Less than three weeks after the in-store launch of its much-acclaimed Karma drone, GoPro has announced a recall and is struggling to stay afloat with both consumers and investors.
GoPro on Tuesday recalled about 2,500 of the remote-controlled aircraft that were sold since the Oct. 23 launch after units lost power mid-flight “in a very small number of cases,” according to the company. GoPro is asking the owners of drones which have not experienced any operational issues yet to stop using them and participate in the recall. Replacement units are not being offered, and GoPro plans to resume shipment of Karma once the issue is resolved.
“Safety is our top priority,” GoPro Founder and CEO Nicholas Woodman said in a statement. “A very small number of Karma owners have reported incidents of power failure during operation. We have moved quickly to recall all units of Karma and provide a full refund while we investigate the issue.
“We are working in close coordination with both the U.S. Consumer Product Safety Commission and Federal Aviation Administration. We are very sorry to have inconvenienced our customers, and we are taking every step to make the return and refund process as easy as possible.”
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The recall comes a few days after GoPro executives informed analysts that its new Hero5 waterproof camera had late-stage production problems, failing to elaborate much further. All told, both recent setbacks have driven stock prices into a tailspin, down as much as 20 percent last Friday and 10 percent as of Wednesday. The company released its Q3 earnings last week, with sales plummeting 40 percent from 2015 at just $240.5 million versus $400 million. Additionally, since August 2015, shares have dropped over 65 percent, according to Market Watch.
To compound the issue, the Law Offices of Howard G. Smith announced Wednesday a formal investigation into GoPro, Inc. on behalf of investors and the company’s potential violations of federal securities laws.