Release Date: August 06, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- FuboTV Inc (FUBO, Financial) reported a 26% year-over-year increase in total revenue for North America, reaching $382.7 million.
- The company achieved a 24% year-over-year growth in paid subscribers in North America, totaling 1.45 million.
- Ad revenue grew by 14% year-over-year, ending the quarter at $25.8 million.
- FuboTV Inc (FUBO) made significant strides towards profitability, with improvements in net loss, adjusted EBITDA, and free cash flow.
- The company repurchased $46.9 million of convertible debt at an average price of 56.6% of par value, enhancing financial flexibility and reducing outstanding debt.
Negative Points
- The potential impact of the sports streaming joint venture between The Walt Disney Company, Fox Corp., and Warner Bros. Discovery remains uncertain and could affect future profitability.
- Despite the growth, the ad revenue increase of 14% year-over-year was slower compared to previous quarters.
- The company faces ongoing litigation related to the sports streaming joint venture, which could have financial and operational implications.
- Subscriber growth in the rest of the world was only 2%, significantly lower than North America's 24% growth.
- The company continues to operate at a net loss, with a Q2 net loss of $25.8 million, although this is an improvement from the previous year.
Q & A Highlights
Q: Could you give us an update on what's happening with cost per thousand (CPM) and the general ad market for FuboTV?
A: John Janedis, CFO: We posted 13-14% growth in ad revenue, which was consistent with our two-year growth rate. CPMs in the sports marketplace remain strong, while there's some pressure on entertainment CPMs.
Q: Can you discuss your advertising performance and subscription retention expected around the Olympics?
A: David Gandler, CEO: We're pleased with our ad performance, especially in categories like auto, e-commerce, and financial services. For the Olympics, we don't aggressively pursue short-term event subscribers as they tend to have lower retention.
Q: Can you provide more details on the Free service and its impact on churn and retention?
A: David Gandler, CEO: It's early, but we're seeing encouraging trial usage and ad growth. We're focused on retaining churned customers and may expand the Free service to other cohorts soon.
Q: What were the key drivers behind the strong net subscriber additions in North America?
A: David Gandler, CEO: Key drivers included major sporting events, better-than-expected churn, and effective marketing strategies. We also saw strong performance from regional sports networks and cricket championships.
Q: How do connected TV options from OEMs like Vizio and Walmart impact your total addressable market (TAM)?
A: David Gandler, CEO: We see these OEMs as potential partners rather than competitors. Our service's ability to work seamlessly across different devices in a household is a key differentiator.
Q: What are your expectations for subscriber retention after major sporting events, and do you have enough capital to reach break-even?
A: David Gandler, CEO: Retention efforts are ongoing, and we expect some churn but also reactivation for future sports events. John Janedis, CFO: We believe we are funded to execute our operating plan, excluding the potential impact of the joint venture.
Q: Will your marketing approach change in the second half of the year, and do you have pricing power?
A: John Janedis, CFO: We have some pricing power, as evidenced by our recent price increases. Our marketing strategy will adjust to drive subscribers, but specifics will be shared in the next earnings call.
Q: Can you quantify the impact of removing Warner Brothers content on subscriber-related expenses?
A: John Janedis, CFO: We saw significant improvement in subscriber-related expenses, driven by a combination of content negotiations and mix-shift opportunities, not just the removal of Warner Brothers content.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
