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What changed in FuboTV Inc.'s 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of FuboTV Inc.'s 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+446 added−506 removedSource: 10-K (2023-02-27) vs 10-K (2022-03-01)

Top changes in FuboTV Inc.'s 2023 10-K

446 paragraphs added · 506 removed · 298 edited across 5 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeWe have consistently upgraded our Attachment offerings, as well as optimized our merchandising and bundling of these offerings, and as a result have more than doubled the attach rate of our subscribers. 8 ● Grow Advertising Inventory: Improvements to our content offering, UI / navigational elements and content merchandising / targeting capabilities, combined with evolutions in customer behavior and growth in our subscriber base, have driven growth of our viewership over time.
Biggest changeImprovements 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.
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 model is “come for the sports, stay for the entertainment.” This consists of leveraging sporting events to acquire subscribers at lower acquisition costs, given the built-in demand for sports.
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 lower acquisition costs, given the built-in demand for sports.
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 found by a judicial authority to be invalid or unenforceable. 9 Trademarks We also rely on several registered and unregistered trademarks to protect our brand.
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 found by a judicial authority to be invalid or unenforceable. Trademarks We also rely on several registered and unregistered trademarks to protect our brand.
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 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 privacy and protection of users’ data.
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 privacy and protection of users’ data.
Such changes could potentially have an adverse impact on our business. For additional information about the impact of data protection and privacy regulations on our business, see “Risk Factors—Risks Related to Privacy and Cybersecurity” in Part I, Item 1A in this Annual Report.
Such changes could potentially have an adverse impact on our business. 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.
Furthermore, our data-driven platform enables us to capture valuable insights on consumer behavior and preferences, which are increasingly valuable to our content providers. 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 sports leagues, specifically the National Football League.
Furthermore, our data-driven platform enables us to capture valuable insights on consumer behavior and preferences, which are increasingly valuable to our content providers. 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 sports leagues, especially the National Football League.
Our Growth Strategy We believe that we are at the early stages of our growth and that we are at an inflection point in the TV industry where 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.
Our Growth Strategies We believe that we are at the early stages of our growth and that we are at an inflection point in the TV industry where 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.
In doing so, content providers are expanding their audiences, which have shrunk on traditional TV because of ongoing cord-cutting. By aggregating a broad variety of content to deliver a comprehensive offering on our platform, we believe fuboTV is able to provide greater engagement and value to subscribers than content providers would otherwise be able to deliver independently.
In doing so, content providers are expanding their audiences, which have shrunk on traditional Pay TV because of ongoing cord-cutting. By aggregating a broad variety of content to deliver a comprehensive offering on our platform, we believe Fubo is able to provide greater engagement and value to subscribers than content providers would otherwise be able to deliver independently.
Our principal executive offices are located at 1290 Avenue of the Americas, New York, New York 10104, and our telephone number is (212) 672-0055. Our website address is at https://fubo.tv .
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. 12 Available Information Our internet website address is www.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. 12 Table of Conte nts Available Information Our internet website address is www.fubo.tv.
We provide basic plans with the flexibility for consumers to purchase the Attachments best suited for them. Our base plan, fubo Starter, includes over 100+ channels, including many of the top Nielsen-rated networks, dozens of channels with sports, double digit news channels, and some popular entertainment channels.
We provide multiple plans with the flexibility for consumers to purchase the Attachments best suited for them. Our base plan, Fubo Pro, includes over 100+ channels, including many of the top Nielsen-rated networks, dozens of channels with sports, double digit news channels, and some popular entertainment channels.
Our base plan includes a broad mix of channels, including top 50 Nielsen-ranked networks, across sports, news, and entertainment. At the core of our offering are our proprietary technology platform, purpose-built for live TV and sports viewership, and our first-party data. Our proprietary technology stack has enabled us to regularly offer new features and functionality.
