FuboTV Inc. (FUBO) Business

Item 1. Business.

Our Mission

With a global mission to aggregate the best in TV, including premium sports, news and entertainment content, through a single app, Fubo aims to transcend the industry’s current TV model.

Overview

We are a sports-first, Pay TV replacement product offering subscribers access to tens of thousands of live sporting events annually, alongside leading news and entertainment content, both live and on demand. Fubo’s platform is designed to empower customers to seamlessly access content through streaming devices and on Smart TVs, mobile phones, tablets, and computers.

Live TV streaming has disrupted the traditional Pay TV model (linear video delivered via cable or satellite providers for a paid subscription), which we refer to as “Pay TV.” This disruption has shifted billions of dollars in subscription and advertising revenue to over-the-top (“OTT”) streaming platforms, as evidenced by the accelerating rate of Pay TV cord-cutting in the United States. We believe there remains a significant opportunity for us to capitalize on the cord-cutting movement.

We offer subscribers a live TV streaming service with the option to purchase incremental features, including additional content or enhanced functionality (“Attachments”) best suited to their preferences. Our subscription packages (including Fubo Essential, Pro, Elite, and others) boast a broad mix of top Nielsen-ranked channels across sports, news, and entertainment. Our offering sits on a proprietary technology platform built specifically for live TV and sports viewership, leveraging our first-party data. This enables us to consistently introduce new features and functionalities. Unlike video on demand ("VOD")-only services, live TV streaming demands sophisticated infrastructure due to the nuances of regularly refreshing live programming. Notably, our video delivery platform caters to all major sports leagues and entertainment content owners. For example, Apple TV and certain Roku users can enjoy MultiView, allowing them to watch up to four live streams simultaneously. Moreover, we leverage data across the organization to acquire subscriber-preferred content, influence product design and strategy, boost subscriber engagement, and enhance the capabilities and performance of our advertising platform for partners.

Our direct-to-consumer model grants us further insight by capturing billions of data points monthly. This data set drives our continuous innovation, shaping our enhanced user experience, product and content strategy, and differentiated advertising approach. By analyzing this data, we can personalize live and on-demand content discovery in real-time, creating relevant suggestions for each subscriber.

Our growth strategy includes acquiring subscribers who are attracted to our sports offering and can find with us a compelling sports, news, and entertainment viewing alternative to a traditional Pay TV service. We actively engage those subscribers by providing a seamless Pay TV replacement through a personalized easy-to-use streaming product at competitive prices with greater convenience and flexibility than traditional Pay TV providers. We then monetize our audience through subscription fees and our digital advertising offering. In 2022, 2023, and 2024 the majority of our revenue was generated from the sale of subscription services and the sale of advertisements in the United States, though the Company also has operations in Canada, Spain and France.

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Recent Developments — Business Combination

On January 6, 2025, the Company announced it had entered into a business combination agreement (the “Business Combination Agreement”) by and among the Company, The Walt Disney Company (“Disney”) and Hulu, LLC (“Hulu”), which contemplates, among other things, (i) Hulu contributing certain assets (the “HL Business Assets”) related to the business of negotiating and administering carriage agreements and similar contracts relating to and for the purpose of the retransmission, distribution, carriage, display or broadcast of any programming service, channel or network on the HL DMVPD Service (as defined below) to a newly formed entity to be jointly owned by Hulu and the Company (“Newco”), (ii) the Company undergoing an umbrella partnership C corporation reorganization (the “Up-C Reorganization”) and contributing its business to Newco in exchange for units in Newco (“Newco Units”) such that, after giving effect to such contribution, Hulu will hold a number of Newco Units representing, in the aggregate, a 70% economic interest in Newco and the Company will hold a number of Newco Units representing, in the aggregate, a 30% economic interest in Newco, and (iii) the Company issuing to Hulu shares of a newly created vote-only class of the Company’s common stock (“Class B Common Stock”) representing, in the aggregate, a 70% voting interest in the Company (calculated on a fully-diluted basis) (the transactions contemplated by the Business Combination Agreement, collectively, the “Business Combination). The HL Business Assets will include certain carriage agreements, rights under joint subscription agreements and related data and information about its subscribers, advertising or sponsorship agreements exclusively related to Hulu’s linear multi-channel subscription video programming distribution service component of the offering known as “Hulu + Live TV” as of the date of the Business Combination Agreement and operated by Hulu (such service, the “HL DMVPD Service”), all other assets (including intellectual property) exclusively related to the HL DMVPD Service and all intellectual property constituting the “Live TV” brand.

