GoPro Inc.'s stock dropped 6% in active premarket trade Wednesday, after key supplier Ambarella Inc. provided a disappointing outlook for wearable-camera sales. Ambarella makes semiconductors used in wearable, flying and sports cameras, and is GoPro's largest supplier, according to FactSet. Ambarella reported late Tuesday better-than-expected fiscal second-quarter results, but said it expected third-quarter wearable-camera revenue to be down sequentially and year-over-year, given the timing of recent GoPro and Xiaomi product launches. Analyst Jim Duffy at Stifel Nicolaus said this strongly suggests there's a low probability that an additional GoPro camera based on an Ambarella platform will launch before year-end. "GoPro's execution since the IPO has been impressive and we have increased confidence in the leadership team but investor expectations for growth remain high, particularly into 2016," Duffy wrote in a note to clients. The stock has tumbled 25% over the past three months, while the S&P 500 has lost 9.3%. Ambarella's stock slid 12% in premarket trade.
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