Earnings call transcript Q1 2023

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Operator

Good morning. My name is Chris and I will be your conference operator today. At this time, I'd like to welcome everyone to the Fubo Q1 2023 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. Instructions] [Operator

Sternberg, Relations, Alison may of SVP you. you Investor begin. Thank

Alison Sternberg

our CEO Relations discuss for shareholders, is found quarter and our John results joining are details you to management in Fubo. Fubo’s section CFO David Fubo; the website of Janedis, on us Co-Founder and today Thank letter of at me our be to first ir.fubo.tv. earnings which Full and and of can With year Gandler, Investor commentary additional of available XXXX. release

let we the going of cover the will Fubo’s Before turn to for brief start review today’s and presentation. me over John am Q&A. on begin, quickly with the the call the financials David quarter remarks analysts to year and format and and full is to guidance. going strategy I some Then

we the that anticipated our the laws, and remind ATM statements limited I following statements program. tax our would of to, discussion including, the Before like within to financial performance, forward-looking securities condition, anticipated federal not meaning contain everyone requirements, begin, but financial may regarding

and strategy These assumptions. to expectations and regarding risks, business statements are Our consumer subject behavior forward-looking certain uncertainties plans, and profitability.

could statements for our cause to Important factors filed the December be discussed with year from annual forward-looking SEC. XXst, results that ended materially include report differ the on actual XX-K in those Form XXXX to

to expectations us. our reflect current on currently based our and available statements These assumptions, beliefs, information

after statements call. expectations are reflect believe these undertake occur obligation revise Although we this to we no to changes that reasonable, any

former continuing historical a guidance as otherwise are presenting noted, are are results gaming operations on accounted which excluding as operations. results for basis, and the discontinued segment, we Except the of our today

also measures on Reconciliations non-GAAP which in we available also letter, is available GAAP to are our our call, measures these non-GAAP ir.fubo.tv. website the to financial XXXX QX shareholder most directly comparable earnings the During measures. refer of at

to will the call I turn over that, David. With

David Gandler

you total growth morning American on to good subscribers. exceeded year-over-year results. paid everyone. Fubo's strong and I'm business and quarter update in Fubo's North revenue pleased first double-digit streaming Alison you, Thank posting guidance,

million year-over-year subscribers, We $XXX.X with up closed the revenue, X.XXX quarter and up XX% million in year-over-year. XX%

of rest also business, the total French paid in double-digit and revenue quarter. Molotov, streaming posted during growth service subscribers world which our Our includes

healthy in XX% up and We delivered a revenue, up XX% XXX,XXX year-over-year million $X.X over subscribers, year-over-year. paid

Our QX revenue, flat year-over-year North $XX.X the in continued market. American despite pressure sales business ad million delivered advertising on remaining

second We the quarter. expect of a reacceleration growth in

to to are XXXX We announced we that cash flow continue at our report we that XXXX Day meaningfully positive very I'm toward targeting advance that Investor pleased in and goal.

reduced million and we publicly-traded in a quarter, This loss a company represents by first flow the In profitability $XX we've our year-over-year. by cash free been $XX absolute largest dollar year-over-year our milestone. and adjusted key since is EBITDA a improvement metric improved million

we usage and seasonal controlling in cash significant on continued Fubo continues measured improvement approach, XXXX. on similar a anticipate efficiently a in trajectory cash focus capital From through year-over-year XXXX, allocate particular usage. perspective, to in disciplined our to

until plan cash operating our in to achieve cash XXXX. that we balance of is million fund current sufficient believe $XXX.X We positive our flow

the million first the we in settled million our no current quarter. our under And we on which of program. quarter, outlook, net plans ATM the program, During $XXX.X from further $XXX.X market the in sell to raised based at proceeds have

user app. Fubo's single through for aggregation content experience, a a delivered Customers to continue demonstrate premium all model through their preference

ranks support why XXX growing month Fubo on with Our Number over platform Live market spend Customer Power. the coupled users Satisfaction our among JD in One Providers average, on by TV share every Streaming hours

the fans. with sports. Major for solid same now by coverage, and popular virtual more sports in expanded brand by that This professional competing Fubo's our to adding continuing the strengthened a we're MVPD streaming down differentiation Turning recently baseball is underscores dropped our double by proposition to content partnership on leader Fubo is League was content, Baseball.

