Following last night's earnings announcement from GoPro GPRO , Webush analyst Michael Pachter weighed in on several metrics, highlighted below.
-Q3 results exceeded our bullish expectations: Revenue was $280 million, compared with our estimate of $268 million, consensus of $266 million, and guidance of $255 – 265 million. The revenue beat was driven by higher camera volume, as well as stronger-than-expected direct and Americas revenues. Non-GAAP EPS was $0.12,compared with our estimate of $0.10, consensus of $0.08, and guidance of $0.06 –0.08
-Q4 and implied FY:14 guidance were also well above expectations: Initial Q4:14 guidance is for revenue of $550 – 580 million and non-GAAP EPS of $0.65 –0.69, compared with prior consensus of $503 million and $0.54. I
-Management does not appear to anticipate any gross margin mix shift issues in Q4 towards the lower-priced entry-level HERO: it guided to a Q4 gross margin range of 43.5
to 44.5%, consistent with Q3's 44.3%, meaning that the entry-level HERO is not causing gross margin degradation, at least not yet
Maintaining our OUTPERFORM rating, but raising our 12-month price target to $98 from $81
Shares of GPRO are trading higher by 14.7 percent at 78.80 in pre-market trading.
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