Our base plan, Fubo Pro, includes a broad mix of channels, including top Nielsen-ranked networks, across sports, news, and entertainment. At the core of our offering is our proprietary technology platform, purpose-built for live TV and sports viewership, and our first-party data. Our proprietary technology stack has enabled us to regularly offer new features and functionality.
The data also enables us to provide users with real-time personalized discovery of live and on-demand programming and to surface relevant content for our users. Our growth strategy is to acquire subscribers who are attracted to our sports offering and can find with us a compelling sport, news, and entertainment viewing alternative to a traditional Pay TV service.
The data also enables us to provide users with real-time personalized discovery of live and on-demand programming and to surface relevant content for our users. 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 also plan to continue to expand 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 : Because we have the direct-to-consumer relationship and have the ability to analyze all the content that our subscribers consume, we believe we can continue to drive better subscriber experiences.
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 the 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.
Advertisers also benefit from combining traditional TV advertising formats with the advantages of digital advertising including measurability, relevancy, and interactivity. Content Providers Our TV streaming platform creates the opportunity for content providers to monetize and distribute their content to our highly engaged audience.
Advertisers also benefit from combining traditional TV advertising formats with the advantages of digital advertising including measurability, relevancy, and interactivity. 7 Table of Conte nts Content Providers Our TV streaming platform creates the opportunity for content providers to monetize and distribute their content to our highly engaged audience.
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.
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. 13 Table of Conte nts
These laws and regulations, and their application to our business, are increasingly shifting and expanding. Compliance with these laws and regulations, such as the California Consumer Privacy Act and the European Union General Data Protection Regulation 2016/679 (the “GDPR”) could affect our business, and their potential impact is unknown.
These laws and regulations, and their application to our business, are increasingly shifting and expanding. Compliance with these laws and regulations, such as the California Consumer Privacy Act ("CCPA"), as amended by the California Privacy Rights Act ("CPRA"), and the European Union General Data Protection Regulation 2016/679 (the “GDPR”) could affect our business, and their potential impact is unknown.
We actively engage those subscribers by providing a seamless Pay TV replacement through a personalized easy-to-use streaming product at a significantly lower cost than traditional Pay TV providers. We then monetize our audience through subscription fees and our digital advertising offering.
We actively engage those subscribers by providing a seamless Pay TV replacement through a personalized easy-to-use streaming product at a lower cost with greater convenience and flexibility than traditional Pay TV providers. We then monetize our audience through subscription fees and our digital advertising offering.
We drive our business model with three core strategies: ● Grow our paid subscriber base ● Optimize engagement and retention ● Increase monetization Our Offerings Our offerings address the needs of the parties in the TV streaming ecosystem. 7 Subscribers We offer consumers a live TV streaming platform for sports, news, and entertainment.
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 Our offerings address the needs of the parties in the TV streaming ecosystem. Subscribers We offer consumers a live TV streaming platform for sports, news, and entertainment.
Patents and Patent Applications As of December 31, 2021, we had four issued U.S. patents, three non-provisional U.S. patent applications, one U.S. design patent application, 18 granted international design registrations in three international design patents, three granted international patents and seven international patent applications pending.
Patents and Patent Applications As of December 31, 2022, we had four issued U.S. patents, one non-provisional U.S. patent application, one U.S. design patent application, 18 granted international design registrations in three international design patents, three granted international patents, and 19 international patent applications pending.
We rely on a combination of patent, trademark, copyright and other intellectual property laws, confidentiality agreements and license agreements to protect our intellectual property rights. We also license certain third-party technology for use in conjunction with our products.
Intellectual Property Our intellectual property is an essential 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 our intellectual property rights. We also license certain third-party technology for use in conjunction with our products.
We have subsequently reopened our offices on an optional basis, however, most of our employees continue to work remotely, and, in the long term, we expect some personnel to continue to do so on a regular basis.
Our offices have subsequently reopened and the majority of our employees have returned to office on a hybrid schedule; however some of our employees continue to work remotely, and, in the long term, we expect some personnel to continue to do so on a regular basis.
