GoPro (GPRO) Shares Surge on Microsoft Licensing (MSFT) Deal

Shares of GoPro Inc. (GPRO) jumped nearly 6% in late trading Friday after software giant Microsoft Corp. (MSFT) announced a patent licensing agreement with the once hot maker of wearable action cameras. The two companies did not disclose any specifics about the deal, only that it covers “certain file storage and other system technologies”.

“This agreement with GoPro shows the incredible breadth of technology sharing enabled through patent transactions,” M’soft Technology Licensing president Nick Psyhogeos said in an official blog post. “Microsoft’s licensing of personal wearable technologies is seeing strong demand as we partner with companies from all industries to optimize solutions for their customers around the globe.”

GoPro has had a difficult week. On Wednesday, the San Mateo, Calif.-based company posted lower than expected Q415 earnings and revenue, disappointing the Street by missing consensus estimates across the board. GPRO reported EPS loss of $0.08 versus $0.03 consensus. Revenues came in lower 31% on a YoY basis. GoPro also said it expects revenue to range between $160 million and $180 million in the current quarter. That compares to analysts’ expectations of $300.67 million.

Shares of GoPro have declined 45.90% in the last 4 weeks and 60.76% in the past three months. Over the past 5 trading sessions the stock has lost 13 percent. The $1.37 billion market cap company has a median Street price target of $12.00 with a high target of $21.00. The name traded as high as $65.49 in August 10, 2015.

GoPro is down 81.68% year-over-year, compared with a 8.14% loss in the S&P 500.

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