Shares of live sports streaming service fuboTV (NYSE: FUBO) shot up 4.5% through 11 a.m. ET Friday after reporting better than expected revenue (but no profit) this morning.
Heading into the third quarter, analysts had forecast fuboTV would lose $0.32 per share on sales of only $286.2 million. fuboTV beat that revenue number with a stick, reporting quarterly sales of $313 million. And while the company was not profitable for the quarter, its per-share loss as calculated according to generally accepted accounting principles (GAAP) was only $0.29.
fuboTV sales and earnings
U.S. sales (the company's biggest business) for the quarter surged 43% in comparison to last year's Q3 -- twice as fast as the company's 20% growth in subscribers, indicating strong financial benefits as the company gains scale. Indeed, average revenue per user grew 17% across this larger user base.
On earnings, obviously the news wasn't as great -- because fuboTV isn't earning anything just yet. Still, management said it is making progress toward its goal of generating positive cash flow. The company burned through $29.5 million in cash in Q3 2023, or less than half last year's Q3 burn rate of $69.7 million.
fuboTV guidance and valuation
That being said, the fact remains that both earnings and free cash flow are still negative at fuboTV. Accentuating the positive therefore, when turning to guidance, management stuck to discussing its revenue and user growth prospects.
Revenue in 2023 is now looking likely to come in around $1.32 billion, up from the $1.27 billion previously guided. Total customers are expected to grow past $1.58 million, and could perhaps reach 1.6 million. And again, this implies that revenue is growing much faster than users -- 34% growth in revenue versus just 10% growth in subscribers.
While it's hard to stick a value on a company that isn't earning profits, at least fuboTV stock seems to be moving in the right direction.
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Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends fuboTV. The Motley Fool has a disclosure policy.
