fuboTV(US:FUBO)2025-03-03 21:10PART I Item 1. Business Fubo is a sports-first live TV streaming platform, leveraging content and tech for subscriber growth and monetization, recently announcing a business combination with Disney and Hulu - Fubo's mission is to aggregate premium sports, news, and entertainment content into a single app, aiming to transcend the current TV model26 - The core business model is 'come for the sports, stay for the entertainment,' leveraging sports to acquire subscribers efficiently, then using technology and data to drive engagement and monetize through subscription fees and digital advertising3731 - On January 6, 2025, Fubo entered a business combination agreement with Disney and Hulu, forming 'Newco,' where Hulu will hold a 70% economic and voting interest, with Fubo holding 30%3334 Paid Subscribers (as of December 31) | Region | 2024 (millions) | 2023 (millions) | Change (YoY) | |:---|:---|:---|:---| | North America | 1.7 | 1.6 | +0.1 | | Rest of World | 0.362 | 0.406 | -0.044 | | Total | 2.062 | 2.006 | +0.056 | Average Revenue Per User (ARPU) (Years Ended December 31) | Region | 2024 | 2023 | Change (YoY) | |:---|:---|:---|:---| | North America ARPU | $85.97 | $82.25 | +$3.72 | | Rest of World ARPU | $7.49 | $6.82 | +$0.67 | Our Mission Fubo's mission is to aggregate premium sports, news, and entertainment content into a single app, redefining traditional TV - Fubo aims to aggregate premium sports, news, and entertainment content through a single app to transcend the current TV model26 Overview Fubo is a sports-first, Pay TV replacement platform using proprietary tech and data to enhance user experience and advertising - Fubo is a sports-first, Pay TV replacement product offering live and on-demand sports, news, and entertainment content27 - The platform utilizes proprietary technology and first-party data to personalize content discovery, enhance user experience, and improve advertising capabilities2930 - The majority of Fubo's revenue in 2022, 2023, and 2024 was generated from subscription services and advertising sales in the United States, with operations also in Canada, Spain, and France31 Recent Developments — Business Combination Fubo announced a business combination with Disney and Hulu on January 6, 2025, forming Newco with Hulu holding a 70% interest - Fubo entered a business combination agreement with Disney and Hulu on January 6, 2025, to form a new entity, Newco33 - Hulu will contribute assets related to its 'Hulu + Live TV' service to Newco, gaining a 70% economic and voting interest, while Fubo will hold a 30% interest33 - The completion of the Business Combination is contingent on several conditions, including shareholder approval, regulatory clearances, and the absence of prohibitive laws34 Industry Overview The streaming industry is growing rapidly as consumers shift from traditional Pay TV, creating opportunities for comprehensive replacements - Streaming services are rapidly growing as consumers cut the cord from traditional Pay TV, favoring superior customer experience, competitive pricing, and better value35 - Sports and news content, traditionally a stronghold of Pay TV, are now a key driver for streaming platforms like Fubo to offer a compelling Pay TV replacement36 Our Business Model Fubo's model focuses on acquiring subscribers via sports, driving engagement with tech, and monetizing through subscriptions and advertising - Fubo's business model is centered on acquiring subscribers via sports content, enhancing engagement through technology and data, and increasing Average Revenue Per User (ARPU) via subscriptions and advertising37 - The company's core strategies include growing its paid subscriber base, optimizing content and retention, and increasing monetization through subscription and advertising41 Our Offerings Fubo offers flexible subscription packages with 100+ channels, providing value to advertisers and content providers through engaged audiences - Fubo offers flexible subscription packages with over 100+ channels, including top Nielsen-rated networks and Regional Sports Networks (RSNs), with optional 'Attachments' for customization38 - The platform provides advertisers with a growing, engaged live audience and unskippable ad inventory, leveraging innovative ad formats and data for measurability and relevancy39 - Content providers benefit from Fubo's platform by monetizing and distributing their content to a highly engaged audience, counteracting shrinking viewership in traditional Pay TV40 Seasonality Fubo experiences significant seasonality, with higher revenue and subscriber growth in Q3 and Q4 driven by major sports and holiday advertising - Fubo generates significantly higher revenue and subscriber additions in the third and fourth quarters, driven by the National Football League and college football seasons41 - Operating results can also be affected by non-annual major sporting events (e.g., World Cup, Olympics) and typically see a decline in total subscribers from Q4 to Q1/Q241 Our Growth Strategies Fubo's growth strategies focus on expanding subscribers, increasing ARPU via pricing and advertising, optimizing content, and international expansion - Fubo aims to efficiently grow its subscriber base, which reached approximately 1.7 million in North America and 362,000 in Rest of World as of December 31, 202442 - ARPU expansion efforts include price increases, attachment sales, and advertising revenue growth, with North America ARPU at $85.97 in 2024 (vs. $82.25 in 2023) and Rest of World ARPU at $7.49 in 2024 (vs. $6.82 in 2023)42 - The company plans further investment in its advertising sales team, technology, and infrastructure, leveraging data to deliver relevant advertising and improve campaign optimization, with advertising revenue approximately $115.2 million in 2024, a slight decrease from $115.4 million in 202342 - Other strategies include enhancing the content portfolio with cost vigilance, investing in technology and data capabilities (e.g., MultiView, AI, Molotov integration), and expanding international operations in Canada, Spain, and France42 Intellectual Property Fubo protects its intellectual property through patents, trademarks, copyrights, and licenses, holding multiple patents and trademarks globally - Fubo relies on a combination of patent, trademark, copyright, and other intellectual property laws, confidentiality