The American action camera specialist managed to post a profit for the third quarter thanks to a more intense direct-to-consumer (DTC) approach and strong sales of new products, which helped boost total revenues by 114 percent to $280.51 million. Analysts expected revenues of $234.5 million.

GoPro’s net income for the three months to Sept. 30 came in at $3.31 million as compared to a loss of $74.81 million in the year-ago period. On a non-GAAP basis, net income of $31.05 million compared with a loss of $61.27 million a year earlier.

The GAAP gross margin rose by 13.7 percentage points to 35.4 percent thanks to a channel shift to DTC, which generated 247 percent higher revenues of $81.3 million in the quarter, combined with higher revenues from subscriptions, which were 35 percent higher than in the second quarter at 501,000.

Subscribers placed higher average orders than non-subscribers. The company’s chief executive, Nicholas Woodman, said that 85 percent of the unit sales made on GoPro’s website for its new Hero9 Black camera came from new annual subscribers. He expects to build up to one million subscribers in the second quarter of 2021 and two million by the end of 2021, representing $100 million worth of annual recurring revenues and delivering an operating margin of 50 percent.

Wholesale revenues rose by 85 percent in the latest quarter to $199.2 million, thanks to strong demand for the Hero8 Black and the new Hero9 Black cameras. They jumped by 161 percent to $157.7 million in the Americas and by 172 percent to $58.2 million in the Asia-Pacific region. In EMEA, they grew by 31 percent to $64.6 million.

With operating costs reduced by 9 percent to $90.5 million, including cuts in R&D, GoPro posted adjusted Ebitda of $39 million, compared with a loss of $53 million in the year-ago period.

The company estimates that end customers bought more than 955,000 cameras during the quarter, exceeding expectations, with the average price rising by 11 percent to $304. Inventories were cut in half as compared to a year earlier.

The management expects a higher sell-through of 1.3 million units in the fourth quarter. The company’s revenues should end up about 31 percent below last year’s level in the last three months of 2020, but the management is projecting a non-GAAP profit for the current financial year and in 2021.