Live TV Streaming Platform’s Q2 Progress
Toward 2025 Profitability Goal:
- Raised Full Year 2023 Guidance for North America
- Posted Record Average Revenue Per User (ARPU) in North
America
FuboTV Inc. (NYSE: FUBO), the leading sports-first live TV
streaming platform, today announced its financial results for the
second quarter ended June 30, 2023 and raised its previously stated
full year 2023 guidance for North America.
Fubo exceeded North American guidance, achieving $305 million in
revenue, up 41% year-over-year, and 1,167,000 paid subscribers, up
23% year-over-year. The Company delivered ad revenue in North
America of $22.8 million in the second quarter, up 5%
year-over-year. This marks an expected return to growth despite a
challenged advertising market.
Double digit year-over-year growth was also posted by Fubo’s
Rest of World (ROW) streaming business. Total revenue achieved was
$8.2 million, up 40% year-over-year, while paid subscribers reached
394,000, up 14% year-over-year. ROW includes the results of
Molotov, the French live TV streaming service acquired by Fubo in
December 2021.
Notably, Fubo made marked progress toward its 2025 positive free
cash flow goal. Compared to prior year, the company reduced net
loss by $41 million (with a $12 million improvement in net cash
used in operating activities), grew gross margin to 7% and, in
North America, expanded ARPU by 13% to $81.62, marking an all-time
record. Fubo also delivered a second quarter Adjusted EBITDA
(AEBITDA) improvement of $40 million and a Free Cash Flow
improvement of $9 million, compared to the second quarter of
2022.
Fubo closed the quarter with $299.7 million in cash, cash
equivalents and restricted cash, and is confident that its cash
position provides the company with sufficient liquidity to fund its
operating plan until achieving expected positive cash flow in
2025.
Looking ahead to the third quarter 2023 in North America, Fubo
is projecting 1,327,000 to 1,347,000 paid subscribers, representing
9% year-over-year growth at the midpoint, and revenue of $272.5
million to $277.5 million, representing 25% year-over-year growth
at the midpoint.
The Company is also raising its previously stated full year 2023
guidance for North America. Fubo projects 1,565,000 to 1,585,000
million paid subscribers, representing 9% year-over-year growth at
the midpoint, and revenue of $1.26 billion to $1.28 billion,
representing 29% year-over-year growth at the midpoint.
Complete second quarter 2023 results are detailed in Fubo’s
shareholder letter available on the company’s IR site.
“We are encouraged with our execution in the first half of the
year, including posting year-over-year double digit revenue and
subscriber growth in the second quarter, while meaningfully
reducing our net loss by $41 million,” said David Gandler,
co-founder and CEO, Fubo. “With an improving ad sales backdrop we
remain on track to achieve our 2025 positive free cash flow target.
We are as excited and as confident as ever about the opportunities
ahead to leverage our resources on the back of key strategic
additions to our platform, including over 35 regional sports
networks (RSNs) and more than 125 FAST channels, as well as the
Maximum Effort Channel in partnership with Ryan Reynolds and
Maximum Effort.”
“Significant in Fubo’s strong second quarter results was our
year-over-year revenue and subscriber growth in North America,
which came in ahead of guidance,” said Edgar Bronfman Jr.,
executive chairman, Fubo. “This growth reaffirms the pricing power
and strong appeal of our aggregated, sports-first content offering.
As we significantly progress our path to profitability, Fubo is
poised to continue to benefit from the ongoing market dynamics
driving a decline in cable TV alongside the growing appeal of CTV.
We are confident we are on the right path to achieve our 2025
profitability goal and create exceptional value for our
shareholders.”
Live Webcast
Gandler and CFO John Janedis will host a live conference call
today at 8:30 a.m. ET to deliver brief remarks followed by Q&A.
The live webcast will be available on the Events &
Presentations page of Fubo’s investor relations website. An
archived replay will be available on Fubo’s website following the
call. Participants should join the call 10 minutes in advance to
ensure that they are connected prior to the event.
About Fubo
With a mission to build the world’s leading global live TV
streaming platform with the greatest breadth of premium content and
interactivity, FuboTV Inc. (NYSE: FUBO) aims to transcend the
industry’s current TV model. The company operates Fubo in the U.S.,
Canada and Spain and Molotov in France.
In the U.S., Fubo is a sports-first cable TV replacement product
that aggregates more than 175 live sports, news and entertainment
networks and is the only live TV streaming platform with every
Nielsen-rated sports channel (source: Nielsen Total Viewers, 2022).
Leveraging Fubo’s proprietary data and technology platform
optimized for live TV and sports viewership, subscribers can engage
with the content they are watching through interactive product
features like FanView, an in-video experience showcasing live game,
team and player stats and scores in real time. Fubo was also the
first virtual MVPD to enable simultaneous viewing of up to four
live channels (Multiview on Apple TV) as well the first to stream
in 4K HDR.
