GoPro will restate financial statements covering fiscal 2025 and the first two quarters of 2026 after identifying errors in its accounting for certain debt instruments, according to a Form 8-K dated Oct. 16. The filing said the restatements constitute a default or event of default under the company’s credit facilities, convertible debentures and senior secured notes.
GoPro informed the agents under its revolving credit facility with Wells Fargo Bank and its term loan credit facility with Farallon Capital Management of its intention to restate, the 8-K said. It also informed holders of convertible debentures issued to YA II PN, Ltd., and senior secured notes issued to affiliates of Nicholas Woodman. The filing said the company requested and obtained waivers from default under each of the facilities, convertible debentures and senior secured notes.
On Oct. 16, the filing said, GoPro also obtained a waiver from its term loan lenders of its non-compliance with the minimum asset coverage ratio as of Sept. 30, 2025, and Dec. 31, 2025. The 8-K said the company cannot assure that it will obtain the remaining waivers on acceptable terms or at all.
According to the 8-K, the errors were identified while GoPro was preparing the proxy statement for the transactions contemplated by an Agreement and Plan of Merger dated Sept. 1, 2026, among GoPro, Action Acquisitions LLC and Starman Optical, Inc., and finalizing its financial records for the quarter ended Sept. 30, 2026. On Oct. 9, the filing said, the Audit Committee of GoPro’s board of directors concluded that the company’s audited financial statements for the year ended Dec. 31, 2025, its unaudited statements for the quarter ended Sept. 30, 2025, and its unaudited statements as of March 31, 2026, and June 30, 2026, should no longer be relied upon.
The 8-K said GoPro plans to file an amended annual report for 2025 and amended quarterly reports for the quarters ended March 31, 2026, and June 30, 2026, as soon as reasonably practicable.
One set of errors, the filing said, related to warrants issued to Mateo Financing, LLC on Aug. 4, 2025. The 8-K said the valuations incorrectly used an expected term shorter than the remaining contractual term through Aug. 1, 2035, and incorrectly included an illiquidity discount. As a result, the warrant liability was understated, and long-term debt was overstated, by $8.1 million at initial measurement, according to the filing. A separate error related to convertible debentures issued in 2026 under a Securities Purchase Agreement with YA II PN. The 8-K said GoPro used the fair value of the convertible debenture as the fair value of the embedded conversion derivative, rather than determining the derivative’s fair value using a with-and-without valuation approach.
The filing said the errors do not affect revenue, gross margin, operating loss, cash, operating cash flows, EBITDA or non-GAAP operating income in any of the restated periods. The corrections affect net loss and other non-cash adjustments, according to the 8-K. Net loss for the year ended Dec. 31, 2025, was $92.6 million as restated, compared with $93.5 million as previously reported, the filing said. For the six months ended June 30, 2026, net loss was $127.5 million as restated, compared with $131.8 million as previously reported. As of June 30, 2026, short-term debt was understated by approximately $9.0 million, at $81.6 million as restated compared with $72.7 million as previously reported, per the 8-K.
The 8-K attributed the errors to a material weakness in internal control over financial reporting, saying the company did not design and maintain effective controls to evaluate the accounting for and valuation of embedded features within financing arrangements. According to the filing, management concluded that its disclosure controls and procedures and internal control over financial reporting were not effective as of Sept. 30, 2025, Dec. 31, 2025, March 31, 2026, and June 30, 2026. The filing said the Audit Committee and management discussed the matters with PricewaterhouseCoopers LLP, GoPro’s independent registered public accounting firm.
The 8-K said management and the Audit Committee determined the misstatements were unintentional and were not the result of fraud or any other attempt to deceive. It also said no erroneously awarded incentive-based compensation was subject to recovery under the company’s compensation recovery policy.