smart We're push has for us ahead make live proprietary were years and with our product customer. MVPD also the and towards tech delivering continuing personalized every continuously a enabled the to virtual did our Fubo's boundaries to streaming. to eye launch investments stack with of first multi-view, TV product of We experience both one peers. XK we

details XXXX We more innovation forward set engage with purchase to months AI harnessing for transform proprietary coming plan DVR. and industry, the how We our sharing through video acquired of look computer technology the streaming our to and to vision standard are Edisn.ai. in we Continuing users in the traditional

user differentiation proposition. recent pay With of our as content on sports power. a underscoring and value more premium These increases negligible prices raised additions, had In supporting our will service plans. consumers pricing brand comes TV our channel and QX, impact our sports-first a we churn for result live and thesis experience for optimized and that premium early

double we than despite ongoing in growing first expected closing, digits marketplace. stronger had a quarter, In the challenges

continue is our our the on We monetization path invest experiences and focus always of and in profitability. engagement to to with optimizing goal levers custom ultimate

We positive continue believe demonstrate to the continued our towards sheet operational our flow and balance track advancement of strength record, our cash our key metrics clearly XXXX see the across our momentum we goal.

financial Janedis, results to turn the to John greater discuss call in detail. John? now will our I CFO over

John Janedis

everyone. morning, and David you, good Thank

our Our and against many reflect operating goals market first of quarter progress metrics. results key

to More importantly, we expect this continue. trend

for million, across XX% the growth North revenue record $XXX.X increased XX% XX% driven Rest revenue of a revenue to from growth World. Total by and America quarter

growth in increase XXX,XXX. to XX% subscribers topline in million, a of be $X.XXX a to Our with along Rest World driven increase subscribers America in by increases healthy to continues subscribers, including North XX%

deliver front revenue relatively with to America the $XX.XX. overall progress of We despite to headwinds million expansion are able were budgets, America, $XX.X X% in with flat across North year-over-year. ARPU pleased North our advertising monetization across on And remaining we the advertising

in XX% business, QX XXXX. including We're a positive million, gross the reduction million have improvement of progress operating in we also a X,XXX pleased a versus with resulted and $XX.X of out on and gross margin the the net $XX This loss profit XX%, the led basis the loss point a made negative prior of cost per a net of $X.XX compared loss net share a year-over-year quarter in of loss $X.XX to This negative in XXXX a favorably to of to compared first period. year first quarter margin and margin loss XXXX. a

from an adjusted compared loss improvement minus quarter resulted adjusted QX EPS in minus year period. margin loss loss EPS prior $X.XX loss in compared XXXX. in XX.X% to first the an EBITDA improved improvement EBITDA an XXXX $X.XX, an This quarter of in adjusted XX.X%, First million adjusted of to million of $XX.X was a of the a and $XX.X loss of to

expense path our we leverage to identify ongoing to efficiencies are Turning our profitability, to maximize each pleased operating and across category. with efforts

demonstrated prior we versus our leverage example, XXX% year subscriber For expenses, revenue decreased related from the which to XX% period. greater over QX XXXX in of

towards trend as we work our growing and premium to year-over-year our this optimizing expect continue pricing We improving meaningfully further of subscribers plans. mix

we as improve were cash year-over-year flow, million to cash $XX on expectation improve our XXXX to by year-over-year. flow continues free adjusted losses our to basis for flow a free represented we peak be cash believe will Accordingly, pleased EBITDA both Turning business. and that

sheet, of restricted equivalents, we balance cash, relates the and $XXX.X cash. ended cash it to As quarter our with million

and program, we in or settled in of our in $XXX.X the QX remainder During raised QX. which the million $XXX.X net from million proceeds at quarter, settled ATM the market

standpoint, highly investments Fubo structure in fund of a the disciplined and our From remain while financial growth cash, to capital we initiatives. also deployment disciplined and flexibility affording measured

operating is cash expense our are Importantly, planned balance current our given confident in that flow on cash we our investments, cash sufficient XXXX plan. and position achieve positive and to based

