GoPro warned it may not survive. The AI memory crunch is killing companies that make things people hold. GoPro has issued a going-concern warning, citing a significant increase in memory prices (80-115%) as the primary cause for a 26% revenue decline. The company is exploring strategic alternatives, including a potential sale or merger, and is considering a pivot to defence markets while implementing 23% staff reductions. This crisis stems from memory manufacturers prioritizing higher-margin AI data center demand over consumer electronics.

• GoPro issued a going-concern warning due to a substantial increase in memory prices.
• Memory prices rose 80-115%, significantly impacting GoPro’s earnings forecast.
• Revenue declined by 26% in Q1.
• The company expects to breach several loan covenants and is seeking waivers.
• GoPro is exploring strategic alternatives, including a sale or merger.
• A pivot into defence and aerospace markets is being considered.
• GoPro plans to cut 23% of its global staff.
• The memory shortage is driven by manufacturers redirecting capacity to high-bandwidth memory for AI data centers.
• Consumer electronics companies with thin margins and limited purchasing power are vulnerable to this trend. Continue reading https://thenextweb.com/news/gopro-going-concern-ai-memory-crisis-default