Unlike other popular Video-on-Demand-only (“VOD”) streaming services, live TV streaming requires sophisticated infrastructure and technology, given the nuances associated with an offering of live programming that refreshes regularly. Today, our proprietary video delivery platform supports all major sports leagues and entertainment content owner delivery requirements. We offer multi-view on Apple TV, which enables subscribers to watch four live streams simultaneously.
Unlike other popular Video-on-Demand-only (“VOD”) streaming services, live TV streaming requires sophisticated infrastructure and technology, given the nuances associated with an offering of live programming that refreshes regularly. Today, our proprietary video delivery platform supports all major sports leagues and entertainment content owner delivery requirements.
As of December 31, 2021, we had 37 trademarks registered globally. “fuboTV” is a registered trademark in the United States and the European Union. Competition The TV streaming market continues to grow and evolve as more viewers shift from traditional Pay TV to streaming. There is significant competition in the TV market for users, advertisers, and broadcasters.
As of December 31, 2022, we had 37 trademarks registered globally. “fuboTV” is a registered trademark in the United States and the European Union. 9 Table of Conte nts Competition The TV streaming market continues to grow and evolve as more viewers shift from traditional Pay TV to streaming.
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.
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.
We are increasingly monetizing this engagement through advertising on the fuboTV 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 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.
Following the Merger, we changed our name from “FaceBank Group, Inc.” to “fuboTV Inc.,” and we changed the name of fuboTV Sub to “fuboTV Media, Inc.” The combined company operates under the name “fuboTV,” and our trading symbol is “FUBO.” See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Merger with fuboTV Sub” in Part II, Item 7 in this Annual Report for a further description of the Merger.
Following the Merger, we changed our name from “FaceBank Group, Inc.” to “fuboTV Inc.,” and we changed the name of fuboTV Sub to “fuboTV Media, Inc.” The combined company operates under the name “Fubo,” and our trading symbol is “FUBO.” See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Merger with fuboTV Sub” in Part II, Item 7 in this Annual Report for a further description of the Merger. 11 Table of Conte nts 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.
We principally compete with Pay TV operators, such as Comcast, Cox and Altice, along with other virtual multichannel video programming distributors (“vMVPDs”), such as YouTube TV, Hulu Live and Sling TV.
There is significant competition in the TV market for users, advertisers, and broadcasters. We principally compete with Pay TV operators, such as Comcast, Cox and Altice, along with other virtual multichannel video programming distributors (“vMVPDs”), such as YouTube TV, Hulu Live and Sling TV.
We believe consumers are increasingly favoring the superior customer experience, lower cost, and better value of streaming services. Sports and news content have been a key driver for pay TV operators to retain and grow audiences. Most streaming subscription services have primarily focused on entertainment content offerings, requiring sports fans to, until recently, remain tethered to the pay TV ecosystem.
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.
We believe this creates 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 available for purchase that include additional content or enhanced functionality (“Attachments”) best suited to their preferences.
Yet, despite being a growing share of TV consumption, streaming is still in the early stages of adoption. We believe this creates 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 French employees are covered by the national collective bargaining agreement for the consulting and engineering activities in France. We view our employees as central to the success of our business and achieving our mission. We are continuously focused on our culture, recruiting, retaining and motivating our employees, employee development and engagement, diversity, equity and inclusion.
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.
Any actual or perceived failure to comply with these laws and regulations may result in investigations, claims and proceedings, regulatory fines or penalties, damages for breach of contract, or orders that require us to change our business practices, including the way we process data. 11 We are also subject to breach notification laws, including the GDPR, in the jurisdictions in which we operate, and we may be subject to litigation and regulatory enforcement actions as a result of any data breach or other unauthorized access to or acquisition or loss of personal information.
Any actual or perceived failure to comply with these laws and regulations may result in investigations, claims and proceedings, regulatory fines or penalties, damages for breach of contract, or orders that require us to change our business practices, including the way we process data.
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. We anticipate similar trends and user behavior for our recently launched Fubo Sportsbook given the seasonal nature of sports.
