GoPro Inc (NASDAQ:GPRO) has delayed a much awaited drone launch. The company stated that it would delay the debut of its Karma drone in the first half of this year and will begin selling the drone in the holiday season.
Nick Woodman, GoPro CEO announced the delay but did not give the reasons. He called the decision a difficult one adding that the organization had planned to release the drone on schedule earlier this week.
Although no one outside GoPro knows the what the Karma looks like, the company gave a hint in 2015. The drone’s camera will have minimum 1440p resolution and video will be highly stabilized.
Several investors had regarded the unreleased drone as one of the reasons for GoPro’s struggle over the last year. In 2015, sales of the company in its main camera business nosedived. The company’s shares dipped as a result.
GoPro declared its first quarter earnings and they were disappointing. Compared to the same period last year, its revenue came down by 49.5%. Also the company went from a $22 million profit to a significant $121 million loss.
Faced with the crisis, the organization declared in January that it would shed 7% of its employees. The company also had $19 million in extra losses in October when it reduced the price of the Hero4 Session camera.
Many analysts bombarded GoPro’s executive teams with queries regarding its drone’s delayed launch. One analyst questioned if the delay would impact the still not announced launch date of the company’s Hero5 camera. Brian McGee, GoPro CFO answered in the negative. The Hero5 is a much awaited GoPro product that industry experts believe would boost the organization’s sales.
When questioned whether the delayed drone release will give extra time for GoPro to reconsider its price as well as design, Woodman said he could not give more information. He said the delay would enable the launch of the drone at a great time of the year in time for the holiday crowd.
The organization has tough competition against well entrenched drone producers such as 3D Robotics and DJI. They dominate the sector and waiting grants them additional time to improve their market position further.