agreements, and license agreements to protect its rights43 - As of December 31, 2024, Fubo had five issued U.S. utility patents, five granted foreign utility patents, and eighteen granted foreign design registrations45 - The company also held thirty-seven registered trademarks globally, including 'fuboTV' in the United States and the European Union46 Competition Fubo operates in a highly competitive TV streaming market, competing with traditional and virtual providers based on content, features, and pricing - The TV streaming market is highly competitive, with Fubo competing against traditional Pay TV operators (e.g., DirecTV, Comcast) and vMVPDs (e.g., YouTube TV, Hulu + Live TV, Sling TV)47 - Competition is based on content offerings (especially live sports), platform features, user experience, brand awareness, and value proposition48 - Fubo also competes for advertisers with other streaming platforms and traditional media, emphasizing its ability to provide a large, engaged audience and innovative ad formats49 Our People and Human Capital Management Fubo prioritizes its 590 global employees, investing in talent development, competitive compensation, and health and safety programs - As of December 31, 2024, Fubo had approximately 590 employees globally, with 400 in North America and 190 in Europe and India52 - The company focuses on talent development, ongoing learning, and fostering engagement and transparency through training programs, all-hands meetings, and newsletters53 - Fubo offers competitive compensation packages, including base salary, performance-based cash bonuses, and equity awards, along with a variety of benefits like 401(k) and health insurance55 Government Regulation Fubo is subject to various domestic and foreign regulations, with high and increasing compliance costs and potential business impacts - Fubo is subject to numerous domestic and foreign laws and regulations covering user privacy, data protection, consumer protection, and Internet-delivered streaming services57 - Compliance costs are high and likely to increase, with potential for significant liabilities and penalties if laws and regulations are not met57 Data Protection and Privacy Fubo is subject to evolving global data protection and privacy laws, with non-compliance risking reputational and financial harm - Fubo is subject to various laws and regulations governing the collection, use, and security of personal information, which are rapidly evolving in the U.S. and internationally58 - Any actual or perceived failure to comply with these requirements could lead to investigations, fines, and adverse effects on reputation and financial condition58 Corporate Information FuboTV Inc., incorporated in 2009 and renamed in 2020, has its principal executive offices in New York - FuboTV Inc. was incorporated in 2009 and changed its name to fuboTV Inc. on August 10, 202060 - The company's principal executive offices are located at 1290 Avenue of the Americas, New York, NY60 Available Information Fubo provides investor information, including SEC filings and reports, on its Investor Relations website and through public announcements - Fubo provides investor information, including SEC filings, on its Investor Relations website (ir.fubo.tv)61 - Material information is disseminated through SEC filings, the investor relations website, press releases, and social media (X, Instagram, Facebook, LinkedIn) to ensure broad, non-exclusionary distribution62 Item 1A. Risk Factors Fubo faces risks from operating losses, capital needs, seasonality, intense competition, content acquisition, the Disney/Hulu combination, and regulatory and IP challenges - Fubo has incurred operating losses and expects to continue doing so, potentially requiring additional capital that may not be available on acceptable terms6566 - Revenue is subject to seasonality, with higher levels in Q3 and Q4 due to sports, making results difficult to predict and potentially harming the business if subscriber behavior falls below expectations6970 - The TV streaming market is highly competitive, with many large technology and entertainment companies, posing challenges for Fubo to differentiate itself and attract/retain subscribers141142144 Risks Related to Our Financial Position and Capital Needs Fubo faces risks from ongoing losses, capital needs, revenue seasonality, substantial debt, and limitations on net operating loss carryforwards - Fubo has incurred net losses from inception, with a net loss from continuing operations of $177.8 million for the year ended December 31, 2024, and expects future operating expenses to increase65 - The company may require additional capital for business growth, platform enhancements, marketing, and international expansion, which might not be available on acceptable terms or could dilute existing shareholders6667 Outstanding Indebtedness (as of December 31, 2024) | Debt Type | Principal Amount (millions) | |:---|:---| | 2026 Convertible Notes | $144.8 | | 2029 Convertible Notes | $177.5 | | Other notes | $8.1 | | Total Outstanding Indebtedness | $330.3 | - Fubo's revenue is subject to seasonality, with significantly higher revenue and subscriber additions in Q3 and Q4, primarily driven by the National Football League and college football69 - As of December 31, 2024, Fubo had federal net operating loss carryforwards of approximately $1,458.4 million, but their utilization may be limited by Section 382 of the Internal Revenue Code due to ownership changes7172 Risks Relating to the Business Combination The Disney/Hulu Business Combination faces risks of non-completion, termination fees, business uncertainties, and Fubo's post-combination dependence on Newco distributions - The Business Combination is subject to several closing conditions, including shareholder and regulatory approvals, and may not be completed on the contemplated terms or timeline, or at all8485 - Failure to complete the Business Combination could result in Fubo paying a $50 million termination fee and increased volatility or decline in its stock price86 - Post-Business Combination, Fubo will be a holding company dependent on distributions from Newco to pay taxes and expenses, including substantial payments to Hulu under a Tax Receivables Agreement949599 Risks Related to Our Relationships with Content Providers, Customers and Other Third Parties Fubo's business relies heavily on content providers and