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.
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. ● Continue to invest in our technology and data capabilities: We believe that our technology platform, coupled with our content offering, differentiates us, and we will continue to invest in both to drive the subscriber experience.
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. 8 Table of Conte nts • Continue to invest in our technology and data capabilities: We believe that our technology platform, coupled with our content offering, differentiates us.
As part of these efforts, we also formed a Diversity Council in August 2020, comprised of different team members throughout the organization, who work together to recommend and help drive diversity and inclusion initiatives within the company.
In 2020, we formed a Diversity, Engagement and Belonging Council, comprised of different team members throughout various levels of the organization, who recommend and help organize diversity and inclusion initiatives within the company.
We will continue to file and prosecute patent applications when appropriate to attempt to protect our rights in our proprietary technologies.
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 our rights in our proprietary technologies.
As we expand globally, including through our acquisitions of Molotov in France and Edisn in India during 2021, we are increasingly focused on these goals. We believe the different backgrounds, traditions, views and talents each of our employees brings to fuboTV enrich the company as a whole and help us achieve executional excellence.
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.
Subscribers have the option to add premium channels and additional channel packages, as well as upgrade Attachments such as more DVR storage with Cloud DVR Plus and additional simultaneous streams with Family Share.
Subscribers have the option to add premium channels and additional channel packages, as well as upgrade other Attachments such as more DVR storage with Cloud DVR Plus and additional simultaneous streams with Family Share. Advertisers As cord cutting continues and traditional Pay TV viewers decline, advertisers are increasingly allocating their ad budgets to Over-the-Top (“OTT”) platforms to reach these audiences.
Item 1. Business. Our Mission Our mission is to build the world’s leading global live TV streaming platform with the greatest breadth of premium content, interactivity and integrated wagering. Overview We are a sports-first, live TV streaming company, offering subscribers access to tens of thousands of live sporting events annually as well as leading news and entertainment content.
Item 1. Business. Our Mission Our mission is to build the world’s leading global live TV streaming platform with the greatest breadth of premium content and interactivity.
In 2021, 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 has started to expand into international markets, with operations in Canada, Spain and France. 6 We are continuing to invest to accelerate our expansion into the sports wagering space, which we believe will be a complementary revenue stream to our current business model.
In 2021 and 2022, 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 has started to expand into international markets, with operations in Canada, Spain and France. Consistent with our focus on interactivity, we completed the acquisition of Edisn Inc.
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.
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.
(“Edisn”), an AI-powered computer vision platform with patent-pending video recognition technologies based in Bangalore, India, in December 2021. With Edisn, we expect to expand our data science and engineering organization globally, while strengthening our technology capabilities and accelerating innovation.
(“Edisn”), an AI-powered computer vision platform with patent-pending video recognition technologies based in Bangalore, India, in December 2021.
As consumers continue to spend more time streaming content, we also believe that advertisers will allocate more dollars away from traditional linear TV advertising spend and towards streaming services. Yet, despite being a growing share of TV consumption, streaming is still in the early stages of adoption.
The rate of Pay TV cord-cutting (termination of a cable or satellite subscription) has continued to accelerate in the United States, while consumers have increasingly favored the streaming experience. As consumers continue to spend more time streaming content, we also believe that advertisers will allocate more dollars away from traditional linear TV advertising spend and towards streaming services.
We also provide several programs and benefits to our employees designed to recruit, retain and incentivize high quality talent, including stock-based compensation awards and cash-based performance bonus awards under our long-term incentive plans, as well as health and welfare benefits and programs, and retirement savings plans. 10 In response to the COVID-19 pandemic, we have taken a number of precautionary measures to protect the health and safety of our employees, including by transitioning our workforce to remote working as we temporarily closed our offices beginning in March 2020.
In response to the COVID-19 pandemic, we took a number of precautionary measures to protect the health and safety of our employees, including by initially transitioning our workforce to remote working as we temporarily closed our offices beginning in March 2020.
