fuboTV(US:FUBO) Benzinga·2025-11-04 20:43Core Viewpoint - FuboTV exceeded expectations in Q3 with strong subscriber growth and a return to positive adjusted EBITDA, but stock performance weakened due to price-sensitive growth impacting ARPU and concerns over 2026 forecasts following the Hulu + Live TV merger [1][3]. Financial Performance - FuboTV reported revenue of $377.2 million, a 2% decrease year-over-year but 7% above Needham's estimate, and adjusted EBITDA of $6.9 million, compared to a $27.6 million loss in the previous year, significantly outperforming the firm's estimate of a $6.7 million loss [2]. - The company’s current ARPU stands at $95, with a long-term goal of $100, and EBITDA margins are around 20%, aiming for 30% in the future [4]. Subscriber Growth and Strategy - FuboTV launched a new $55/month super-skinny bundle to address price sensitivity, with promotional pricing at $45, and reported no cannibalization of existing customers [5]. - North American paid subscribers reached 1.63 million, reflecting a 1.2% year-over-year increase, with churn reduced by approximately 50% [5]. Advertising Revenue and International Expansion - Advertising revenue decreased by 6% to $25.4 million but exceeded forecasts by 22%, with North American ads down 7% and international ads up 70% [6]. - Fubo plans to integrate its Molotov service in France and collaborate with Disney to leverage Disney+'s 100 million international subscribers, aiming to create a global sports and live TV streaming platform [7]. Strategic Value and Financial Modeling - Needham views Fubo's sports-first positioning and skinny bundle model as providing strong strategic value, with Disney's majority ownership reducing financial risk while maintaining upside potential [8]. - Needham's price forecast of $4.25 is based on a 10-year Discounted Cash Flow model, assuming 10.9% annual EBITDA growth over the next decade [8]. Future Projections - For fiscal 2025, Needham projects revenue of $1.57 billion with an earnings per share of 40 cents and adjusted EBITDA of $30.4 million, while fiscal 2026 estimates have been lowered to $1.56 billion in revenue and a loss of 15 cents per share [9].