third parties, facing risks from content commitments, renewal terms, subscriber retention, and cloud service dependency - Long-term content commitments may limit operating flexibility and adversely affect liquidity if subscriber acquisition and retention do not meet expectations104106 - Fubo's ability to attract and retain subscribers is impacted by its capacity to provide compelling content at competitive prices, and the loss of popular content or channels could harm the business108109110 - The company relies on Google Cloud Platform (GCP) and Amazon Web Services (AWS) for critical operations, and any disruption or competitive action by these providers could adversely impact Fubo's business131 - Agreements with certain distribution partners may contain parity obligations, limiting Fubo's ability to pursue unique partnerships or offer differentiated features across platforms114 Risks Related to Our Financial Reporting and Disclosure Fubo faces financial reporting risks from internal control weaknesses, metric inaccuracies, and potential impairment of goodwill or long-lived assets - Failure to maintain an effective system of internal controls over financial reporting could lead to a loss of investor confidence and adverse effects on Fubo's stock price132133 - Key metrics (e.g., ARPU, subscribers) and financial forecasts are subject to inherent measurement challenges and estimates, and inaccuracies or failure to meet guidance could cause the stock price to decline134135138 - Impairment in the carrying value of goodwill or long-lived assets, which Fubo has experienced in prior periods, could negatively affect operating income and net assets139140 Risks Related to Our Products and Technologies and Competition Fubo faces intense competition, relies on OTT advertising and technology (including AI), and risks product failure, inaccuracy, and evolving regulatory scrutiny - The TV streaming market is highly competitive, with Fubo competing against well-resourced companies that can subsidize services, making subscriber acquisition and retention challenging141142144 - Fubo's future growth depends on the acceptance and growth of OTT advertising and its ability to expand content beyond its primary live sports streaming reputation146147148 - The company utilizes AI and machine learning technologies, which present risks such as inadequate design, biased data, and evolving regulatory landscapes (e.g., EU AI Act), potentially affecting business efficiency and financial results158159160 - Fubo ceased its Fubo Sportsbook operations in October 2022, but past involvement in sports wagering exposed it to complex and evolving gaming laws, with potential for future claims or adverse regulatory changes153154 Risks Related to Regulation Fubo is subject to diverse regulations (Internet, privacy, tax), with changes potentially increasing costs, altering business models, or causing penalties - Fubo is subject to general business regulations and laws specific to the Internet and television broadcasting, including those related to user privacy, data protection, and consumer protection164 - Potential expansion of FCC regulations to vMVPDs, stricter consumer protection laws (e.g., California's Automatic Renewal Law), and evolving international tax laws could increase compliance costs and impact business operations165167172 - The company faces risks related to payment processing, potential fines from the IRS for delinquent tax filings, and sales/similar tax collection obligations in various jurisdictions168169170 Risks Related to Our Operations Fubo's operations face risks from legal proceedings, customer support quality, third-party reliance, international expansion, economic conditions, and strategic transactions - Fubo is subject to legal proceedings, including past class action lawsuits and antitrust claims (e.g., against Disney, Fox, WBD), which can lead to unforeseen expenses and divert management's time174175176 - The company's ability to attract and retain subscribers depends on adequate customer support, which relies on managing and training third-party BPO providers177 - International expansion plans in Canada, Spain, and France subject Fubo to economic, political, and regulatory risks, including differing legal requirements, competitive pressures, and currency fluctuations178179180 - Worldwide economic conditions, including inflation, can adversely affect advertising spending and consumer subscription levels, impacting Fubo's financial performance186187 Risks Related to Privacy, Consumer Protection and Cybersecurity Fubo faces extensive privacy, consumer protection, and cybersecurity risks, with non-compliance or breaches potentially causing significant costs and reputational harm - Fubo is subject to various international, federal, and state laws (e.g., CCPA, GDPR, VPPA) governing personal information processing, with increasing scrutiny and potential for significant compliance costs and liabilities192193195 - The company's information technology systems and third-party cloud services are vulnerable to cybersecurity threats, including cyber-attacks, malware, and data breaches, which could lead to service disruptions, data loss, or intellectual property theft203204 - Despite a cybersecurity risk management program, the evolving nature of threats means Fubo may be unable to anticipate or prevent all unauthorized access, potentially resulting in legal claims, regulatory actions, and reputational harm206 Risks Related to Our Intellectual Property Fubo faces IP litigation risks, relies on third-party licenses, and risks diminished brand value from inadequate protection or open-source software limitations - Fubo could face costly intellectual property litigation, including claims of patent, trademark, or copyright infringement, which may divert resources and restrict its ability to use current technology or market its service209210 - The company's ability to stream content relies on obtaining licenses from content providers and rights holders, and an inability to secure these on favorable terms could harm its business211213214 - Inadequate protection of Fubo's patents, trade secrets, trademarks, and copyrights could diminish the value of its brand and intangible assets, while the use of open-source software may impose limitations on commercialization215216217218 Risks Related to the 2026 Convertible Notes Fubo risks default on 2026 Convertible