Cord-cutters and tech investors might be interested to learn that sports-centric over-the-top (OTT) live TV streaming service fuboTV filed and IPO for listing on the New York Stock Exchange, at a time when the company was seeing a boost in viewership from COVID-19 shelter-in-place conditions.
The streaming platform company that was previously OTC listed, originally filed for the IPO with the Securities & Exchange Commission in August, and this week placed 15 million shares of common stock valued at more than $165 million on the NYSE.
It plans to list its stock under the symbol “FUBO.” Roth Capital Partners and Wedbush Securities are acting as co-managers for the proposed offering.
Underwriters have a 30-day option to buy an additional 2.25 million shares of common stock from fobu TV at the public offering price, which is expected to be between $9 and $11 per share.
The move follows the merger in April between the streaming platform and the Facebank Group, in which Disney is a 5% investor. The combined company retained the fuboTV name.
The live OTT streaming TV service and its investors will be looking to further capitalize on consumers stuck at home during the COVID-19 crisis. The service’s app is offered on a wide cross section of smart TVs and streaming media players including the recent addition of Microsoft’s popular Xbox One gaming consoles.
At the time the IPO was announced, a resurgence in the infection rate appeared to be escalating, with even President Trump and the First Lady announcing they had tested positive for the virus.
Fubo TV is in a competitive field of live OTT services that includes: YouTube TV, Sling TV, Hulu Plus Live TV and others. It is differentiated by its heavy inclusion of live sports channels carrying games from popular professional sports leagues on both regional and national sports channel apps, including the NFL Network.
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At the end of 2019, the company reported 316,000 paid subscribers and $147 million in revenue. But it’s business is both competitive and volatile, as subscribers are not locked into long-term commitments and can cancel and switch services on a month to month basis.
Paid subscribers at the end of the second quarter (June 30th) totaled 286,126, an increase of 47% over the same period in 2019. Average Revenue Per User (ARPU) per month for the period was $54.79, up 8% year-over-year.
Total content hours streamed by fuboTV users (paid and free trial) in Q2-2020 increased 83% year-over-year to 98.6 million hours. Monthly active users (MAUs) watched 140 hours per month on average in the quarter, an increase of 54% year-over-year, the company reported.
Revenues for Q2 were $44.2 million, a 53% increase year-over-year on a pro forma basis. At the same time, subscription revenue increased 51% year-over-year to $39.5 million, and advertising revenue increased 71% year-over-year to $4.3 million.
Between April-June the company had added $46 million in equity funding from institutional and private investors. This included $26 million closed during the second quarter of the year, and a transaction with Credit Suisse Capital to invest $20 million at a purchase price of $9.25 per share that closed on July 2, to be reflected in Q3 financials.
Reconciliation of net loss to adjusted EBITDA for Q2 was negative $41.9 million.
Edgar Bronfman Jr., former chairman and CEO of Warner Music, was recently named executive chair of the Board of Directors.
In a letter to investors in August, fubo TV CEO David Gandler said: “We continue to believe fuboTV is at the forefront of the streaming revolution. fuboTV is the leading sports-first, live TV streaming platform, offering subscribers access to tens of thousands of live sporting events annually as well as leading news and entertainment content. At the core of our offering is our proprietary technology platform optimized for live TV and sports viewership. Our proprietary technology stack has enabled us to regularly offer new features and functionality. For example, we were the first vMVPD to stream in 4K resolution. We also offer multi-view on Apple TV, which enables subscribers to watch two live streams simultaneously, as well as the ability to watch select sports content from multiple camera angles.”
He added: “We continue to be very excited about fuboTV’s future and the strength of our company. We believe fuboTV is at the forefront of the streaming revolution in the $226 billion pay TV services market and are excited for existing and new investors to join us on this journey.”
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By Greg Tarr
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