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Sunday, October 25, 2020

Why Does GoPro Stock Put So Much Importance on Subscriber Count?

It was quite surreal to note that when GoPro Stock finally put out its subscriber count- having topped 500,000, several investors started buying the stocks in droves. The GoPro stock broke the moving average of 200-day which it had set for itself at around $4. And this led to several technological investors wondering if they had somehow missed out on some fad. 

GoPro Stock
The GoPro Stock attracted a Lot More Investors After Increasing their Subscriber Count

The GoPro Stock mostly benefited GoPro’s HERO9 Black which received quite a strong demand from the market. It also helped lift up the paid subscriber count way above the 500k mark. Nicholas Woodman, the CEO, mentioned that it was all credit to the stellar launch of the HERO9 Black that the paid subscriber count had gone up so much for the company. And it goes without saying that this definitely bodes well for their preemptively set targets of 600k and 700k. 

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One advantage that the GoPro stocks enjoy is that most of the consumers are buying the products online- which leads to GoPro not having to pay any affiliate marketing fees. Also, advertising and marketing are extremely unnecessary for this company to enforce a demand. Profit margins expand- as customers are always bundling their purchase with a subscription. 

Attractive Subscription Offering for the GoPro Stock

The monthly subscription for the GoPro stock has given many customers the sanity in their life- as they provide a total camera replacement without asking any questions. The services provided also include cloud storage that is unlimited. Most of the end-users don’t have to worry about missing out on any camera footage or running out of space. There is also a $4.17 per month subscription that also includes a 50% discount on the website of the company. And since there is a possibility that any customer may cancel their subscription at any point in time, the service is quite affordable. 

Strong Growth Rate

There was a growth of 230% which was driven solely by the demand for the HERO9 and the strong subscription that resulted thereafter. This comes in as quite a shock considering the two-week post-launch period that took place last year. If the value of the product keeps on moving throughout the world via word of mouth, more and more investors might be interested in speculating the sales that might definitely increase in the next quarter. 

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Many investors have already been enamored by companies that have their subscription rates increasing in triple digits. There are several companies like that- NYSE:FSLY, NASDAQ:ROKU- some of the companies which have been posting a humongous annual recurring revenue, and subscriptions. We know that this comparison might just be the tip of the iceberg- but most of the investors care a lot more about user growth- than they do about profits. Precisely why the GoPro Stock has benefited so heavily from subscriber growth.

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