Notes due to insufficient funds, with conversion features impacting liquidity and accounting affecting EPS - Fubo may not have sufficient cash or financing to settle conversions or repurchase its 2026 Convertible Notes upon a fundamental change or at maturity, potentially leading to default220221 - The conditional conversion feature, if triggered, could adversely affect liquidity by requiring cash payments222 - The accounting method for convertible debt (ASU 2020-06) requires the 'if-converted' method, which could adversely affect diluted earnings per share223 Risks Related to the 2029 Convertible Notes Fubo risks default on 2029 Convertible Notes, with conversion features impacting liquidity and indenture provisions restricting financial flexibility - Fubo may not have the ability to raise funds necessary to settle conversions or repurchase its 2029 Convertible Notes upon a fundamental change or at maturity, risking default225226 - The conditional conversion feature, if triggered, could adversely affect liquidity and potentially reclassify the outstanding principal as a current liability227 - The 2029 notes indenture and Exchange Agreement restrict Fubo's operating and financial flexibility, including limitations on incurring additional secured indebtedness and certain business transactions229230231 Risks Related to Ownership of our Common Stock Fubo's common stock faces high volatility, potential dilution from future sales, and no anticipated cash dividends, requiring reliance on price appreciation - The market price of Fubo's common stock is subject to wide fluctuations due to macroeconomic conditions, operating results, competition, and technical trading factors233 - Future sales of substantial amounts of common stock by existing shareholders or through additional equity issuances could cause the stock price to decline and dilute existing ownership234238 - Fubo does not anticipate declaring cash dividends in the foreseeable future, meaning investors must rely on stock price appreciation for future gains237 General Risk Factors General risks include inadequate insurance coverage and negative impacts from limited or adverse analyst coverage on stock performance - Fubo's insurance may not provide adequate coverage against all claims, and losses could exceed policy limits, adversely affecting business240 - Limited analyst coverage or adverse/misleading research reports could negatively impact Fubo's stock price and trading volume239 Item 1B. Unresolved Staff Comments No unresolved staff comments to report Item 1C. Cybersecurity Fubo implements an ISO 27001-based cybersecurity program with board oversight, risk assessments, and an incident response plan - Fubo's cybersecurity risk management program is based on the ISO 27001 framework and integrated into its enterprise risk management, with no identified material threats as of the report date242244 - Key elements include risk assessments, a dedicated security team, use of external providers, security tools, employee training, and an incident response plan244 - The Board of Directors delegates cybersecurity risk oversight to the Audit Committee, which receives quarterly reports from management and internal cybersecurity personnel245246 Cybersecurity Risk Management and Strategy Fubo's ISO 27001-guided cybersecurity program includes risk assessments, a security team, and an incident response plan, with no material threats identified - Fubo's cybersecurity risk management program is designed and assessed based on the ISO 27001 framework and other industry standards242 - Key elements include risk assessments, a security team, external service providers, security tools, employee training, and an incident response plan244 - As of the report date, Fubo has not identified any cybersecurity threats that have materially affected its operations, business strategy, results, or financial condition244 Cybersecurity Governance The Board delegates cybersecurity oversight to the Audit Committee, with management and a dedicated committee responsible for risk assessment - The Board of Directors delegates cybersecurity risk oversight to the Audit Committee, which receives quarterly reports from management and internal cybersecurity personnel245246 - The management team, including the CFO, CLO, and CTO, is responsible for assessing and managing cybersecurity threats and oversees the overall cybersecurity risk management program247 - A Cybersecurity Governance Committee, comprising leadership from various corporate functions, meets quarterly to align on security decisions, review metrics, and assess security enhancements248 Item 2. Properties Fubo's headquarters are in New York, occupying 55,000 sq ft, with other global leased spaces deemed adequate - Fubo's worldwide corporate headquarters are in New York, New York, occupying 55,000 square feet under a lease expiring in 2035249 - The company also leases various office and shared workspaces throughout the United States and internationally, deeming current facilities suitable for its needs249 Item 3. Legal Proceedings Fubo is involved in a patent lawsuit, recently settled an antitrust case for $220.0 million, and reached an agreement in principle for VPPA class actions - Fubo is defending against a patent infringement lawsuit filed by DISH Technologies, LLC, which is currently stayed pending inter partes review by the PTAB251253254 - On January 6, 2025, Fubo settled its antitrust lawsuit against Disney, Fox, and WBD, receiving an aggregate cash payment of $220.0 million and agreeing to dismiss the lawsuit with prejudice256 - The company is a defendant in putative class action complaints under the Video Privacy Protection Act (VPPA) and has reached an agreement in principle to resolve these matters on a class basis257 Item 4. Mine Safety Disclosures This item is not applicable PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Fubo's common stock trades on NYSE under 'FUBO,' with 288 holders of record, and no cash dividends are anticipated - Fubo's common stock trades on the New York Stock Exchange under the symbol 'FUBO'261 - As of February 28, 2025, there were 288 holders of record of the company's common stock261 - Fubo has not declared or paid any cash dividends on its common stock and intends to retain future earnings for business operations and expansion262 Market Information Fubo's common stock is listed and traded on the New