FuboTV Inc. Q2 FY2025 earnings call

Key Points

• David highlighted that the second quarter was a milestone with first positive adjusted EBITDA. Global streaming business exceeded revenue and subscriber expectations.
• Pending business combination with Hulu+ Live TV, with anticipated closing in 4Q 2025 or 1Q 2026, subject to regulatory approvals, shareholder approval, etc.
• Upcoming launch of Fubo Sports, a skinny content service for sports fans. Recent launch of pay-per-view to offer flexible content experiences.
• Content partnership with DAZN in the U.S. expanded Fubo Sports Network's distribution, giving Fubo subscribers access to premium content.
• Personalized features like Catch Up To Live, Game Highlights, and Timeline Markers optimized live sports viewing.
• John discussed financial results exceeding guidance, net loss narrowing to $8 million, cash position over $285 million in cash, cash equivalents, and restricted cash.

In North America, total revenue was $371 million, down 3% year-over-year, with 1,356,000 paid subscribers, down 6.5% year-over-year. In the Rest of World, total revenue was $8.7 million, up 4.7% year-over-year, and paid subscribers were 349,000, down 12.5% year-over-year. The second quarter marked Fubo's first quarter of positive adjusted EBITDA, with adjusted EBITDA of $20.7 million, an improvement of over $30 million year-over-year.

Forward-Looking Statements

• Anticipated timeline to close the Hulu+ Live TV transaction is 4Q 2025 or 1Q 2026.
• Upcoming launch of Fubo Sports in the coming weeks.
• Expect seasonal uptick in subscribers with the fall sports season and focus on effective marketing in the third quarter.

Risks

• Closing of the Hulu+ Live TV transaction is subject to regulatory approvals, Fubo shareholder approval, and other customary closing conditions.
• Competitive environment may impact subscriber numbers and marketing efforts.
• Dependence on content partnerships and potential outcomes of negotiations with content providers like Univision.

Q: Congrats on the EBITDA profitability. Just in terms of the third quarter, can you maybe just talk about some of the puts and takes and how we should formulate subscriber expectations for the quarter, just with the launch of products from competitors and near expected launch of a skinnier product? And with the competitive environment, how should we think about like the marketing efforts both to support -- to support your service relative to the traditional seasonal pattern?

A: John mentioned July finished in line with expectations, expecting seasonal uptick with fall sports season and reactivations. David added focus on effective and efficient marketing in third quarter.

Q: So David, I would like to go to the French acquisition. And the industrial logic there were not only were they great tech guys, but we also have really great like a free streaming service, and you're going to try to bring some of that know-how into Fubo to offer free -- can you update us on what's happening with the French assets? And were they -- did it actually come true? Did it actually, actually help you? Because I can't -- you haven't done that much with free services in front of the paywall in the end, right? So can you update us on whether the logic sort of worked there? And if not, why not? And if so, how?

A: David said CTO led Molotov streaming platform was integrated, focused on unifying tech stack. In France, discussing sports properties, technology stack capable of handling multiple services, ad technology to be available to Molotov by end of 4Q 2025 or 1Q 2026.

Q: Congratulations on the positive EBITDA you printed in the quarter. So if I could, I'd like to start by asking about the ad trends in the quarter. Obviously, you had some nice uptick in the ad ARPU year-over-year. So that was really nice to see. I'm wondering if you've seen a slowdown in the ad bookings related perhaps to the tariff pressure on consumer brands. And if by what you surmised the Fubo Sports Network FAST channel is working to offset those trends, if that's the piece that's offsetting it or if there are other factors, if you could highlight those?

A: John said auto softness continued but not significant drag. Retail e-com and tech categories strong. FAST channels' dollars in mid- to high singles, growth in strong doubles, providing modest positive tailwind to ad growth.

Q: In absence of guidance this quarter, I was just kind of hoping to get your thinking around the directional trend for EBITDA from here. If we strip out some of the onetime costs that were in the quarter, we still land at a pretty good number. So I was just curious if this is maybe the new normal in terms of EBITDA profitability or if there are some seasonal fluctuations that we should keep in mind looking forward?

A: John stated the business is seasonal, with 2Q typically the strongest adjusted EBITDA quarter, and normal seasonal trends in profitability direction expected.

Q: A question either for David or John. Just interested in your take on the sub guide that -- the original sub guide for Q2 and then the revised sub guide a couple of weeks ago, what were the sort of puts and takes on that? And then a follow-up. In terms of these broad relationships that you have terminated over the last several quarters, where are we in terms of the arc of those like Univision? Where do you see that sort of annualizing?

A: John said came in 100,000 or so ahead of original guide, due to strong interest in Latino product post price reduction and better retention trends. David added about difficult year with content channel drops, strong conversion uptick on Latino packages, and situation is stable with advertising business stabilized, stand-alone offers and Fubo Sports in focus.