Upon the closing of the Business Combination (the “Closing”), our Board of Directors will initially be comprised of nine members, who will be designated as follows: (i) five designated by Hulu, (ii) two designated by the members of our Board as of immediately prior to the Closing and who (x) are reasonably acceptable to Hulu and (y) qualify as independent, (iii) one designated by Hulu and who qualifies as independent and (iv) our CEO. Following the Closing, the Company will be a “controlled company” for purposes of NYSE listing rules and will elect to be exempt from certain corporate governance requirements available to “controlled companies”. Completion of the Business Combination is subject to certain closing conditions specified in the Business Combination Agreement, including (i) the approval of the Business Combination Agreement, the Fubo Issuance and the Fubo Conversion, each as defined in the Business Combination Agreement, (including a plan of conversion and a certificate of incorporation of Fubo) by the Company’s shareholders, (ii) the expiration or termination of any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the clearance or obtainment of applicable consents of any specified governmental entity required to be obtained with respect to the Business Combination under the Business Combination Agreement; (iii) no enactment, issuance, promulgation or grant of any law or order, as applicable, by any governmental entity that is in effect and that has the effect of making the Business Combination illegal or prohibiting or otherwise preventing the consummation of the Business Combination, (iv) completion of the Hulu Reorganization and the Fubo Reorganization, each as defined in the Business Combination Agreement, in each case, in accordance with the Business Combination Agreement and the documents contemplated therein, (v) the acceptance of the Delaware Certificate of Conversion and Certificate of Incorporation of Fubo by the Secretary of State of the State of Delaware and the acceptance of the Florida Articles of Conversion by the Florida Department of State, (vi) the accuracy of the other party’s representations and warranties as of the date of the Business Combination Agreement, subject to certain customary materiality standards set forth in the Business Combination Agreement and the delivery by each party to the other party of a certificate certifying the same, (vii) compliance by each party, in all material respects, with its applicable pre-Closing obligations under the Business Combination Agreement, and (viii) delivery by each party to the other party of certain other closing deliverables, including, but not limited to, the ancillary agreements to which it is a party.

Industry Overview

Streaming services have experienced rapid growth in adoption as consumers engage with streaming video and audio through a variety of devices, including connected TVs, mobile phones, and tablets. While traditional Pay TV still accounts for a meaningful share of TV viewing hours for U.S. households, the proportion is declining as customers continue cutting the cord. We believe consumers are increasingly favoring the superior customer experience, competitive pricing, and better value of streaming services.

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Sports and news content have been a key driver for Pay TV operators to retain and grow audiences. Historically most streaming subscription services primarily focused on entertainment content offerings, requiring sports fans to, until recently, remain tethered to the Pay TV ecosystem. This positions our offering well to provide a Pay TV replacement service via streaming that also features an enhanced live sports and news viewing experience.

Our Business Model

Our business motto is “come for the sports, stay for the entertainment.” This consists of leveraging sporting events to acquire subscribers at efficient acquisition costs, given the built-in demand for sports. We then leverage our technology and data to drive higher engagement and induce retentive behaviors such as watching content, favoriting channels, recording shows, and increasing discovery through our proprietary machine learning recommendations engine. We monetize our growing base of highly engaged subscribers by driving higher average revenue per user (“ARPU”).

We drive our business model with three core strategies:

•Grow our paid subscriber base

•Optimize our content portfolio, engagement and retention

•Increase monetization through subscription and advertising

Our Offerings

Subscribers

Our live TV streaming platform caters to sports, news, and entertainment fans. With flexible plans and optional "Attachments," users can customize their experience. The subscription packages boast over 100+ channels, including top Nielsen-rated networks, and dozens of sports, news, and entertainment options. They may also feature numerous Regional Sports Networks ("RSNs") for in-market games unavailable on national channels. Subscribers can further tailor their experience by adding premium channels and channel packages, or upgrading "Attachments" like Cloud DVR Plus for more storage and Family Share for additional simultaneous streams.