Ranked #1 in Customer Satisfaction among Live TV Streaming
Providers by J.D. Power (2022), Fubo has been called “a force in
sports streaming” by Forbes, “the best streaming service for sports
aficionados” by Tom’s Guide and was heralded by CNET for its “ease
of use.” Learn more at https://fubo.tv.
Basis of Presentation – Continuing
Operations
In connection with the dissolution of Fubo Gaming, Inc. and
termination of Fubo Sportsbook in October 2022, the assets and
liabilities and the operations of our former wagering reportable
segment have been presented as discontinued operations in our
consolidated financial statements. With respect to our continuing
operations, we operate as a single reportable segment. Financial
information presented in this release reflects Fubo’s results on a
continuing operations basis, which excludes our former wagering
reportable segment. Prior periods have been recast to conform to
this presentation.
Key Performance Metrics and Non-GAAP
Measures
Paid Subscribers
We believe the number of paid subscribers is a relevant measure
to gauge the size of our user base. Paid subscribers is defined as
total subscribers that have completed registration with Fubo, have
activated a payment method (only reflects one paying user per
plan), from which Fubo has collected payment from in the month
ending the relevant period. Users who are on a free (trial) period
are not included in this metric.
Average Revenue per User (ARPU)
Beginning in the third quarter of 2022, Average Revenue Per User
(ARPU) is calculated using Subscription revenue and Advertising
revenue on a GAAP basis. Previously, ARPU was calculated using
Platform Bookings, which consisted of Subscription revenue and
Advertising revenue, adjusted for deferred revenue.
We believe ARPU provides useful information for investors to
gauge the revenue generated per subscriber on a monthly basis.
ARPU, with respect to a given period, is defined as total
Subscription revenue and Advertising revenue recognized in such
period, divided by the average daily paid subscribers in such
period, divided by the number of months in such period. Advertising
revenue, like Subscription revenue, is primarily driven by the
number of subscribers to our platform and per-subscriber viewership
such as the type of, and duration of, content watched on platform.
We believe ARPU is an important metric for both management and
investors to evaluate the Company’s core operating performance and
measure our subscriber monetization, as well as evaluate unit
economics, payback on subscriber acquisition cost and lifetime
value per subscriber. In addition, we believe that presenting a
geographic breakdown for North America ARPU and ROW ARPU allows for
a more meaningful assessment of the business because of the
significant differences in both Subscription revenue and
Advertising revenue generated on a per subscriber basis in North
America when compared to ROW due to our current subscription
pricing models and advertising monetization in the two geographic
regions.
Adjusted EBITDA
Adjusted EBITDA is a non-GAAP measure defined as Net Loss from
Continuing Operations, adjusted for depreciation and amortization,
stock-based compensation, income tax benefit, other expenses, and
one-time non-cash expenses.
Gross Profit and Gross Margin (GAAP)
Gross Profit is defined as Revenue less Subscriber related
expenses and Broadcasting and transmission. Gross Margin is defined
as Gross Profit divided by Revenue. We believe these measures are
useful because they represent key profitability metrics for our
business and are used by management to evaluate the performance of
our business, including measuring the cost to deliver our product
to subscribers against revenue.
Free Cash Flow
Free Cash Flow is a non-GAAP measure defined as net cash used in
operating activities - continuing operations, reduced by capital
expenditures (consisting of purchases of property and equipment and
capitalization of internal use software). We believe Free Cash Flow
is an important liquidity measure of the cash that is available,
after capital expenditures, for operational expenses, investments
in our business, strategic acquisitions, and for certain other
activities such as repaying debt obligations and stock repurchases.
Free Cash Flow is a key financial indicator used by management.
Free Cash Flow is useful to investors as a liquidity measure
because it measures our ability to generate or use cash. The use of
Free Cash Flow as an analytical tool has limitations due to the
fact that it does not represent the residual cash flow available
for discretionary expenditures. Because of these limitations, Free
Cash Flow should be considered along with other operating and
financial performance measures presented in accordance with
GAAP.
Reconciliation of Non-GAAP Financial
Measures
Certain measures used in this release, including Adjusted EBITDA
and Free Cash Flow, are non-GAAP financial measures. We believe
these are useful financial measures for investors as they are
supplemental measures used by management in evaluating our core
operating performance. Our non-GAAP financial measures have
limitations as analytical tools and you should not consider them in
isolation or as a substitute for an analysis of our results under
GAAP. There are a number of limitations related to the use of these
non-GAAP financial measures versus their nearest GAAP equivalents.
First, these non-GAAP financial measures are not a substitute for
GAAP financial measures. Second, these non-GAAP financial measures
may not provide information directly comparable to measures
provided by other companies in our industry, as those other
companies may calculate their non-GAAP financial measures
differently.
The following table includes a reconciliation of the non-GAAP
financial measures used in this press release to their most
directly comparable GAAP financial measure.
fuboTV Inc.