York Stock Exchange under 'FUBO' - Fubo's common stock trades on the New York Stock Exchange under the symbol 'FUBO'261 Holders of Record As of February 28, 2025, Fubo had 288 holders of record for its common stock - As of February 28, 2025, there were 288 holders of record of Fubo's common stock261 Dividend Policy Fubo has not paid cash dividends and plans to retain future earnings for business expansion, with no dividends anticipated - Fubo has not declared or paid any cash dividends on its common stock and does not anticipate paying any in the foreseeable future262 - The company intends to retain future earnings, if any, to finance the operation and expansion of its business262 Recent Sales of Unregistered Securities; Purchases of Equity Securities by the Issuer or Affiliated Purchasers No recent sales of unregistered securities or equity purchases by the issuer or affiliated purchasers are reported - There were no recent sales of unregistered securities or purchases of equity securities by the issuer or affiliated purchasers263 Stock Performance Graph This section presents a stock performance graph comparing Fubo's common stock against industry indices from October 2020 to December 2024 - The report includes a stock performance graph comparing Fubo's common stock against the Russell 3000 Index and the S&P Media and Entertainment Index from October 8, 2020, to December 31, 2024265 Item 6. [Reserved] This item is reserved and contains no information Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations Fubo's 2024 financial results show increased revenue, reduced operating loss, and improved gross profit, driven by subscription growth and strategic management of costs and liquidity Consolidated Revenues (in thousands) | Revenue Type | 2024 | 2023 | Change (YoY) | |:---|:---|:---|:---| | Subscription | $1,500,101 | $1,249,579 | +$250,522 | | Advertising | $115,200 | $115,370 | -$170 | | Other | $7,495 | $3,276 | +$4,219 | | Total Revenues | $1,622,796 | $1,368,225 | +$254,571 | Key Financial Performance (in thousands) | Metric | 2024 | 2023 | Change (YoY) | |:---|:---|:---|:---| | Operating Loss | $(196,021) | $(289,350) | +$93,329 | | Net Loss from Continuing Operations | $(177,778) | $(293,102) | +$115,324 | | Gross Profit | $203,900 | $86,100 | +$117,800 | | Gross Margin | 12.6% | 6.3% | +6.3 pp | | Net Loss | $(176,091) | $(287,917) | +$111,826 | Paid Subscribers (as of December 31) | Region | 2024 (millions) | 2023 (millions) | Change (YoY) | |:---|:---|:---|:---| | North America | 1.7 | 1.6 | +0.1 | | Rest of World | 0.4 | 0.4 | 0 | | Total | 2.1 | 2.0 | +0.1 | Average Revenue Per User (ARPU) (Years Ended December 31) | Region | 2024 | 2023 | Change (YoY) | |:---|:---|:---|:---| | North America ARPU | $85.97 | $82.25 | +$3.72 | | Rest of World ARPU | $7.49 | $6.82 | +$0.67 | Overview Fubo is a sports-first streaming platform monetizing subscriptions and advertising in North America and internationally, having ceased sportsbook operations - Fubo is a sports-first, cable TV replacement streaming platform for sports, news, and entertainment, with revenues primarily from subscriptions and advertising in the U.S., Canada, Spain, and France271273 - The business model leverages sporting events for subscriber acquisition, uses technology and data for engagement, and monetizes through higher average revenue per user (ARPU)272 - Fubo ceased operation of its online mobile sportsbook, Fubo Sportsbook, in October 2022, with its results presented as discontinued operations275 Recent Developments - Business Combination Fubo announced a business combination with Disney and Hulu on January 6, 2025, forming Newco with Hulu holding a 70% interest - Fubo entered a business combination agreement with Disney and Hulu on January 6, 2025, to form 'Newco,' with Hulu holding a 70% economic and voting interest and Fubo holding 30%276 - The transaction involves Hulu contributing assets related to its 'Hulu + Live TV' service and Fubo undergoing an Up-C Reorganization276 - Completion of the Business Combination is subject to several closing conditions, including shareholder and regulatory approvals277 Segments Fubo now operates as a single reportable segment for its continuing streaming operations after ceasing Fubo Sportsbook - Fubo operates as a single reportable segment for its continuing operations, following the dissolution of Fubo Gaming and termination of Fubo Sportsbook278 Key Factors and Trends Impacting Performance Fubo's performance is influenced by brand awareness, subscriber trends, cord-cutting, ad spend shifts, content costs, seasonality, and macroeconomic factors - Key factors impacting performance include brand awareness, subscriber acquisition and retention, and the ongoing trend of cord-cutting from traditional Pay TV to streaming services279280281 - The shift of advertising budgets from traditional Pay TV to Connected TV is crucial for Fubo's business model, but its growth depends on advertisers perceiving meaningful benefits of OTT advertising282 - Content acquisition and renewal costs are the largest component of operating expenses, and increases or unfavorable terms could pressure margins, with seasonality, driven by sports, and macroeconomic factors also significantly affecting results284285286 Components of Results of Operations Fubo's results comprise subscription, advertising, and other revenues, various operating expenses, and other income/expense, with discontinued operations reported separately - Revenues are categorized into Subscription (from plans sold via website and app stores), Advertising (fees for ad impressions), and Other (distribution, commissions, carriage fees)288289290 - Operating expenses include subscriber related expenses (affiliate distribution rights, content streaming costs), broadcasting and transmission, sales and marketing, technology and development, general and administrative, depreciation and amortization, and impairment of other assets291292293294295296297 - Other income (expense) covers interest, debt premium/discount amortization, and gains/losses on debt extinguishment, with income tax provision/benefit and net income/loss from discontinued operations also reported298299300 Results of Operations for the Years Ended December 31, 2024, and 2023 In 2024, Fubo's total revenues increased to $1,622.8 million, operating loss decreased to $(196.0) million, and net loss improved