Let’s get straight to the point: FuboTV faces significant challenges, but there’s reason to believe they can turn things around. Here’s why.
Current Earnings Landscape
Fubo’s recent earnings report was less than encouraging, with current and forward earnings reflecting struggles in terms of ad growth and subscriber growth. The primary competitor, YouTubeTV, is making significant gains, leveraging features like MultiView, NFL Sunday Ticket at a deep discount, and a ton of channels like TNT and Discovery, that Fubo simply does not have.
However, the big win in earnings was that they had -1M in Free Cash Flow, which is incredible!!
Strategic Cutbacks
Fubo has had to implement cutbacks to address its financial losses, a painful process that comes at the cost of growth. This includes dropping discovery channels, which seems to have hurt the current subscribers and subscriber growth.
However, Fubo secured a preliminary injunction against major sports media companies Disney, Fox, and Warner. This legal victory likely foreshadows their eventual win against them in court in October 2025. Where I think Fubo will win billions in damages.
A Trial Will Is A Game-Changer
If Fubo prevails in court, the implications could be transformative. They would likely achieve instant profitability, potentially gaining over a billion dollars to buy back shares. This influx of capital could elevate their share price, allowing for potential share dilution at a much higher price.
Innovative Features and Competitive Edge
Fubo is not standing still; they’re also rolling out interactive features, including polls and games during sports broadcasts. David Gandler just mentioned this at the conference called "Gamification".
This could enhance viewer engagement, but all these small innovations won't matter until they win the lawsuit and can compete with offering amazing complete sports content.
The Potential Collapse of Google
It’s worth noting that Google is embroiled in its own antitrust lawsuit, which could affect the landscape for Fubo. Despite their struggles with channel offerings, the potential shift in sports broadcasting rights—such as the NBA moving to NBC and Amazon—could alleviate some of the pressure on Fubo next year. We need to closely watch how this plays out. The collapse of Google could be icing on the cake.
Conclusion
In summary, FuboTV is grappling with channel limitations and fierce competition from YouTubeTV, whose strategies raise concerns about monopoly practices. However, there’s a HUGE chance of a turnaround. With a successful outcome in their upcoming lawsuit, Fubo could not only achieve profitability but also rebrand and foster subscriber growth.
For now, shareholders need to sit tight and be patient. The potential for a turnaround is highly likely, but we need to wait till 2025, as this trial plays out!!