- FuboTV topped analyst expectations with 20% revenue growth and single-digit subscriber growth
- But on an earnings call, analysts still questioned the viability of its business
- Fubo's CEO said a sluggish ad market dinged its Q3 revenue growth
Virtual pay TV company FuboTV defied analyst expectations, posting a 20% uptick in third-quarter revenue to $386.21 million and narrowing its net loss from continuing operations to $54.7 million versus $84.4 million a year ago.
Subscribers were up 6% year over year, too, to 1.99 million. (You can read Fubo’s full Q3 earnings release here.)
Wall Street’s reaction? Fubo stock was down more than 10% as of mid-day trading Friday. The cratering ended a solid October rally for Fubo, which saw its share price increase by 24% in October on the New York Stock Exchange.
The scene was reminiscent of Roku’s Q3 earnings report earlier in the week. The streaming platform giant also touted impressive gains across key performance indicators, but got smacked with an after-hours stock cratering of more than 10%.
For its part, New York-based Fubo still insists that the Holy Grail of profitability will arrive in 2025. But make no mistake that life can be challenging in the here and now for publicly traded streaming companies that aren’t yet making money.
At one point during Friday’s call with equity analysts, Needham & Company’s Laura Martin asked Fubo CEO David Gandler if this whole virtual MVPD gambit was even a viable business.
Gandler insisted that vMPVD’s are still a thing, citing data from MoffettNathanson showing that 30% of refugees from linear cable/satellite/telco pay TV fled over the past year to virtual pay TV services including Fubo, YouTube TV, Hulu+ Live TV and Sling TV.
“We continue to be encouraged by a quickly maturing streaming market and our ability to deliver on consumer needs,” Gandler said.
Maybe it’s the pace of growth that investors are uneasy with? Last year during the July to September period, Fubo declared revenue growth of 43%, more than double what it posted for the recent quarter.
Gandler attributed the slowing to a softer U.S. advertising market, as well as Discovery-Scripps channels being pulled off the Fubo programming grid.
Despite the rough treatment by Wall Street Friday, Fubo’s third quarter was still marked by a number of big wins, certainly not least among them a New York judge’s granting of the company’s request that a preliminary injunction be slapped on rival sports streaming joint venture Venu Sports.
Gandler couldn’t discuss details of the anti-trust suit against JV partners Disney, Fox and Warner Bros. Discovery, but he did say he looks forward to the matter going to trial in October 2025.