GoPro is holding its first debt offering since going public nearly three years ago, as it grapples with a sharp drop in action camera sales.
The maker of the Hero series of rugged wearable cameras is looking to raise $150m in convertible notes, after embarking on a cost-cutting programme a few months ago. Last year, GoPro posted a net loss of $419m as revenues fell by 27 per cent, ending 2016 with $192m in cash and equivalents.
In November, Silicon Valley-based GoPro said it would cut 200 positions as part of an effort to reduce its overhead, including shuttering its media division. That was followed in March by another round of job cuts, even as it said that first-quarter sales would be at the higher end of its guidance range, at $190-210m.
“We’re determined that GoPro’s financial performance match the strength of our products and brand,” Nick Woodman, GoPro’s chief executive, said last month. “Importantly, expense reductions preserve our product roadmap, and we are tracking to full-year non-GAAP profitability in 2017.”
GoPro said on Wednesday that the proceeds of the offering would be used for general corporate purposes as well as a stock buyback. The convertible senior notes, which will be sold via a private placement, will mature in 2022.
GoPro repaid $114m in debt in 2014, just before it went public, leaving it debt-free until now. Its shares, which fell around 2 per cent after-hours on Wednesday to $8.29, are trading close to their all-time lows of $7.14.