Moving of to guiding $XXX.X XX% expect year-over-year guidance, at XX% America's million at representing North are X.XX of second midpoint. growth And the midpoint. to representing to a $XXX.X revenue growth the X.XX quarter XXXX we subscribers million we million, million, year-over-year

now For XXXX North to the billion previous million, we year-over-year year growth full X.XX full midpoint XXXX revenue growth at at XXXX, midpoint. $X.XXX for X% XX% of X.XX billion, year of subscribers and million our the raising the to expect year guidance $X.XXX representing and representing year-over-year are full America

to XXX,XXX QX XX% our For growth rest to at and at representing XXX,XXX year-over-year the million projects growth million, XX% the guidance subscribers, $X.X XXXX $X.X midpoint. of midpoint revenue of world, year-over-year representing

year of by to XXX,XXX at to growth projects subscribers, the at the XXXX million revenue Note XXX,XXX XXXX XX% fourth Cup. of the representing year-over-year midpoint. X% $XX.X decline midpoint guidance the and was that Our a full impacted quarter World year-over-year number $XX.X Rest million, representing subscriber World

with Our ongoing guidance XXXX revenue growing ARPU improving on our growth. forecasted than economics unit more subscriber and Xx expanding QX and emphasis reflects

in our XXXX. performance pleased of And recent the focus continued our to business, of positive our we gross our achieve profit, the economics In flow our very expansion, summary, in remain our quarter unit and results confident reflects cash with streaming and cash usage. in margin are goal ability on

With question-and-answer session. call would the turn to over Operator? the now for that, I like the operator to

Operator

Instructions] Thank Laura Our question from you. [Operator with Martin Needham. is first

Your line is open.

Laura Martin

morning. you guys. let's increase. are numbers, In expected higher. January, the can aggressive with Because up-to-date sort with I on did start excellent. what's get these going churn to the talk Bright wouldn't increase, price numbers you price be guys Good David, you of churn? an your a about sub

David Gandler

look Well, Yes. of much, thank in you all, forward a first seeing to Lauren. I weeks. of very you couple

an with did would XX call things XX on I that really earnings last I -- we think $XX. the was that we days price it or say, fact think days, ups and be of -- that had addition, $X in I price had then up of there we were two focused we increase the one during the was would additional within

really expected happened. the think cohorts turn that call bit World we was significantly But typically we a NFL to the without conservative. the on into earnings were understanding RSNs, more last little cohort a concerned that sense cohort, about pace. going fate would so the And we greater what most of them and sort we the two the have the Cup were call had I of We at of which off mentioned

to those the RSNs people option the think that give we to on I us to stay have did an But the fact allowed platform.

stronger respect, the resulted so actually And that and stronger in into was much additions? the anticipated from fiber we that crossover than RSNs

John Janedis

Laura, is couple as well. of John. maybe I'd add This things a

up For QX, year-over-year modestly. we saw churn very

XXX thought it actually little could So, up was but than we points, tracked less have David's higher. bit the basis it a point,

terms that in a can quarter a it as is or potentially least a -- is out. of And now at couple we're months what a actually say we're year-over-year. at looking for always or And churn of call obviously two of quarter-to-date impact, churn tail I XQ, down

Laura Martin

us tell will your And you you can you and headlines won't about, the reading point a tell apart pulling tell I payment the on your RSN us bundle follow-up if but lot of on guys I all with view? and we're -- for Can the what's obligations you your us these I now ask those, Thank status advertising Helpful. paid RSN know question, comment. money rights my out what's Can of of teams you. a of RSN? falls from rights going

