Together with the tough legal positions in the USA and Europe, said GoPro, "these factors make the aerial market untenable".
It said the Karma product "faces margin challenges in an extremely competitive aerial market".
While the company will continue to support those customers who purchased its drone product, Karma, company officials said they will no longer be in the drone marketplace. The company announced it would leave the business after selling off its remaining Karma inventory.
For the forth quarter of 2017, the company expects revenues of about Dollars 340 million. The camera-maker cited intense competition and future problems as the reason why it's not going to make more drones after the Karma, its ill-fated first drone, failed to sell.
The company said it now expects sales of about $340 million, well short of its own previous projection of as much as $480 million and the average analyst estimate of $472 million. The company ended the fourth quarter with cash and cash equivalents of United States dollars 247 million, up USD 50 million over the third quarter of 2017. Founder and CEO Nicholas Woodman is also cutting his annual pay to $1. GoPro cut the price on December 10, which helped sell-through at the expense of margins.
Sales of the newly introduced flagship HERO6 Black camera performed as expected during the quarter.
Morgan Stanley said in a research note earlier Monday that the price cut for the Hero6 camera would make earnings growth hard in fiscal 2018. "We entered the new year with strong sell-through and are excited with our hardware and software roadmap".
He hoped the actions would return the firm to profitability in the second half of 2018. These changes will see the company with fewer 1,000 employees worldwide in the coming months. According to the sources, GoPro is not currently in any active talks with a possible buyer, and nor is it clear whether there are any interested suitors right now.