Advertisers As cord cutting continues and traditional Pay TV viewers decline, advertisers are increasingly allocating their ad budgets to Over-the-Top (“OTT”) platforms to reach these audiences. fuboTV’s sports-first live TV platform offers advertisers a growing and increasingly valuable live audience and provides un-skippable ad inventory on high quality content.
Fubo’s sports-first live TV platform offers advertisers a growing and increasingly valuable live audience and provides un-skippable ad inventory on high quality content.
The issued and granted patents expire in 2033 and 2038, and the international design registrations have expiration 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.
The issued and granted patents expire in 2033 and 2038, the pending patent applications, if granted, will expire in 2038 and 2041, and the international design registrations have expiration dates ranging from 2035 to 2045.
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. Traditional live TV accounts for the majority of TV viewing hours for U.S. households, however, the proportion is declining as customers continue cutting the cord.
Traditional live TV accounts for the majority of TV viewing hours for U.S. households, however, the proportion is declining as customers continue cutting the cord. We believe consumers are increasingly favoring the superior customer experience, lower cost, and better value of streaming services.
Human Capital As of December 31, 2021, we had approximately 530 employees, of which approximately 400 were located in North America and 130 were located in Europe and India. 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.
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.
Additionally, we further expanded internationally in 2021 through our acquisition of Molotov SAS (“Molotov”) a video streaming platform based in Paris, France. With Molotov, we are augmenting our technology capabilities, enabling us to launch our interactive sports and entertainment streaming platform more efficiently on a global scale.
With Molotov, we have augmented our technology capabilities, which we believe will enable us to launch our interactive sports and entertainment streaming platform more efficiently on a global scale. 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.
We believe this is a market that fuboTV was well-positioned to enter given our unique live sport streaming offering, our deep knowledge of sports marketing and underlying technology platform. ● Expand Internationally: Outside of the United States, we currently operate in Canada, Spain and, through our acquisition of Molotov in 2021, France.
We anticipate this initiative will drive significant cost savings over the coming years as well as increase 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.
We will continue to utilize and analyze the data we have collected to help us become more efficient with our marketing campaigns relative to spend. ● Upsell and Retain Existing Subscribers : By improving our Attachment offerings, we have been able to steadily increase the quantity of Attachments sold within our subscriber base while continuing to improve our overall retention rates.
We will 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 $72.74 and $70.50 for the year ended December 31, 2022 and 2021, respectively.
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Our platform, fuboTV, allows customers to access content through streaming devices and on SmartTVs, mobile phones, tablets, and computers.
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Overview We are a sports-first, cable TV replacement product, offering subscribers access to tens of thousands of live sporting events annually, as well as leading news and entertainment content, both live and on demand. Fubo allows customers to access content through streaming devices and on SmartTVs, mobile phones, tablets, and computers.
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The number of cable TV cord-cutting households (those that terminate their cable or satellite subscription) and cable TV cord-never households (those that have never subscribed to traditional cable or satellite) continues to accelerate in the United States, as cable and satellite subscribers increasingly favor the streaming experience.
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We offer multi-view on Apple TV, which enables subscribers to watch up to four live streams simultaneously, and we offer FanView on multiple devices, which allows subscribers to engage with interactive elements and display game data alongside their chosen content.
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Our technology enables us to meet blackout and geographical rights requirements with zip-code-level fidelity and deliver conforming streams on a per-user, per-device basis, protected by industry-standard Digital Rights Management (“DRM”) technology.
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With Edisn, we have expanded, and continue to expand, our data science and engineering organization globally, while strengthening our technology capabilities and accelerating innovation. 6 Table of Conte nts We also acquired Molotov SAS (“Molotov”), a video streaming platform based in Paris, France, in December 2021.
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In February 2021, we completed the acquisition of Vigtory, Inc. (“Vigtory”), which was renamed fubo Gaming Inc. (“fubo Gaming”), augmenting our video technology platform with Vigtory’s sportsbook capabilities and pipeline of market access agreements.
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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.