John Janedis

question. Good

a greatest number think few So, first had RSNs of set of independent well. we've now, the years, for all, the had as I we've of RSNs

we've to It launch a Boston And either [Indiscernible], seen of so us degree. same are regions in impacted service have such a direct-to-consumer services service. and really as planning other these hasn't direct-to-consumer to as the many or

And small significant remember very markets. of to amount markets difficult a generate small I think need it's are in that and just folks money these to very

Red you only so impact. continues as we way. there's think other there I individual that are deals are I'm our But we so Sox. the not with that strengthen to don't see on with And Diamond that Boston teams any relationship didn't Sports really sure

in As about payments have we the events occur. itself, certain the that right in relates but to allow talk place obviously, it can't there to reduce now, that there I are deal us provisions should deal

Baseball a So, been done very with job. great League happy and that from Major we've our perspective, also has

I the one in really rules, that's particularly is in thing change around other favor pitching the clock. think our worked pitching, the

strong And sort of all results. led some to combined of have these things

goal cost the create cash I'll price we've set subs, thing that say that given been to the entry what last we've in attractive from the think initially goal of was had to the we improvement, of out for. I And we've really reduce flow that the and deliver economics. user terms able achieved But free

Laura Martin

very Thank you much.

Operator

The is Evercore ISI. Shweta with next from question Khajuria

is open. Your line

Shweta Khajuria

flat you referring about know connected my year-over-year I'm And Okay. trends, Thanks just was overall please the are taking Could in demand TV the what talk demand environment. we trends? specifically hearing advertising I to question. despite it for

we But it's the season. -- also front new

you it particular you out whether you. can specific is And verticals call So, heard? of what What have categories for or top is out? mind that anything people? that jumps in Thank

John Janedis

with sure I'll Yes, that. Shweta. start

your flat of sort than our a I and acceleration finished go down give so mid-singles. perspective, around to we in better then And we're bit, ad numbers that, monthly was of categories. I'd through when looked me April it in if up you you the of into let now say and And From some the we talk seeing XQ call it, double-digits. I slightly, came better a then also January so and And is through results, revenue. XQ just that the on about was February, February, point, than March April, call further then flattish maybe which think I'll and in far at up March was QX January. some

trends. encouraged we're of seeing we're of the terms by So, what in some

in limited. visibility CPG, in the as quarter, strength say of softer in pharma, we insurance side, auto, expect, little and would also space. I then saw travel, we we're financials for some you then telecom a in may the strength financials, and And month on second it, then the in saw a perspective, the quarter, a as category weakness But now, pharma call a in retail. bit and in of From And QSR. weakness And then CPG seeing competitive. and bit and travel, retail, first

but would of incoming thing from to the and yet. have a second obviously would when still look, ad team agencies, quarter and I you from on say I'm we've One our sales talk it's to report the early. so sure also. nothing new dialogue ask I call. on we'll lot fronts, added initial more I'd encouraging say

Operator

with is The Aftahi Darren next from question ROTH MKM.

Your is open. line

Darren Aftahi

my for guys. Good Hey morning. Thanks taking questions.

efforts to Following your speak QX progress upon ad advertising, kind direct can as total is mix? of sales like there? you percentage of a What direct of kind in

David Gandler

an area going this said be focused Well, to is we Yes. we're that on.

it's small building small team. started our dramatically advertising overall It's about out of component And still the still direct, excited we the is so business I'm relatively this and why sales. advertising a

to gives a which not I'm in are year-over-year hours We've lot small, to that quite over opening me seen extremely ad XX% number, continue a viewership of viewing. going our revenue. drive also give to that my as to in it's helpful. increased are trends in There's comfort few that a going ability factors [Indiscernible] comments be by flat XXX about relatively said but despite we're that of

So, given We're broadcast and diluting comes hours from nets. and RNSs. more that of is broadcast hours and fact watching inventory number more that again that -- people the adding inventory we don't towards on the have RSNs watching the the creating

other fast in our working is is really favor which channels. The the component

cable we we our is know, the more which cases split twice XX-XX than a from get most you amount with partners, As channel in of inventory have the nets. fast