Advertisers

As cord cutting continues and traditional Pay TV viewers decline, advertisers are increasingly allocating their ad budgets to OTT streaming platforms to reach these audiences. We believe our sports-first, live TV streaming platform offers advertisers a growing and valuable live audience, deeply engaged with premium content and unreachable through traditional channels. Moreover, Fubo provides unskippable ad inventory within this high-quality engagement, maximizing exposure. Advertisers further benefit from our innovative ad formats, bridging the gap between traditional Pay TV and the advantages of digital advertising, including measurability, relevancy, and interactivity. We believe this combination delivers a differentiated advertising experience for brands and viewers alike.

Content Providers

Our platform allows content providers to monetize and distribute their content to our highly engaged audience, counteracting the shrinking viewership market share of Pay TV due to cord-cutting. By aggregating a diverse mix of content, we believe Fubo delivers a more compelling and engaging experience for subscribers than providers could offer alone.

Seasonality

We generate significantly higher levels of revenue and subscriber additions in the third and fourth quarters of the year. This seasonality is driven primarily by an influx of new subscribers at the start of the National Football League and college football. Our operating results may also be affected by the scheduling of major sporting events that do not occur annually, such as the World Cup or Olympic Games, or the cancellation or postponement of sporting events. In addition, we typically see the total number of subscribers on our platform decline from the fourth quarter of the previous year through the first and second quarter of the following year.

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Our Growth Strategies

We believe streaming has begun to surpass traditional linear Pay TV in several key areas, including content choice, ease of access and use across devices, and cost savings to consumers. We remain committed to our goal of driving sustainable and profitable growth, and we believe we are well-positioned to do this by executing on the following strategies:

•Continue to efficiently grow our subscriber base: As of December 31, 2024, Fubo had approximately 1.7 million paid subscribers in the United States and Canada (“North America” or “NA”) and approximately 362,000 paid subscribers in Spain and France (“Rest of World” or “ROW”), compared to approximately 1.6 million in NA and approximately 406,000 in ROW as of December 31, 2023. We utilize a broad range of subscriber acquisition channels and tactics designed to optimize marketing spend and efficiently acquire and retain subscribers. Our Sales and Marketing expenses relative to total revenues was approximately 12.5% for the year ended December 31, 2024, compared to 15.1% for the year ended December 31, 2023. We continue to utilize and analyze the data we have collected to help us become more efficient with our marketing campaigns relative to spend.

•Enactment of ARPU expansion efforts: Our NA ARPU was $85.97 and $82.25 for the year ended December 31, 2024 and 2023, respectively. Our ROW ARPU was $7.49 and $6.82 for the year ended December 31, 2024 and 2023, respectively. We drive ARPU expansion through price-increases, attachment sales, and advertising revenue growth. Attachments, including channel package add-ons and interactive features, increase our margins by piggybacking on to our base offerings and not meaningfully increasing our cost basis while increasing revenues.

•Further investment in advertising sales team, technology and infrastructure: For the years ended December 31, 2024 and 2023, Fubo’s advertising revenue was approximately $115.2 million and $115.4 million, respectively. Improvements to our content portfolio, user interface, navigational elements, content merchandising and targeting capabilities, combined with evolutions in customer behavior and growth in our subscriber base, have driven growth of our viewership over time. We are increasingly monetizing this engagement through advertising on the Fubo platform. We intend to continue leveraging our data and analytics to deliver relevant advertising while improving the ability of our advertisers to optimize and measure the results of their campaigns. We have also expanded our direct sales teams to increase the number of advertisers who leverage our platform and continue improving our fill-rates and Cost Per Thousands (“CPMs”).