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Throughout 2021, we introduced our intended online wagering strategy, including the roll-out in the third quarter of 2021 of predictive, free-to-play games, which are integrated into select sports content on our TV streaming platform, and the launch in the fourth quarter of 2021 of fubo Gaming’s business-to-consumer online mobile sportsbook (“Fubo Sportsbook”) in Iowa and Arizona.
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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, 2022, Fubo had approximately 1.445 million paid subscribers in the United States and Canada (“North America” or “NA”) and approximately 420,000 paid subscribers in Spain and France (“Rest of World” or “ROW”), up from approximately 1.122 million in NA and approximately 193,000 in ROW as of December 31, 2021.
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We are planning to launch Fubo Sportsbook in additional states during 2022, subject to obtaining requisite regulatory approvals. Fubo Sportsbook is purpose-built to integrate with fuboTV, creating a personalized omniscreen experience that turns passive viewers into active and engaged participants. Consistent with our focus on interactivity, we completed the acquisition of Edisn Inc.
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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 18.2% in during the year ended December 31, 2022.
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We believe our expansion into wagering and interactivity is core to this model. We believe free-to-play predictive games enhance the sports streaming experience - while also providing a bridge between video and our sportsbook.
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Our ROW ARPU was $6.14 for the year ended December 31, 2022. We drive ARPU expansion through price-increases, attachment sales, and advertising revenue growth. By pricing against content portfolio adjustments, we aim to deliver value through our offerings.
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We expect the integration of gaming with our expansive live sports coverage will create a flywheel that lifts engagement and retention, expands advertising revenue through increased viewership, and creates additional opportunities for Attachment sales.
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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 year ended December 31, 2022, Fubo’s advertising revenue was approximately $101.7 million, up from approximately $73.7 million in December 31, 2021.
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We have identified potential growth opportunities, both in current markets and adjacent markets, that we believe may provide additional upside to our business model.
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We continue to invest and build a scalable, highly automated technology infrastructure, that’s purpose-built to give us a structural advantage to help drive subscriber acquisition, content strategy and product decisions. We are focused on adding interactive features that turn passive viewers into active participants.
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The key elements to our growth strategy include: ● Continue to grow our subscriber base : As of December 31, 2021, fuboTV had 1,315,433 paid subscribers, including 185,626 added through the acquisition of Molotov, up from approximately 547,880 as of December 31, 2020.
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Additionally, in 2022 we initiated the integration of the Fubo and Molotov platforms together into a Unified Platform, with the goal of launching in the United States in 2023.
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Our Sales and Marketing expenses relative to total revenues was approximately 22.3% in 2021 and we believe there is significant opportunity to accelerate subscriber acquisition by increasing our marketing expenditures on an absolute dollar basis.
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Our ability to license content from broadcasters 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 a diverse group of individuals, creatives, technologists, analysts and more. Some of us love sports, some binge the news, others prefer rom-coms.
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By piggybacking on to our existing offerings and not meaningfully increasing our cost basis while increasing revenues, Attachments increase our margins. Through each Attachment, we provide incremental value to our paying subscribers and are able to capitalize on the incremental dollars earned through our ability to upsell.
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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, 2022, we had approximately 510 employees globally, of which approximately 360 were located in North America and approximately 150 were located in Europe and India.
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We plan to continue to enhance our product for sports viewers by increasing the number of 4K streams and enhancing the image quality of fast-paced games.
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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.
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We have also rolled out personalization capabilities for our subscribers, including Favorites List and User Profiles, which allow us to enhance our recommendation technology, thereby potentially increasing subscriber engagement and satisfaction. ● Continue to enter adjacent markets, including wagering: fuboTV, through our collaborations with premier programmers, content providers and advertisers, is very closely aligned with several adjacent markets.
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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, “ask me anything” sessions, 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.
