Sports streaming service fuboTV has pulled the plug on its gambling business and closed down its Fubo Gaming subsidiary and adjacent sportsbook product.
Although the company reported better than anticipated Q3 results, the decision to exit the online wagering business was taken to avoid jeopardising the group’s 2025 profitability goals amid the “challenging macroeconomic environment”.
In August, fuboTV placed its online betting business under review to find the best way to scale its sportsbook, which it launched in 2021.
The New York-listed group said that while multiple parties expressed an interest in the business, none of the opportunities would have allowed fubo to lower its funding requirements and generate sufficient returns to shareholders.
FuboTV expects to close Q3 2022 with North America revenue of at least $210m, an increase of approximately 34% year-on-year.
Rest of World (ROW) revenue is expected to be at least $5.5m, which includes Molotov, the French live TV streaming service acquired by fuboTV in December 2021.
Prior third quarter revenue guidance for the company’s North American streaming business was $200m to $205m and between $5 and $6m for ROW.
Paid subscribers in North America are expected to exceed 1.22 million, an increase of more than 27% year-over-year, with ROW paid subscribers expected to reach approximately 350,000.
FuboTV CEO David Gandler: “FuboTV’s strong preliminary Q3 2022 results reflect meaningful advancements against our continued mission to profitably scale a leading global live TV streaming platform differentiated by the greatest breadth of premium content and interactivity.”
FuboTV’s previous third-quarter subscriber guidance was 1.14 million to 1.16 million for North America, and 340,000 to 360,000 rest-of-world subscribers.
The group expects to post approximately negative $100m of adjusted EBITDA for the period, while its balance of cash and cash equivalents at the end of Q3 are expected to be at least $300m.
FuboTV co-founder and CEO David Gandler commented: “FuboTV’s strong preliminary third quarter 2022 results reflect meaningful advancements against our continued mission to profitably scale a leading global live TV streaming platform differentiated by the greatest breadth of premium content and interactivity.”
Gandler concluded that fuboTV expects to deliver strong revenue and subscriber growth in Q3 “against the backdrop of a highly competitive operating environment”.
“We’re pleased with this expected performance, and our progress toward achieving our positive cash flow target in 2025,” he added.
FuboTV’s Fubo Sportsbook has gone live in New Jersey as the company continues to look for strategic partners for its online wagering business.
FuboTV, which is primarily a sports streaming disruptor, made a splash within US sports betting by pledging to integrate digital wagering within its core broadcast product.
DAZN is another company exploring the intertwining of these two verticals, but it has not been plain sailing for either company, to such a degree that Fubo has actually placed its wagering business under strategic review.
Fubo said the New Jersey sportsbook launch reinforces its commitment to interactive wagering, although it no longer intends to explore this opportunity by itself due to the macroeconomic environment.
Online sports betting is not a cheap industry to enter. Indeed, many of the market leaders in the space have racked up huge losses to date on advertising, new state launches and acquiring players.
Speaking of acquisition, New Jersey residents who register with Fubo Sportsbook can claim a Bet $20, Get $150 offer with a special promotion code, as well as one month free of FuboTV.
“With the official launch of Fubo Sportsbook in New Jersey, the Fubo Lounge and Fubo’s wagering app will provide an opportunity for our fans to responsibly gamble on sporting events from one of the best experiential settings in the NFL,” said the company.
Fubo Gaming president Scott Butera: “As one of the largest and most established sports betting markets in the US, New Jersey will allow Fubo to analyse and efficiently develop the most engaging product features that are focused on driving streaming customers into wagering.”
According to Fubo, users in the Garden State will soon be able to experience Fubo Sportsbook’s proprietary Watch & Wager feature, which leverages FuboTV’s first-party user data to recommend relevant bets based on what viewers are streaming.
The Fubo Sportsbook app is available to download on iOS or Android and went live in New Jersey via a market-access agreement with Caesars Entertainment and following soft-launch approval from the New Jersey Division of Gaming Enforcement (NJDGE).
The company is already tied to New Jersey via its multi-year partnership with the New York Jets, who play their NFL home matches at the MetLife Stadium in the Garden State.
Last year, Fubo opened a 7,000-square-foot lounge at the arena, which will be expanded for the 2022 season to include a mobile sports betting lounge.
“Launching Fubo Sportsbook in New Jersey is an important early step in the development of our integrated platform, which includes a recently improved user experience and enhanced product capabilities,” said Scott Butera, president of Fubo Gaming.
“As one of the largest and most established sports betting markets in the US, New Jersey will allow Fubo to analyse and efficiently develop the most engaging product features that are focused on driving streaming customers into wagering.
“New Jersey is known for having deeply passionate sports fans, who, we believe, will enjoy our one-of-a-kind immersive sports wagering and viewing experience in time for football season,” he added.