•Continue to enhance our content portfolio with cost vigilance: Because we have a direct-to-consumer relationship with the ability to analyze all the content that our subscribers consume, we believe we can continue to drive better subscriber experiences. We plan to continue to optimize our content mix to best suit our subscribers’ interests by leveraging our deep understanding of our subscribers through the data captured on the platform, with the goal of expanding unit economics by balancing the aggregation of the best sports and entertainment programming with vigilance around content costs.

•Continue to invest in our technology and data capabilities: We believe our unique combination of technology and content sets us apart. We continue to invest in building a scalable, automated infrastructure specifically designed to fuel subscriber acquisition, strategic content selection, and informed product decisions. We emphasize interactive features that empower users to transform from passive viewers to active participants. Moreover, we believe our integration of the Fubo and Molotov platforms into a single Unified Platform will yield significant efficiencies, and increased product development velocity and innovation.

•Expand Internationally: Outside of the United States, we currently operate in Canada, Spain and, through our acquisition of Molotov in 2021, France. We believe there remains a significant opportunity to expand internationally.

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Intellectual Property

Our intellectual property is an essential and valuable element of our business. We rely on a combination of patent, trademark, copyright and other intellectual property laws, confidentiality agreements and license agreements to protect and enforce our intellectual property rights. We also license certain third-party technology and intellectual property for use in conjunction with our products.

We believe that our continued success depends on hiring and retaining highly capable and innovative employees, especially as it relates to our engineering base. It is our policy that our employees and independent contractors involved in intellectual property development are required to sign agreements acknowledging that all inventions, trade secrets, works of authorship, developments and other processes generated by them on our behalf are our property and assigning to us any ownership that they may claim in those works. Despite our precautions and policies, it may be possible for third parties to obtain and use without consent intellectual property that we own or license. Unauthorized use of our intellectual property by third parties, and the expenses incurred in protecting our intellectual property rights, may adversely affect our business, financial condition and results of operations.

Patents and Registered Designs

As of December 31, 2024, we had five issued U.S. utility patents, one U.S. utility patent application, five granted foreign utility patents, seventeen foreign utility patent applications, and eighteen granted foreign design registrations in three jurisdictions. The issued U.S. utility patents expire in 2038, the U.S. utility patent application, if granted, will expire in 2041, the granted foreign utility patents will expire on dates ranging from 2033 to 2038, the foreign utility patent applications, if granted, will expire on dates ranging from 2033 to 2041, and the foreign design registrations will expire on dates ranging from 2035 to 2045. Although we actively attempt to utilize patents to protect our technologies, we believe that none of our patents, individually or in the aggregate, are material to our business. We will continue to file and prosecute patent applications when appropriate to attempt to protect and enforce our rights in our proprietary technologies. However, there can be no assurance that our patent applications will be approved, that any patents issued will adequately protect our intellectual property, or that such patents will not be challenged by third parties or held to be invalid or unenforceable.

Trademarks

We also rely on several registered and unregistered trademarks to protect our brand and business. As of December 31, 2024, we had thirty-seven trademarks registered globally and two trademark applications. “fuboTV” is a registered trademark in the United States and the European Union ("EU").

Competition

The TV streaming market continues to grow and evolve as more viewers shift from traditional Pay TV to OTT streaming. There is significant competition in the live TV market for users, advertisers, and broadcasters. We principally compete with Pay TV operators, such as DirecTV, Comcast, Cox and Altice, along with other virtual multichannel video programming distributors (“vMVPDs”), such as YouTube TV, Hulu + Live TV, DirecTV Stream, Philo and Sling TV. We also compete to a lesser extent with network-operated direct-to-consumer streaming services, such as Peacock, Paramount+, and ESPN+.

We compete on various factors to acquire and retain subscribers. These factors include quality and breadth of content offerings, especially within live sports; features of our TV streaming platform; user experience and engagement; brand awareness in the market; and a competitive value proposition. Many users have multiple subscriptions to various Pay TV and streaming services and allocate time and money between them. Thus, while the presence of these competitors in the market has helped to boost consumer awareness of TV streaming, contributing to the growth of the overall market, their resources and brand recognition present substantial competitive challenges.