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For example, our current sports-first platform lent itself to our recent entrance into the sports wagering market with the launch of Fubo Sportsbook in two states in the fourth quarter of 2021.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIn addition, the U.S. government may enact significant changes to the taxation of business entities including, among others, an increase in the corporate income tax rate Furthermore, governmental agencies in domestic and international jurisdictions in which we and our affiliates do business, as well as the Organization for Economic Cooperation and Development, have recently focused on issues related to the taxation of multinational corporations (such as “base erosion and profit shifting”) and proposed potential changes to existing legislation (such as the imposition of minimum taxes).We are currently unable to predict whether such changes will occur and, if so, the ultimate impact on our business 35 Social responsibility concerns and public opinion can significantly influence the regulation of sports wagering and impact responsible gaming requirements, each of which could impact our business and could adversely affect our operations.
Biggest changeFurthermore, governmental agencies in domestic and international jurisdictions in which we and our affiliates do business, as well as the Organization for Economic Cooperation and Development, have recently focused on issues related to the taxation of multinational corporations (such as “base erosion and profit shifting”) and proposed potential changes to existing legislation (such as the imposition of minimum taxes).
Content providers may also only provide their content on a service that includes a minimum number of channels from other providers or require that we only provide their content in specific service tiers that include a specific mix of programming.
Content providers may also provide their content only on a service that includes a minimum number of channels from other providers or require that we only provide their content in specific service tiers that include a specific mix of programming.
We attempt to protect our intellectual property under patent, trade secret, trademark, and copyright law through a combination of intellectual property registration, employee, third-party assignment and nondisclosure agreements, other contractual restrictions, technological measures, and other methods.
We attempt to protect our intellectual property under patent, trade secret, trademark, and copyright law through a combination of intellectual property registration, employee and third-party assignment and nondisclosure agreements, other contractual restrictions, technological measures, and other methods.
We may be unable, without significant cost or at all, to prevent third parties from acquiring domain names that are similar to, infringe upon or otherwise decrease the value of our trademarks and other proprietary rights. 44 Our use of open-source software could impose limitations on our ability to commercialize our platform. We incorporate open-source software in our platform.
We may be unable, without significant cost or at all, to prevent third parties from acquiring domain names that are similar to, or that infringe upon or otherwise decrease the value of our trademarks and other proprietary rights. Our use of open-source software could impose limitations on our ability to commercialize our platform. We incorporate open-source software in our platform.
Likewise, our system for predicting subscriber content preferences is based on advanced data analytics systems and our proprietary algorithms. We have invested, and will continue to invest, significant resources in refining these technologies; however, we cannot assure you that such investments will yield an attractive return or that such refinements will be effective.
Likewise, our system for predicting subscriber content preferences is based on advanced data analytics systems and our proprietary algorithms. We have invested, and plan to continue to invest, significant resources in refining these technologies; however, we cannot assure you that such investments will yield an attractive return or that such refinements will be effective.
If we are unable to execute on building a strong brand, it may be difficult to differentiate our business and platform from our competitors in the marketplace; therefore, our ability to attract and retain subscribers may be adversely affected and our business may be harmed. 20 We rely upon a number of partners to make our service available on their devices.
If we are unable to execute on building a strong brand, it may be difficult to differentiate our business and platform from our competitors in the marketplace; therefore, our ability to attract and retain subscribers may be adversely affected and our business may be harmed. We rely upon a number of partners to make our service available on their devices.
Any actual or perceived inability to adequately address privacy, data protection or security-related concerns, even if unfounded, or to successfully negotiate privacy, data protection or security-related contractual terms with content publishers, card associations, advertisers, or others, or to comply with applicable laws, regulations and other obligations relating to privacy, data protection, and security, could result in additional cost and liability to us.
Any actual or perceived inability to adequately address privacy, consumer protection, data protection or security-related concerns, even if unfounded, or to successfully negotiate privacy, data protection, consumer protection or security-related contractual terms with content publishers, card associations, advertisers, or others, or to comply with applicable laws, regulations and other obligations relating to privacy, data protection, and security, could result in additional cost and liability to us.
