Live sports and TV streaming service fuboTV (NYSE:FUBO) announced better-than-expected revenue in Q3 CY2024, with sales up 20.3% year on year to $386.2 million. Its GAAP loss of $0.16 per share was also 10.4% above analysts’ consensus estimates.

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fuboTV (FUBO) Q3 CY2024 Highlights:

• Revenue: $386.2 million vs analyst estimates of $376.8 million (2.5% beat)

• EPS: -$0.16 vs analyst estimates of -$0.18 ($0.02 beat)

• EBITDA: -$27.56 million vs analyst estimates of -$36.61 million (~$9 million beat)

• Gross Margin (GAAP): 14%, up from 6.1% in the same quarter last year

• Operating Margin: -15.2%, up from -26% in the same quarter last year

• EBITDA Margin: -7.1%, up from -19.1% in the same quarter last year

• Free Cash Flow was -$3.33 million compared to -$29.5 million in the same quarter last year

• Domestic Subscribers: 1.61 million at quarter end

• Market Capitalization: $573 million

Company Overview

Originally launched as a soccer streaming platform, fuboTV (NYSE:FUBO) is a video streaming service specializing in live sports, news, and entertainment content.

Media

The advent of the internet changed how shows, films, music, and overall information flow. As a result, many media companies now face secular headwinds as attention shifts online. Some have made concerted efforts to adapt by introducing digital subscriptions, podcasts, and streaming platforms. Time will tell if their strategies succeed and which companies will emerge as the long-term winners.

Sales Growth

Examining a company’s long-term performance can provide clues about its business quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Over the last five years, fuboTV grew its sales at an incredible 68.6% compounded annual growth rate. This is a useful starting point for our analysis.

Long-term growth is the most important, but within consumer discretionary, product cycles are short and revenue can be hit-driven due to rapidly changing trends and consumer preferences. fuboTV’s annualized revenue growth of 31.4% over the last two years is below its five-year trend, but we still think the results were good and suggest demand was strong.

This quarter, fuboTV reported robust year-on-year revenue growth of 20.3%, and its $386.2 million of revenue topped Wall Street estimates by 2.5%.

Looking ahead, sell-side analysts expect revenue to grow 10.2% over the next 12 months, a deceleration versus the last two years. This projection is underwhelming and shows the market believes its products and services will see some demand headwinds.