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We also face competition for advertisers, which in part depends on our ability to scale our subscriber base. Providing a large and engaged audience is crucial for advertisers on our live TV streaming platform. In the TV streaming market, the effectiveness of advertisements and return on investments play a pivotal role. As such, we are also competing for advertisers based on the return of ads compared to various other digital advertising platforms, including mobile and web. Additionally, advertisers continue to allocate a large portion of spend to advertise offline. Therefore, we also compete with traditional media platforms such as traditional linear Pay TV and radio. We are increasingly leveraging our data and analytics capabilities to optimize advertisements for both users and advertisers. We need to continue to maintain an appropriate advertising inventory for the growing demand for ads on our platform.

Furthermore, we compete to attract and retain programmers. Our ability to license content from programmers is dependent on the scale of our user base as well as license terms.

Our People and Human Capital Management

Who We Are

We are an inclusive group of individuals, creatives, technologists, analysts and more. Some of us love sports, some binge the news, others prefer rom-coms. But we are united by a common mission — building the world’s leading global live TV streaming platform with the greatest breadth of premium content and interactivity.

As of December 31, 2024, we had approximately 590 employees globally, of which approximately 400 were located in North America and approximately 190 were located in Europe and India. Additionally, we rely on independent contractors and temporary personnel to supplement our workforce from time to time. We have not experienced any work stoppages, and we consider our relationship with our employees to be good. None of our U.S. or Indian employees is represented by a labor union or covered by a collective bargaining agreement. Our French employees are covered by the national collective bargaining agreement for the consulting and engineering activities in France.

Our Values and Talent Development

We view our employees as central to the success of our business and achieving our mission. We onboard new employees with training programs on our values, certain aspects of our business, and important policies, including our Code of Business Conduct. We also value ongoing development and continuous learning, and strive to support and provide enriching opportunities to our employees. Throughout the year we monitor employee engagement and provide periodic training and informational sessions on our business and policies, including security awareness, through a variety of forums, including all-hands meetings, senior leadership fireside chats and company-wide newsletters. Management uses input collected during these sessions to ensure ongoing awareness of employees’ needs and improve activities aimed to serve our customers. Collectively through these initiatives we aim to foster engagement and transparency with our employees, and to keep our employees well-informed on our business goals to enhance alignment, collaboration, and a shared sense of purpose among our employees.

Inclusion and Belonging

We prioritize building an inclusive, equitable, and empowered team representing a mix of backgrounds, industries, skills, and levels of experience. We believe the different backgrounds, traditions, views and talents each of our employees brings to Fubo enrich the company as a whole and will help us achieve executional excellence. In 2020, we formed a council comprised of different team members throughout various levels of the organization, who recommend and help organize and celebrate both engagement and inclusion initiatives within the company. We are focused on creating and maintaining a workplace free from discrimination or harassment on the basis of race, religion, religious creed, color, ethnic or national origin, ancestry, gender, sexual orientation, age, marital status, military service or veteran status, disability, medical condition, or any other status protected by applicable law. Our policies and compliance trainings prohibit such workplace discrimination and harassment, and all our employees are expected to exhibit and promote honest, ethical, and respectful conduct in the workplace.

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Compensation and Benefits

Our compensation programs and benefits packages are designed to attract, retain and motivate exceptional talent who possess the skills necessary to drive our business objectives, assist in the achievement of our strategic goals and create long-term value for our shareholders. We offer employees compensation packages designed to be competitive that include base salary, and, depending on the role, business function and geographic market, performance-based cash bonuses, commissions, long-term incentive equity, and performance-based equity. We are proud that we have granted equity to the majority of our employees across all levels of the organization as part of their total compensation package. We believe this fosters a stronger sense of ownership and further aligns our employees’ interests with the interest of our shareholders. In addition to our compensation programs, we offer a variety of benefits to our employees, which can include 401(k) plan with matching, health (medical, dental and vision) insurance, life insurance, paid time off, paid parental leave, a referral bonus program and company-sponsored short term and long term disability. We believe that a competitive compensation and benefits program with both short-term and long-term award opportunities, including awards tied to the achievement of meaningful performance metrics, allows us to align employees with shareholder interests.

