FuboTV shutters sports betting business amid profitability concerns

Sports-focused streaming platform FuboTV has switched off its sports betting division in the US just two months after launching a strategic review into the arm. In August, the sports streaming platform put Fubo Sportsbook under review after establishing it would no longer be able to develop a sports betting product on its own. FuboTV, which has around 1.57 million subscribers, including 1.2 million in North America, said the evaluation of operations was driven by the “rapidly evolving macroeconomic environment” after CEO David Gandler said in May the division would be one of the firm’s key pillars for future success. It has been a tumultuous 2022 for Fubo Sportsbook, as head of trading Jay Vaccaro departed in July, while Fubo Gaming COO Sam Rattner stepped down in January. Fubo Sportsbook was live in Iowa and Arizona, and just recently launched in New Jersey, plus held market-access deals in states like Indiana. It is unclear at this stage how these agreements will be settled. The operator generated $1.9m of handle in Iowa in 2022, achieving revenue of just shy of $117,000. In Arizona, Fubo Sportsbook recorded handle of just $210,377 in handle, down from a high of almost $900,000 in February. The foundations for FuboTV’s aspirations of blending live sport with sports betting were set in motion with the acquisition of sports betting and interactive gaming firm Vigtory, announced in January 2021, yet the venture struggled to compete with established bookmakers. FuboTV said that “multiple parties” had expressed interest in Fubo Sportsbook, but that none of these offers would have allowed the company to lower its funding requirements and produce “sufficient returns” for shareholders. The firm confirmed the subsidiary would close immediately. Touching on the decision, Gandler said the company’s strategy to achieve long-term profitability would have been hampered by continuing to work on its sports betting aspirations. Gandler said: “Following our previously announced strategic review, we have concluded that continuing with Fubo Gaming and Fubo Sportsbook in this challenging macroeconomic environment would impact our ability to reach our longer-term profitability goals. “Therefore, we have made the difficult decision to exit the online sports wagering business effective immediately,” he added. FuboTV has previously set 2025 profitability targets. The announcement of the closure of Fubo Sportsbook coincided with the group’s preliminary Q3 financial results, in which FuboTV is expected to return negative adjusted EBITDA of $100m. The group anticipates returning $215.5m in revenue for the reporting period. FuboTV shares rose 6.3% in afterhours trading to just over $4.