Exposing The Markiplier GoPro Stock "Insider Trade"

Markiplier, the popular YouTuber, recently made headlines for a seemingly prescient investment in GoPro. He invested $9 million in the struggling company just months before it announced an acquisition, turning his investment into an estimated $15 million. While Markiplier claims he simply "liked the stock," a closer look at GoPro's financials and the timeline of events raises questions about the nature of this remarkably well-timed trade.

GoPro's Dire Financial Straits

At the time of Markiplier's investment, GoPro was in a precarious financial position. Its revenues were down 31% year-over-year, while costs only decreased by 25%, indicating a significant squeeze on profits. Gross profit was down 42%, and operating losses had increased by 2.7 times. The company was literally burning through cash, losing approximately $560,000 per day. In December, GoPro had $50 million in cash, which dwindled to $27 million by June. This level of cash burn meant Markiplier's $9 million investment would have been consumed by losses in just 16 days.

Furthermore, GoPro's balance sheet painted a grim picture. With only $87 million in cash and receivables, and $86 million in inventory (assuming it could all be sold), the company had total assets of $174 million. However, its current liabilities—bills due within the next 12 months—totaled $405 million. This left GoPro upside down by $230 million, even before accounting for long-term debt. The company's book value was negative, indicating it was essentially a walking zombie unable to pay its bills. The founder even had to provide a $20 million bailout loan to keep the company afloat, securing options to buy shares at a low price if an acquisition occurred.