Health and Safety

We are committed to the health and safety of our employees, and continue to adapt to ever-changing workplace and workforce dynamics. The majority of our employees have adopted a hybrid work schedule (consisting of both in-person work and working from home); however some of our employees continue to work remotely full-time, and, in the long term, we expect some personnel to continue to do so on a regular basis. We are focused on building capabilities to support a variety of work styles where individuals, teams, and our business can be successful. We have invested in programs that help support our employees’ day-to-day wellness needs and goals including access to professional counselors, health coaching and advocacy services. We also maintain a whistleblower hotline through which employees can report health and safety risks.

Government Regulation

Our business and our devices and platform are subject to numerous domestic and foreign laws and regulations covering a wide variety of subject matters. These include general business regulations and laws, as well as regulations and laws specific to providers of Internet-delivered streaming services and Internet-connected devices. New or modified laws and regulations in these areas may have an adverse effect on our business. The costs of compliance with these laws and regulations are high and are likely to increase in the future. We anticipate that several jurisdictions may, over time, impose greater financial and regulatory obligations on us. If we fail to comply with these laws and regulations, we may be subject to significant liabilities and other penalties. Additionally, compliance with these laws and regulations could, individually or in the aggregate, increase our cost of doing business, impact our competitive position relative to our peers, and otherwise have an adverse impact on our operating results. For additional information about the impact of government regulations on our business, see “Risk Factors—Risks Related to Regulation” and “Risk Factors—Risks Related to Privacy, Consumer Protection and Cybersecurity” in Part I, Item 1A in this Annual Report.

Data Protection and Privacy

We are subject to various laws and regulations covering the collection, use, access to, confidentiality and security of health-related and other personal information, and additional laws could apply in the future to our operations or the operations of our partners. These laws and regulations, and their application to our business, are increasingly shifting and evolving. In the United States, numerous federal and state laws and regulations, including data breach notification laws, health information privacy and security laws and consumer protection laws and regulations govern the collection, use, disclosure, and protection of health-related and other personal information. In addition, certain foreign laws govern the privacy and security of personal data, including health-related data. Any actual or perceived failure to comply with these laws and regulations may result in investigations, claims and proceedings, regulatory fines or significant civil and/or criminal penalties, damages for breach of contract, or orders that require us to change our business practices, including the way we process data.

For additional information about the impact of data protection and privacy regulations on our business, see “Risk Factors—Risks Related to Privacy, Consumer Protection and Cybersecurity” in Part I, Item 1A in this Annual Report.

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Corporate Information

We were incorporated in 2009 as a Florida corporation under the name York Entertainment, Inc., and on August 10, 2020, our name was changed to fuboTV Inc. FuboTV Media Inc. (f/k/a fuboTV Inc.) was incorporated in 2014 as a Delaware corporation. Our principal executive offices are located at 1290 Avenue of the Americas, 9th Floor, New York, New York 10104, and our telephone number is (212) 672-0055. Our website address is at https://fubo.tv. Information contained on, or that can be accessed through, our website is not incorporated by reference into this Annual Report, and you should not consider information on our website to be part of this Annual Report.

Available Information

Our internet website address is www.fubo.tv. At our Investor Relations website, ir.fubo.tv, we make available free of charge a variety of information for investors, including our annual report, quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments to those reports, as soon as reasonably practicable after we electronically file that material with or furnish it to the Securities and Exchange Commission (“SEC”). The information found on our website is not part of this or any other report we file with, or furnish to, the SEC.

We announce material information to the public through filings with the SEC, the investor relations page on our website, press releases, our X account (@fuboTV), our Instagram account (@fubotv), our Facebook page (www.facebook.com/fuboTV), our LinkedIn page (www.linkedin.com/company/fubotv/), public conference calls, and webcasts in order to achieve broad, non-exclusionary distribution of information to the public and for complying with our disclosure obligations under Regulation FD. We encourage investors, the media, and others to follow the channels listed above and to review the information disclosed through such channels. Any updates to the list of disclosure channels through which we will announce information will be posted on the investor relations page on our website.