Reconciliation of GAAP Subscription and
Advertising Revenue to North America ARPU
(in thousands, except average
subscribers and average per user amounts)
Year-over-Year Comparison
Three Months Ended
June 30, 2023
June 30, 2022
As-Reported
As-Reported
Subscription Revenue (GAAP)
$ 288,994
$ 199,943
Advertising Revenue (GAAP)
23,070
22,020
Subtract:
ROW Subscription Revenue
(7,906)
(5,540)
ROW Advertising Revenue
(250)
(303)
Total
303,908
216,120
Divide:
Average Subscribers (North America)
1,241,218
997,979
Months in Period
3
3
North America Monthly Average Revenue
per User (NA ARPU)
$ 81.62
$ 72.19
fuboTV Inc.
Reconciliation of Net Loss from
Continuing Operations to Non-GAAP Adjusted EBITDA
(in thousands)
Year-over-Year Comparison
Three Months Ended
June 30, 2023
June 30, 2022
As-Reported
As-Reported
Reconciliation of Net Loss from
Continuing Operations to Adjusted EBITDA
Net loss from continuing
operations
$ (54,209)
$ (94,964)
Depreciation and amortization
8,913
8,410
Stock-based Compensation
13,057
12,864
Other expense
1,815
3,935
Income tax benefit
(121)
(355)
Adjusted EBITDA
(30,545)
(70,110)
fuboTV Inc.
Reconciliation of Net Cash Used in
Operating Activities - Continuing Operations to Free Cash
Flow
(in thousands)
Year-over-Year Comparison
Three Months Ended
June 30, 2023
June 30, 2022
As-Reported
As-Reported
Net cash used in operating activities -
continuing operations
$ (71,028)
$ (83,430)
Subtract:
Purchases of property and equipment
(165)
(164)
Capitalization of internal use
software
(4,588)
(923)
Free Cash Flow
(75,781)
(84,517)
Cautionary Note Regarding
Forward-Looking Statements
This press release contains forward-looking statements of FuboTV
Inc. (“Fubo”) that involve substantial risks and uncertainties. All
statements contained in this press release that do not relate to
matters of historical fact are forward-looking statements within
the meaning of The Private Securities Litigation Reform Act of
1995, including statements regarding our business strategy and
plans, market opportunity, our financial condition, our anticipated
financial performance, our anticipated cash requirements, our
expectations regarding profitability and becoming cash flow
positive in 2025. The words “could,” “will,” “plan,” “intend,”
“anticipate,” “approximate,” “expect,” “potential,” “believe” or
the negative of these terms or other similar expressions are
intended to identify forward-looking statements, although not all
forward-looking statements contain these identifying words. Actual
results or events could differ materially from the plans,
intentions and expectations disclosed in the forward-looking
statements that Fubo makes due to a number of important factors,
including but not limited to the following: our ability to achieve
or maintain profitability; risks related to our access to capital
and fundraising prospects to fund our financial operations and
support our planned business growth; our revenue and gross profit
are subject to seasonality; our operating results may fluctuate;
the long-term nature of our content commitments; our ability to
renew our long-term content contracts on sufficiently favorable
terms; our ability to effectively manage our growth; our ability to
attract and retain subscribers; obligations imposed on us through
our agreements with certain distribution partners; we may not be
able to license streaming content or other rights on acceptable
terms; the restrictions imposed by content providers on our
distribution and marketing of our products and services; our
reliance on third party platforms to operate certain aspects of our
business; risks related to our reporting obligations; risks related
to the difficulty in measuring key metrics related to our business;
risks related to preparing and forecasting our financial results;
risks related to the highly competitive nature of our industry;
risks related to our technology, as well as cybersecurity and data
privacy-related risks; risks related to ongoing or future legal
proceedings; and other risks, including the effects of industry,
market, economic, political or regulatory conditions, future
exchange and interest rates, and changes in tax and other laws,
regulations, rates and policies. Further risks that could cause
actual results to differ materially from those matters expressed in
or implied by such forward-looking statements are discussed in our
Quarterly Report on Form 10-Q for the quarter ended March 31, 2023
filed with the Securities and Exchange Commission (“SEC”), our
Quarterly Report on Form 10-Q for the quarterly period ended June
30, 2023 to be filed with the SEC, and our other periodic filings
with the SEC. We encourage you to read such risks in detail. The
forward-looking statements in this press release represent Fubo’s
views as of the date of this press release. Fubo anticipates that
subsequent events and developments will cause its views to change.
However, while it may elect to update these forward-looking
statements at some point in the future, it specifically disclaims
any obligation to do so. You should, therefore, not rely on these
forward-looking statements as representing Fubo’s views as of any
date subsequent to the date of this press release.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230804450210/en/
Investor Alison Sternberg, Fubo asternberg@fubo.tv JCIR
for Fubo ir@fubo.tv Media Jennifer L. Press, Fubo
jpress@fubo.tv Bianca Illion, Fubo billion@fubo.tv
fuboTV (NYSE:FUBO)
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