Shares of action-camera company GoPro (NASDAQ: GPRO) soared on Friday after reporting strong growth for the first quarter of 2021. And subsequent to the end of the first quarter, the company surpassed 1 million members for its subscription service, showing steady progress in this newer revenue stream. The market was pleasantly surprised by the report, and the stock was up 13% as of 9:50 a.m. EST today.
Surprisingly, GoPro only sold about the same amount of cameras (700,000) in the quarter as it did in the first quarter of 2020. But the quantity of cameras sold isn't as important as the quality of the company's results. First, cameras with a price tag over $300 made up 95% of total sales -- these weren't cameras that were discounted in an attempt to clear shelf space. Second, direct-to-consumer sales (which carry a better profit margin than retail sales) grew to 40% of total sales, up from 33% last quarter. Finally, its subscription services now have over 1 million members, providing opportunity for long-term high-margin revenue generation.
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Why GoPro Stock Soared Today