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FuboTV crosses 1.1M paid subs, just ahead of guidance

FuboTV's preliminary subscriber results in the fourth quarter of 2021 outpaced its year-ago totals, enabling the OTT-TV service to beat year-end guidance. However, the pace of growth in Q4 2021 fell behind its pace in the prior quarter.

In prelim Q4 2021 results announced Monday, the sports-oriented virtual multichannel video programming distributor (vMVPD) said it expected to end 2021 with more than 1.1 million paid subs – just a tick ahead of prior guidance of between 1.06 million and 1.07 million.

The prelim total suggests that FuboTV added at least 155,395 paid subscribers in Q4 2021, handily beating the 92,800 it added in the year-ago quarter. But the Q4 result fell short of the 262,884 net subs added in Q3 2021, when new subscribers stream in during the starts of the college football and National Football League seasons.

FuboTV's sub total keeps the service within the echelon of top vMVPDs. YouTube TV and Hulu (SVOD +Live TV) lead the way with about 4 million subscribers each, followed by Dish Network's Sling TV (2.56 million).

The growth of vMVPD services has failed to make up for the losses incurred by traditional cable, telco and satellite TV providers. According to MoffettNathanson, US pay-TV subscriber losses ballooned to 637,000 in the third quarter of 2021, as traditional pay-TV providers losses of 1.61 million subs dwarfed the gain of 980,000 subscribers by vMVPDs.

The vMVPD conversion rate (the rate at which traditional video subs are recaptured by vMVPDs) dropped to 31.4% in Q3 2021, versus 36.1% in the year-ago quarter, according to MoffettNathanson.

Revenues also beat guidance, but shares fall

Among other prelim Q4 2021 results, FuboTV said revenues are expected to be in the range of $215 million to $220 million, up 105% to 109% year-over-year. Prior guidance was a range of $205 million to $210 million. The company expects to end 2021 with $375 million of cash, cash equivalents and restricted cash.

Full-year 2021 revenues are expected to be $622 million to $627 million, ahead of prior guidance of $612 million to $617 million.

FuboTV said subscriber acquisition costs are expected to be at the low end of the company's target range of 1.0-1.5x monthly average revenue per user for the quarter, with churn improving by more than 200 basis points year-over-year. The fourth quarter of 2021 will mark the service's 13th consecutive quarter of churn improvements, the company said.

But those results weren't enough to impress investors. FuboTV shares were down 91 cents (6.51%) to $13.06 each in Monday morning trading.

Elsewhere, the company noted it's pushing forward with the integration of Molotov, a Paris-based live streaming platform aquired in December 2021. Linked to FuboTV's international expansion strategy, Molotov, which had about 4 million monthly active users at last check, operates under a "freemium" business model that features a baseline free tier alongside premium add-on channel packages. However, Molotov has not been drama-free – the service, following a November 2020 court ruling, was forced to pay almost $8 million for allegedly distributing M6 Group content without authorization.

Fubo Gaming, a unit of FuboTV, launched its online sportsbook late last year. Following an initial launch in Iowa last November, Fubo Gaming recently added Arizona as its second sportsbook market. FuboTV hopes to differentiate its pay-TV service by integrating in its sportsbook and mixing in a range of prediction-style, free-to-play games.

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— Jeff Baumgartner, Senior Editor, Light Reading

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