CORPORATE GOVERNANCE

FuboTV Puts Gambling Plans On Hold As It Reviews Options

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By Stuart Thomson

Streaming provider FuboTV is pulling back from its ambition to develop an integrated streaming and gambling offering, despite growing its North American paid subscriber base by 41% year-on-year to 946,735 at the end of the second quarter.

International paying subs in France and Spain, including France’s Molotov, numbered 347,000.

While the international numbers were ahead of expectations, CEO David Gandler and chairman Edgar Bronfman Jr. admitted that the North American numbers “came under pressure primarily due to underperformance of specific sports content during a typically low-growth part of the year”.

Nevertheless, revenue from North America was US$216.1 million, up 65%, including US$21.7 million in ad revenue. Revenue from international operations was US$5.8 million.

The impressive revenue figures helped boost FuboTV’s share price in after-hours trading.

In their letter to shareholders, Gandler and Bronfman said that FuboTV would “refine and adjust our business” to reflect the changing economic environment, characterised by a rising cost of capital.

“We see meaningful opportunities to continue to reduce internal costs as well as to drive improvement of content-related unit economics. We are continuing to work towards materially growing our high margin advertising revenue. We believe in this economic environment that cord cutting will only increase and that Fubo will continue to benefit from this accelerating trend,” the pair said.

Integrating gambling with the sports streaming experience is a key part of the sports-focused FuboTV’s forward strategy, but the outfit’s leaders said in their letter that, having “evaluated how best to scale these capabilities in today’s market”, the company is no longer looking to “pursue this opportunity on our own” and that it had placed the interactive wagering business “under strategic review”.

“We are in internal and external discussions to determine the best path forward for Fubo’s gaming business and look forward to sharing more information,” said Gandler and Bronfman.

FuboTV turned in a net loss of US$116.3 million that included a US$10.7 million goodwill impairment charge associated with its gaming business, attributed to the decline in the company’s market capitalisation.

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