And X% that or sub upwards providing X% viewership despite avail. being of of in is terms X%

the May very team of to our lot think a Xrd and our with there's that will there. sorry, of products sponsorship And out I in So, focused at in there's market no, a of strong lot those was capabilities. buzz, presented lot just continuing fronts opportunity interest new ensure we're on a opportunities. yesterday it be We and develop -- sales and

through still very that which growth, not But from XXXX, continue very we'll given achieve our now comfortable to but in we numbers why are only early, today, targets. our where that profitability see I'm is process, ensuring

John Janedis

X would I add that. just And Darren, thing on

that or next direct the just assume we as beyond number couple of over growth a XXXX. into would direct, trends percentage, number And of percentage to terms year-over-year double-digits say was quarters I'd triple-digits. In the pure as that a say that

David Gandler

is so above the are that understands XX% XX% between CPM. typically importance programmatic and of CPMs that And Yes. everyone just

of very us in a component forward it's dor an So, going important area focus.

Darren Aftahi

Thanks. content inning how KPI? what chop of I If guys ROIs. on focused and I guess your by follow-up, items this I you looking is Thanks. costs, guess, we reducing pretty on to could that line can much at I been know one more there thing items are on more evaluating game in -- I have where line and wood and, SRE and

John Janedis

that's question. Darren, great a Well,

again, could Fubo very about I I is think wanting look, it telling because of more talking what potentially do. a -- going start of we history I'm to story keep

You've market grow us to seen content continue past and our the in drop share.

into continue moves. some going to we lot On going feel a that We are to And make XXXX, bold SRE that very line. there's room there. of

We're focus As going from to on to you line of revenue know, to now we've XX%. that. improved that continue XXX%

good discounts some chop to And there. see volume deals getting there's we're think well. we're We where starting as wood to

this that profitability in streaming. cable, complexity think is trend the coupled in with space the the achieving of in. We right we're Given

where They back They for be with in tremendous the major to media didn't of to and There's streaming amount theatrical. now to theatrical. want a wanted of go that lot Similar decided to a companies created partners theatrical like a product have right to ours. value media

very able very profitability now we're that confident focused. between and to impact of we'll positive We're So, have some target. our sort be

Operator

[Operator Instructions] is next Zangler with question The Stephens. Nick from

open. is line Your

Unidentified Analyst

Hey, appetite guys. noticing Fubo contextual ad Could platforms, the units on were or just This new and fronts us Nick. is? give ads the around interactive is or Dean maybe the unique just quarter. for Thanks. you Congrats on any on CTV We roadmap ads, targeting. emphasis color just shoppable in on what remind the on for

David Gandler

Yes.

early we So, advertising couple we scalable. this value right is on of isn't closely. of elements. we're serving now looking stuff But and at obviously, One focused this right platform, we're just which really is display -- a very in internal the the have we're realized lot stages A now messages. of of sort

ads us, any impact by Roku appealing quite the as it incremental seems and Roku's viewership. to sort us it the sellout next opportunity way doesn't video of versus at of does display look which our be the video, nor inventory for video we require But when to of levels

area So, first. we'll that's focus an

integrations on And Edisn.ai what's an in leverage data, contextually available potentially technology with that I vision to of on computer able obviously think to what then acquisition anonymized it's on then and be our obviously, our and that our basis. data we'll selling we're we're believe advertisers also are basis focused screen, then where pull beyond read going look people relevant. frame-by-frame to that, to begin watching on a But

value products. We think of and a of brand sales impact that will greater that direct probably terms have in

And so think stream you'd is problem stop to shoppable order video. TV that ads. with ads we'll and that live good be to I'm The experience. focused shoppable there sure with not a very I have somebody before the for in the interact that's

lot for But a products very career advertisers. here. screen team we perform throughout at ad very lucky strong a I've really second marketing and really that but looked have seen didn't of my sales, different cool, opportunities We're

to So, advertising as to opportunities we're capabilities, we sure think make about through typically we with that for our team advertising partners. talk marketing going create value our

XX from next So, packaging and brand you'll the brand provide to sort move awareness better to see into sales of a of over able greater us drive partners. being products and a ad six greater breadth months to for our

Unidentified Analyst

Got you. Thanks.