to $(177.8) million Consolidated Statements of Operations (in thousands) | Metric | 2024 | 2023 | Change (YoY) | |:---|:---|:---|:---| | Total Revenues | $1,622,796 | $1,368,225 | +$254,571 | | Operating Expenses | $1,818,817 | $1,657,575 | +$161,242 | | Operating Loss | $(196,021) | $(289,350) | +$93,329 | | Total Other Income (Expense) | $18,902 | $(4,631) | +$23,533 | | Net Loss from Continuing Operations | $(177,778) | $(293,102) | +$115,324 | | Net Income (Loss) from Discontinued Operations | $1,687 | $5,185 | -$3,498 | | Net Loss | $(176,091) | $(287,917) | +$111,826 | - Subscription revenue increased by $250.5 million, driven by a $171.8 million increase in subscriber base and a $78.7 million increase from subscription package prices and attachments302 - Subscriber related expenses increased by $147.7 million due to higher affiliate distribution rights and other distribution costs from increased subscribers and contractual rates303 - Broadcasting and transmission expenses decreased by $10.9 million due to cloud infrastructure optimization initiatives304 - General and administrative expenses increased by $10.8 million, primarily due to a $23.9 million increase in legal fees, partially offset by a $12.1 million reduction in indirect tax accruals307 Key Performance Metrics Fubo monitors Paid Subscribers, ARPU, Gross Profit, and Gross Margin, reporting 1.7 million North America subscribers and $85.97 ARPU in 2024 - Paid subscribers are defined as total subscribers who have completed registration, activated a payment method, and from whom Fubo has collected payment in the month ending the relevant period315 Paid Subscribers (as of December 31) | Region | 2024 (millions) | 2023 (millions) | |:---|:---|:---| | North America | 1.7 | 1.6 | | Rest of World | 0.4 | 0.4 | - ARPU is calculated as total Subscription and Advertising revenue divided by average daily paid subscribers and then by the number of months in the period317 Average Revenue Per User (ARPU) (Years Ended December 31) | Region | 2024 | 2023 | |:---|:---|:---| | North America ARPU | $85.97 | $82.25 | | Rest of World ARPU | $7.49 | $6.82 | Gross Profit and Gross Margin (Years Ended December 31, in thousands) | Metric | 2024 | 2023 | |:---|:---|:---| | Gross Profit | $203,900 | $86,100 | | Gross Margin | 12.6% | 6.3% | Liquidity and Capital Resources Fubo's liquidity is supported by revenue and financing, with $167.6 million cash as of December 2024, bolstered by recent debt management and a $220.0 million litigation settlement - Fubo's primary cash sources are subscription and advertising revenue, along with equity and debt financings325 - As of December 31, 2024, cash, cash equivalents, and restricted cash totaled $167.6 million329 - During 2024, Fubo repurchased $46.9 million of 2026 Convertible Notes for $27.1 million and exchanged $205.8 million of 2026 notes for $177.5 million of 2029 Convertible Notes326 - In January 2025, Fubo received a $220.0 million cash payment from an antitrust litigation settlement and secured a commitment for a $145.0 million senior unsecured term loan from a Disney affiliate327 - The company believes its existing cash and cash equivalents provide necessary liquidity for at least the next twelve months but may seek additional capital through its ATM program or other means329331 Cash Flows In 2024, net cash used in operating activities decreased to $75.6 million, while financing cash flow significantly decreased due to lower ATM proceeds Cash Flows (in thousands) | Activity | 2024 | 2023 | |:---|:---|:---| | Net cash used in operating activities (continuing) | $(75,627) | $(173,045) | | Net cash used in investing activities (continuing) | $(15,835) | $(25,417) | | Net cash provided by financing activities (continuing) | $11,465 | $111,233 | | Net cash used in operating activities (discontinued) | $(3,851) | $(4,577) | | Net decrease in cash, cash equivalents and restricted cash | $(83,848) | $(91,806) | - The decrease in net cash used in operating activities was primarily due to a decrease in net loss and an increase in cash receipts from accounts receivables, partially offset by increased payments for programming license fees333 - The decrease in net cash provided by financing activities was driven by lower proceeds from the ATM Program, repurchases of convertible notes, and payments for financing costs335 Critical Accounting Policies and Estimates Fubo's critical accounting policies involve significant estimates for business combinations, goodwill, intangible assets, and stock-based compensation - Business combinations require significant estimates for fair value allocation of acquired assets and liabilities, and useful lives of intangible assets338 - Goodwill is tested for impairment annually or when triggering events occur, involving subjective estimates of reporting unit fair value339340341 - Intangible assets are amortized over estimated useful lives and reviewed for impairment if circumstances indicate non-recoverability342343 - Stock-based compensation fair value is estimated using the Black-Scholes option-pricing model for options and fair value of common stock for restricted stock units, requiring complex judgments and assumptions344346 Recently Issued Accounting Pronouncements Refer to Note 3 of the consolidated financial statements for recent accounting policies and pronouncements - Refer to Note 3 in the consolidated financial statements for details on recently issued accounting pronouncements351 Item 7A. Quantitative and Qualitative Disclosures About Market Risk Fubo faces market risks from interest rates and foreign currency, but a hypothetical 10% change would not materially impact its financial statements - Fubo is exposed to market risks from changes in interest rates and foreign currency352 - As of December 31, 2024, Fubo had $167.6 million in cash, cash equivalents, and restricted cash, primarily in money market funds, and $330.3 million in fixed-rate outstanding indebtedness353 - A hypothetical 10% change in interest rates or a 10% weakening of the Euro and Canadian dollar would not have a material impact on Fubo's consolidated financial statements353354 Interest Rate Risk Fubo's interest rate risk from cash equivalents and fixed-rate debt is not material, with no derivative use - As of December 31, 2024, Fubo had $167.6 million in cash, cash equivalents, and restricted cash, primarily invested in money