GoPro still isn't in the best of health, and that's leading it to make some tough decisions about its future. The action camera maker has confirmed that it's cutting nearly 300 jobs (from 1,254 to "fewer than 1,000"), and is exiting the drone market entirely. The Karma drone was the second most popular drone in its price class, GoPro said, but it faced profit margin problems in an "extremely competitive aerial market. Combine that with a "hostile regulatory environment" in Europe and the US, and the market is expected to shrink to the point where it's "untenable" to compete.
The company will sell what's left of its Karma inventory, and plans to continue supporting drones.
There are more steps underway to help right the ship. GoPro has cut the price of the Hero6 Black camera from $499 to $399 to spur sales, and chief executive Nick Woodman has cut his cash compensation to $1 for 2018. The company expects to take a $80 million hit for price protection for the just-ended fourth quarter, but the new moves should save GoPro $80 million in expenses for the new year.
It's a sad moment for both outgoing staff and for GoPro's hopes of expanding beyond its main business. However, there's no question that the firm faced an uphill battle in the drone space. DJI effectively neutralized the Karma with the more advanced Mavic Pro, and competing drones like AirDog's ADII didn't make life any easier. If GoPro wanted to stay in the market, it was going to have to keep pace with dedicated drone makers. That likely meant devoting more time and money than GoPro could afford to spend.