Operator

questions Sternberg. have by to We over further Alison it turn I'll phone.

Alison Sternberg

operator. you, Thank

Safe address questions And take As I any can these you. are of you from discuss investors. launches related is the them think combine horizon? handful both related growth? your or product of last actually updates long-term to through to in one, sort And new our to are quarter, a that, to what which for going I'm that Technologies so questions, we're came these going they're that that plans I'm into David, to on of going portal of

David Gandler

I daily. we These think would questions are say, Yes. about,

ultimate to That is we be a for our The first in thing that have goal goal. and set is most breakeven XXXX. ourselves important

cash second need that our The to burn. tied is that to we goal reduce

platform that areas calls. continuing short-term it to think we're because out I about, able several the at unified business through to important say to some scale on a we're so point. talked provides work are in globally is now our very which And That looking be we've would the foundation is one unified at platform, I

a our do short-term, you'll At in all acutely what see to Again, and moment, that. not that we we're profitability platform fall fresh unified the back you'll the target. to on tied design in hitting infrastructure driven end planning But sometime by that's new is that's and system. new see are apps focused the

that. in Molotov United French excited business, we're about launched shortly obviously also So, here after our very And States. would we've that the help

you From screen. an video time our sources data to better simple, same and syncing relatively data perspective, data to coming behind behind the sync having sure make in data and multiple coming It better about AI at or either -- your will a is we're be first sounds FanView in experience. want those and for the but think our on starting consumer for opportunity are what's is with a

We're on highlights. working also instant

when within So, of then alert DVR, that game we'll very also highlight games, you there. your think part of might have leveraging type part about opportunities. be some those condensed that's instant AI watching receive to our of all as there's watch. games be opportunities And And also you're DVR that compelling your also where on some that of moments will a might

obviously to could go XX and we've into working been see for platform, view powered months. now AI different on You plays that eight about actually is and our just by own all that which

we're all to our we're our on-prem processing video data to the pieces on from And moving working own other of center short-term happen then data one center in in our the is QX. that's cloud the of going where and

sort many solves it of because us for move important Very problems.

is problem cost. first The one

just ability higher So, potentially on just next product. we as a savings our have several side, the over control over fidelity video quality, years. will greater be then consumer as well of that to think there believe material latency, as the our And this

of things all are the short-term. in those So,

Satisfaction improving don't saying, for most the the TV Category JD not in Streaming double ranked know attention Again, performance by forward, paying to to we which but on is I'm me hope it's going what One we close want to we're Power. Looking Customer this, way the you platform hold Number I right down have team now again, product one Live core our as to product.

not we higher our that, five-year then And DVR. advanced I And again, in this so focused think fluidity, on is next year a of sort say quality, performance. I would so really or plan, right after the

sort coming out, So, highlights say soon. instant that's I very of would something

the we But the that and anyone a provide the upgrade the DVR. half year over is will we advent believe has probably that cloud next the upgrade since greatest that of seen

of I your that saying our going teams, but things. powerful be whole Fubo portfolio, a index following to if improve allow a know companies like that's and give recommendations a leveraging it's you're will obviously, chance. lot, or deeper It and to other will you DVR. then pretty discoveries. in actors, our that'll AI kinds and tool your Companies, companies And us plays, all to index personalization,

going just and can throw if have something a our don't that lot So, as deny guess is want further, to minds. something I on out I we even on UI you conversational think we

is features innovation of goal for industry sort continue But as are and is out. think with number multi-view, to our our this of XK, I other all the of to further in that again, But have set a standard extremely exciting. we

things great I on as you come. to long all focus think profitability So, as

Alison Sternberg

Over operator. David. you, you, to Thank

will participating. gentlemen, Thank this you. conclude Thank today's you Ladies call. conference and for

now disconnect. You may

fuboTV (FUBO) 5 May 232023 Q1 Earnings call transcript