forecasting the generate as also get. drive revenue more to basically and end, to profitability high and world profitable shift the GoPro back a for since continuing cash. have to for So the as the which the very and lot worked on we we've consumers opportunity the growth. stronger, Nick to in a as

Nik Todorov

provide And was our that last if mistaken, I you about believe, number XX% subscription a give who if we retail? the rates as Maybe know, wonder on people purchases can much know, XX% how that not last think some It Nick, [indiscernible]. GoPro.com. an metric? shared think through conversion conversion it lower, seems cameras. rate you quarter mentioned, I on Okay, it's to bought question, on you metrics on can about us Thanks. on that flagship should update And, I - like you you numbers? in some you us

Brian McGee

we chime quarter for XX% GoPro.com. close initial one saw I had Through you conversion the conference on start then believe XX% in continued the GoPro.com can the back XX% to Yeah, in. as November, on that the at can I on climb, and subscription on and call to to ended we Nick mentioned. range, Yeah, uptake in that maybe

So subscriber quite number. helped up, growth even the stepped frankly, into And that's definitely continued, QX. which

very a much similar kind through metric. obviously that's nice I to rates range. are And X% is So, XX% those retail And organic think around lower. of

coming share So from of subscribers obviously GoPro.com. that's lion's the

Nik Todorov

Okay, got it. Thanks, guys. Good luck.

Brian McGee

Thank you.

Nicholas Woodman

you, Thank Nikolay.

Operator

with we'll And Woodring line Erik, ask from to question like is Stanley. you your a open Instructions] the take would Morgan [Operator question. next if Erik

Erik Woodring

me? you hear Can

Nicholas Woodman

Yes.

Operator

we Yes, ahead. Go hear can you.

Erik Woodring

Okay, perfect.

guys. that, about Sorry

So I to, one time, cash CapEx has just balance. of just obviously, at think follow-up million to fallen significant want your know, the questions Andrew's XXXX. in those But same you $X the I earlier, on

more why And to cash? I higher ramp your do you business outlook building you're of think then as generating that future, if you love into about to not growing, I'd just So that the kind that about a how become growing get profitable follow-up. the know have you on more think

Brian McGee

from much the perspective. of to good such, CapEx purchase then and more think related is display Yeah, a job point two share and quite a which retail, of things, managing tooling it frankly, really And I engineering the able been an We've engineering do lot and lion's is in CapEx, spend. of tightly.

team money on more and a much direct market as because actually need That's we better being retail spend to footprint, POP. perspective. to and And method a we're effective and to note much prudent more from go and POP, that's another then about for don't how going go-to and profitability important So why more engineering we're that. we reducing why doing efficient on us efficient for the reason it's is

Erik Woodring

videos aren't of myself question My about and know, and how I know, second Okay, well. trying guys that you users, smartphone well I guys are users you to, having just perform out you doing be, the about to You roll, would GoPro I know, that love think that? you are aware how going to GoPro that's don't all lost curious as those only to as awareness that's solve of you consider Thanks. brand, can these that you're camera brand that? just nice someone that pictures helpful. perhaps your consumers obviously, the perhaps as get know in going this and problem you're, But it's brand something know,

Nicholas Woodman

active consumer the And ranked ways a It's still But Well, sunset lot Quik really before a that that true. has well not incredibly really of drive there app, had two GoPro be ago. highly app million it users. had hardware we'll regarded for only with number but years of awareness employing, monthly app, we it's in GoPro apps reviews, in at stores. X.X success the GoPro the I very we've mentioned, we are the target science, rocket haven't app to which hardware, to that's do almost we for owners, because

scale have the community. a of I the of Quik of use to the athletes product the And direct brand and GoPro to that this large the app, outside so make mistake, app network of course, that GoPro we'll we've celebrities be neighborhood followers, think the that we've its we follower the popularity be million, GoPro employing the popularity fan no XX of And But the that same It's a grow million going base tactics drive that is got. app's and base very XX extended GoPro in to awareness awareness of of then to got social we're you leveraging followers. all influencers, work new with. we

front I know, as we're feeling then people. have all a So we're And app, app. you front, also And and awareness branding it's solving on around wonderful more being great through marketing very value GoPro do make that app the your for awareness helping regarded organization. your pretty and well for they the when think marketing is product, out for you And and photos their a really you on advocacy. customers of good, from doing problems virally you're that you is get strong also and and the a about sharing successful, drive most of because when going GoPro the job the for centered often you them the to driving videos, because

have into So the in we and ultimately on of number and scale subscription meaningful ways the that something awareness list to over GoPro goes the terms drive of time. app

Erik Woodring

you for color, last Nick. guess really I that's Now thank helpful, question Brian. that for

and to relative we're curious that you're then pulling guidance how gave perspective, OpEx obviously over G&A marketing about guys from items, you a curious, sales Just Thanks. those also you're going them. if to back in relative just XXXX. for line thinking if R&D, and or But some you're of growing

Brian McGee

There'll able sales we're we'll being some offset investment less see growth little by see some bit things marketing. growth in on we'll think of I in spend and G&A. to reductions be R&D. in Yeah, a But and basically

Erik Woodring

guys. Thank Okay, that's awesome. you,

Brian McGee

you. Thank

Operator

additional are appears like turn conference It I'd All questions at there Mr. right. closing time. no Woodman, to this the remarks. back you or any further to for

Nicholas Woodman

appreciate you, through super-serve plan We succeed to and joining of puts can support. you, for today's Thank during off. you signing who to recover world to your Thank future the Thank and XXXX, We're all grateful like GoPro and subscription this we continue operator. I'd time employees genuinely strong offerings you GoPro's for pandemic, reiterate to position GoPro's this a when earnest. are excitement making predictability. possible. group scale, importantly, in and thank again for is for We And which us customers high GoPro's everyone. margin This everyone value begins we and partners through our again. call. to in profitability where team our believe unparalleled to this

Operator

This call. you participation. for concludes your today's Thank

now may disconnect. You

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