market funds353 - The company's outstanding indebtedness of $330.3 million as of December 31, 2024, bears interest at a fixed rate353 - A hypothetical 10% change in interest rates would not have a material impact on Fubo's consolidated financial statements353 Foreign Currency Risk Fubo's foreign currency risk is limited, with non-U.S. dollar revenues at 2.2% in 2024, and no material impact from a 10% currency weakening - Revenues denominated in currencies other than the U.S. dollar accounted for approximately 2.2% of consolidated revenue for the year ended December 31, 2024354 - Fubo's most significant currency exchange rate exposures are the Euro and the Canadian dollar354 - A hypothetical 10% weakening of the Euro and Canadian dollar relative to the U.S. dollar would not have resulted in a material impact on Fubo's consolidated financial statements354 Item 8. Financial Statements and Supplementary Data This item refers to appended financial statements and supplementary data, indexed in Item 15 of Part IV - The financial statements required by this item are appended to the Annual Report, with an index in Item 15 of Part IV355 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure No changes in or disagreements with accountants on accounting and financial disclosure are reported - This item is not applicable, indicating no changes in or disagreements with accountants on accounting and financial disclosure356 Item 9A. Controls and Procedures Fubo's management concluded disclosure controls and internal control over financial reporting were effective as of December 31, 2024, with no material changes - As of December 31, 2024, Fubo's management concluded that its disclosure controls and procedures were effective at the reasonable assurance level359 - Management assessed and concluded that the company's internal control over financial reporting was effective as of December 31, 2024, based on the 2013 COSO framework360 - KPMG LLP, the independent registered public accounting firm, issued an unqualified opinion on the effectiveness of Fubo's internal control over financial reporting as of December 31, 2024363364 - There were no material changes in internal control over financial reporting during the quarter ended December 31, 2024370 Limitations on effectiveness of controls and procedures Management acknowledges that controls provide only reasonable assurance due to inherent limitations and resource constraints - Management recognizes that controls and procedures can only provide reasonable assurance due to inherent limitations and resource constraints358 Evaluation of Disclosure Controls and Procedures Fubo's officers concluded disclosure controls and procedures were effective at a reasonable assurance level as of December 31, 2024 - Fubo's principal executive officer and principal financial officer concluded that disclosure controls and procedures were effective at the reasonable assurance level as of December 31, 2024359 Report of Management on Internal Controls over Financial Reporting. Management concluded Fubo's internal control over financial reporting was effective as of December 31, 2024, based on the COSO framework - Management is responsible for internal control over financial reporting and concluded it was effective as of December 31, 2024, based on the 2013 COSO framework360 Audit Report of Independent Registered Public Accounting Firm KPMG LLP issued an unqualified opinion on Fubo's internal control over financial reporting and consolidated financial statements as of December 31, 2024 - KPMG LLP issued an unqualified opinion on the effectiveness of Fubo's internal control over financial reporting as of December 31, 2024363 - KPMG also expressed an unqualified opinion on the consolidated financial statements for the three-year period ended December 31, 2024364 Item 9B. Other Information No other information is required, with no Rule 10b5-1 trading arrangement adoptions or terminations reported - No director or officer adopted or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement during the three months ended December 31, 2024371 Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections This item is not applicable - This item is not applicable372 PART III Item 10. Directors, Executive Officers and Corporate Governance Fubo's Board adopted a Code of Business Conduct, with further information incorporated from the 2025 proxy statement - Fubo has a written Code of Business Conduct and Ethics applicable to all officers, directors, and employees, available on its investor relations website375 - Further information for this item will be incorporated by reference from the definitive proxy statement for the 2025 Annual Meeting of Shareholders376 Item 11. Executive Compensation Executive compensation information will be incorporated by reference from the 2025 Annual Meeting of Shareholders proxy statement - Executive compensation information will be incorporated by reference from the definitive proxy statement for the 2025 Annual Meeting of Shareholders377 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Security ownership information for beneficial owners and management will be incorporated by reference from the 2025 proxy statement - Information on security ownership of beneficial owners and management will be incorporated by reference from the definitive proxy statement for the 2025 Annual Meeting of Shareholders378 Item 13. Certain Relationships and Related Transactions, and Director Independence Information on related transactions and director independence will be incorporated by reference from the 2025 proxy statement - Information on certain relationships, related transactions, and director independence will be incorporated by reference from the definitive proxy statement for the 2025 Annual Meeting of Shareholders379 Item 14. Principal Accountant Fees and Services Principal accountant fees and services information will be incorporated by reference from the 2025 proxy statement - Information on principal accountant fees and services will be incorporated by reference from the definitive proxy statement for the 2025 Annual Meeting of Shareholders380 PART IV Item 15. Exhibits and Financial Statement Schedules This section lists financial statements (pages F-1 to F-47) and provides an index of exhibits, including key agreements and certifications - The financial statements are included on pages F-1 