Digital Streaming And Ad Tech Will Expand Future Markets

Key Takeaways

• Sports-focused bundles, exclusive content partnerships, and enhanced user personalization aim to drive subscriber growth, engagement, and revenue diversification.
  
• Improved ad technology, operational efficiency, and international expansion support margin gains and position for sustainable long-term profitability.
  
• Ongoing subscriber losses, content deal challenges, competitive pressures, and persistent profitability issues threaten fuboTV's long-term growth and financial stability.

Catalysts

Operates a live TV streaming platform for live sports, news, and entertainment content in the United States and internationally.

• Launch of Fubo Sports, a more affordable, sports-focused skinny bundle, and pay-per-view offerings are expected to tap into the broader shift from traditional cable TV to streaming, potentially expanding Fubo's total addressable market and supporting future subscriber growth and revenue.
  
• Expansion of content partnerships (e.g., with DAZN), including distribution of exclusive sports rights and FAST channels, enhances differentiation and could drive higher average revenue per user (ARPU) and sustained premium subscription growth.
  
• Ongoing enhancement of user experience through personalized features (Catch Up To Live, Game Highlights, Timeline Markers) directly aligns with rising consumer demand for personalized, interactive content, likely supporting higher engagement, lower churn, and improved earnings stability.
  
• Integration of data-driven ad technology with international operations (Molotov) and increasing contribution from FAST channels positions Fubo to benefit from the secular shift in ad spend toward digital/OTT, potentially accelerating higher-margin ad revenue.
  
• Progress towards positive adjusted EBITDA and margin expansion, as demonstrated by recent quarter profitability, reflects ongoing operational efficiencies and cost discipline, laying the foundation for improved net margins and long-term earnings growth.

fuboTV Future Earnings and Revenue Growth

Assumptions

• Analysts are assuming fuboTV's revenue will grow by 3.8% annually over the next 3 years.
• Analysts are not forecasting that fuboTV will become profitable in next 3 years. To represent the Analyst Price Target as a Future PE Valuation we will estimate fuboTV's profit margin will increase from 5.4% to the average US Interactive Media and Services industry of 11.0% in 3 years.
• If fuboTV's profit margin were to converge on the industry average, you could expect earnings to reach $200.3 million (and earnings per share of $0.52) by about August 2028, up from $87.7 million today.
• In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 11.1x on those 2028 earnings, down from 14.7x today. This future PE is lower than the current PE for the US Interactive Media and Services industry at 13.6x.
• Analysts expect the number of shares outstanding to grow by 3.98% per year for the next 3 years.
• To value all of this in today's terms, we will use a discount rate of 8.82%, as per the Simply Wall St company report.

fuboTV Future Earnings Per Share Growth

Risks

• fuboTV's year-over-year decline in both revenue (down 3% in North America) and subscribers (down 6.5% in North America and 12.5% Rest of World) signals ongoing challenges in growing or even maintaining its user base, indicating possible subscription fatigue and increased churn that could suppress long-term revenue growth.
  
• Loss of key ad-insertable content deals (e.g., with Warner Bros. Discovery and TelevisaUnivision) reduced ad revenue and undermined the ad-supported content inventory, demonstrating fuboTV's vulnerability to content rights fragmentation and increasing competition for distribution, ultimately putting pressure on gross margins and future revenue.
  
• Despite the first quarter of positive adjusted EBITDA, the company continues to burn cash (negative free cash flow of $37.7 million in Q2, worsening year-over-year), highlighting unresolved structural profitability issues and the risk of further dilution or heightened cost of capital, which would impact long-term earnings and shareholder value.
  
• The competitive threat from larger, better-resourced players (notably the consolidation of Disney's streaming bundle with ESPN+, Disney+, and Hulu at a lower price point) could erode fuboTV's pricing power and differentiation, amplifying the risk of both increased customer acquisition costs and reduced ARPU, thereby constraining revenue and margin expansion.
  
• Fragmented and dynamic media rights negotiations (evidenced by failed deals and ongoing talks for key sports properties) along with the industry trend of content owners shifting to direct-to-consumer models increases operational uncertainty and could limit the breadth of must-have content on fuboTV's platform-undermining subscriber growth and long-term revenue sustainability.

Valuation

• The analysts have a consensus price target of $4.5 for fuboTV based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $5.0, and the most bearish reporting a price target of just $4.25.
  
• In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $1.8 billion, earnings will come to $200.3 million, and it would be trading on a PE ratio of 11.1x, assuming you use a discount rate of 8.8%.
  
• Given the current share price of $3.76, the analyst price target of $4.5 is 16.4% higher.
  
• We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.