through F-47 of the Annual Report383 - All financial statement schedules are omitted as the information is either not required or presented in the consolidated financial statements or notes384 - A list of exhibits filed includes the Business Combination Agreement, Articles of Incorporation, debt indentures (2026 and 2029 Convertible Notes), equity incentive plans, and various certifications385386387388 Item 16. Form 10-K Summary No Form 10-K Summary is provided - No Form 10-K Summary is provided389 FINANCIAL STATEMENTS Report of Independent Registered Public Accounting Firm KPMG LLP issued an unqualified opinion on Fubo's 2024 financial statements and internal controls, noting subscriber-related expenses as a critical audit matter - KPMG LLP issued an unqualified opinion on Fubo's consolidated financial statements for the three-year period ended December 31, 2024401 - KPMG also expressed an unqualified opinion on the effectiveness of Fubo's internal control over financial reporting as of December 31, 2024402 - A critical audit matter was the sufficiency of audit evidence over subscriber-related expenses, specifically affiliate distribution rights, due to subjective judgment in evaluating subscriber data completeness and accuracy406407 Consolidated Balance Sheets As of December 31, 2024, Fubo reported total assets of $1,077.4 million, with decreased liabilities and shareholders' equity due to an accumulated deficit Consolidated Balance Sheet Highlights (in thousands) | Metric | December 31, 2024 | December 31, 2023 | Change | |:---|:---|:---|:---| | Cash and cash equivalents | $161,435 | $245,278 | $(83,843) | | Total current assets | $274,033 | $386,754 | $(112,721) | | Total assets | $1,077,428 | $1,232,640 | $(155,212) | | Total current liabilities | $515,322 | $517,345 | $(2,023) | | Convertible notes, net | $332,383 | $391,748 | $(59,365) | | Total liabilities | $896,646 | $948,815 | $(52,169) | | Accumulated deficit | $(2,017,796) | $(1,845,542) | $(172,254) | | Total shareholders' equity | $180,782 | $283,825 | $(103,043) | Consolidated Statements of Operations and Comprehensive Loss In 2024, Fubo's total revenues increased to $1,622.8 million, with operating loss and net loss from continuing operations significantly improving Consolidated Statements of Operations (in thousands) | Metric | 2024 | 2023 | 2022 | |:---|:---|:---|:---| | Subscription Revenue | $1,500,101 | $1,249,579 | $905,886 | | Advertising Revenue | $115,200 | $115,370 | $101,739 | | Total Revenues | $1,622,796 | $1,368,225 | $1,008,696 | | Total Operating Expenses | $1,818,817 | $1,657,575 | $1,420,553 | | Operating Loss | $(196,021) | $(289,350) | $(411,857) | | Total Other Income (Expense) | $18,902 | $(4,631) | $(14,854) | | Net Loss from Continuing Operations | $(177,778) | $(293,102) | $(425,045) | | Net Income (Loss) from Discontinued Operations | $1,687 | $5,185 | $(136,874) | | Net Loss | $(176,091) | $(287,917) | $(561,919) | | Basic and Diluted Loss Per Share | $(0.54) | $(1.04) | $(3.08) | Consolidated Statements of Shareholders' Equity Fubo's shareholders' equity decreased to $180.8 million in 2024, primarily due to net loss and foreign currency adjustments, partially offset by stock issuance Shareholders' Equity Highlights (in thousands) | Metric | December 31, 2024 | December 31, 2023 | |:---|:---|:---| | Common Stock (shares) | 339,144,854 | 299,215,160 | | Common Stock (amount) | $34 | $30 | | Additional Paid-In Capital | $2,219,002 | $2,136,870 | | Accumulated Deficit | $(2,017,796) | $(1,845,542) | | Accumulated Other Comprehensive Income (Loss) | $(4,870) | $4,218 | | Non-controlling Interest | $(15,588) | $(11,751) | | Total Shareholders' Equity | $180,782 | $283,825 | - Net loss attributable to common shareholders was $(172.3) million in 2024422 - Proceeds from common stock issuance (at-the-market offering) were $43.3 million in 2024422 Consolidated Statements of Cash Flows In 2024, net cash used in operating activities decreased to $75.6 million, while financing cash flow significantly decreased due to lower ATM proceeds and note repurchases Consolidated Statements of Cash Flows (in thousands) | Activity | 2024 | 2023 | 2022 | |:---|:---|:---|:---| | Net cash used in operating activities (continuing) | $(75,627) | $(173,045) | $(289,786) | | Net cash used in investing activities (continuing) | $(15,835) | $(25,417) | $(5,987) | | Net cash provided by financing activities (continuing) | $11,465 | $111,233 | $296,270 | | Net cash used in operating activities (discontinued) | $(3,851) | $(4,577) | $(26,915) | | Net decrease in cash, cash equivalents and restricted cash | $(83,848) | $(91,806) | $(32,854) | | Cash, cash equivalents and restricted cash at end of period | $167,572 | $251,420 | $343,226 | - The decrease in net cash used in operating activities was primarily due to a decrease in net loss and an increase in cash receipts from accounts receivables, partially offset by an increase in payments for programming license fees333 - The decrease in net cash provided by financing activities was primarily driven by lower proceeds from the ATM Program, repurchases of outstanding convertible notes, and payments for financing costs335 Notes to the Consolidated Financial Statements The notes detail Fubo's organization, liquidity, accounting policies, and financial performance, including revenue, expenses, assets, liabilities, and subsequent events - Fubo is a live TV streaming platform for sports, news, and entertainment, with revenues primarily from subscriptions and advertising in North America and international markets433434 - The company has incurred losses and negative cash flows from operating activities since inception, with an accumulated deficit of $2,017.8 million as of December 31, 2024436 - Fubo's liquidity is supported by cash, cash equivalents, and proceeds from equity and debt financings, including recent repurchases of convertible notes and a $220.0 million litigation settlement in January 2025436437 Note 1 - Organization and Nature of Business FuboTV Inc., incorporated in 2009, operates a live TV streaming platform, generating revenue from subscriptions and advertising globally - FuboTV Inc. was incorporated in 2009 and changed its name to fuboTV Inc. on August 10, 2020, with its common stock listed on the NYSE431 - The company's core business is a live TV streaming platform for sports, news, and entertainmen