If we are unable to obtain necessary or desirable third-party technology licenses, our ability to develop platform enhancements may be impaired. We utilize commercially available off-the-shelf technology in the development of our platform. As we continue to introduce new features or improvements to our platform, we may be required to license additional technologies from third parties.
If we are unable to obtain necessary or desirable third-party technology licenses, our ability to develop platform enhancements may be impaired. We utilize commercially available off-the-shelf technology in the development of our platform. As we introduce new features or improvements to our platform, we may be required to license additional technologies from third parties.
We expect to receive formal and informal inquiries from government authorities and regulators from time to time, including securities authorities, tax authorities and gaming regulators, regarding our compliance with laws and other matters. We expect to continue to be the subject of investigations and audits in the future as we continue to grow and expand our operations.
We expect to receive formal and informal inquiries from government authorities and regulators from time to time, including securities authorities, tax authorities and, potentially, gaming regulators, regarding our compliance with laws and other matters. We expect to continue to be the subject of investigations and audits in the future as we continue to grow and expand our operations.
To attract and retain subscribers, we need to be able to respond efficiently to changes in consumer tastes and preferences and continue to increase the type and number of content offerings. Effective monetization requires us to continue to update the features and functionality of our streaming platform for subscribers and advertisers.
To attract and retain subscribers, we need to be able to respond efficiently to changes in consumer tastes and preferences and to further increase the type and number of content offerings. Effective monetization requires us to continue to update the features and functionality of our streaming platform for subscribers and advertisers.
We also experience higher advertising sales during the fourth quarter of each calendar year due to greater advertiser demand during the holiday season, but, on the other hand, also incur greater marketing expenses as we attempt to attract new subscribers to our platform.
We also typically experience higher advertising sales during the fourth quarter of each calendar year due to greater advertiser demand during the holiday season, but, on the other hand, also typically incur greater marketing expenses as we attempt to attract new subscribers to our platform.
In many cases, these competitors have the financial resources to subsidize the cost of their streaming devices in order to promote their other products and services making it harder for us to acquire new subscribers and increase hours streamed.
In many cases, these competitors have the financial resources to subsidize the cost of their streaming services in order to promote their other products and services making it harder for us to acquire new subscribers and increase hours streamed.
In addition to other risk factors discussed herein, factors that may contribute to the variability of our quarterly and annual results include: ● our ability to retain and grow our subscriber base, as well as increase engagement among new and existing subscribers; ● our ability to maintain effective pricing practices, in response to the competitive markets in which we operate or other macroeconomic factors, such as inflation or increased taxes; 15 ● the addition or loss of popular content or channels, including our ability to enter into new content deals or negotiate renewals with our content providers on terms that are favorable to us, or at all; ● our ability to effectively manage our growth; ● our ability to attract and retain existing advertisers; ● seasonal, cyclical or other shifts in revenue and expenses; ● our revenue mix, which drives gross profit; ● the entrance of new competitors or competitive products or services, whether by established or new companies; ● our ability to keep pace with changes in technology and our competitors, and the timing of the launch of new or updated products, content or features; ● interruptions in service, whether or not we are responsible for such interruptions, and any related impact on our reputation; ● our ability to pursue and appropriately time our entry into new geographic or content markets and, if pursued, our management of this expansion; ● costs associated with defending any litigation, including intellectual property infringement litigation; ● the impact of general economic conditions on our revenue and expenses; and ● changes in regulations affecting our business.
In addition to other risk factors discussed herein, factors that may contribute to the variability of our quarterly and annual results include: • our ability to retain and grow our subscriber base, as well as increase engagement among new and existing subscribers; • our ability to maintain effective pricing practices, in response to the competitive markets in which we operate or other macroeconomic factors, such as inflation or increased taxes; • the addition or loss of popular content or channels, including our ability to enter into new content deals or negotiate renewals with our content providers on terms that are favorable to us, or at all; • our ability to effectively manage our growth; • our ability to attract and retain existing advertisers; • seasonal, cyclical or other shifts in revenue and expenses; • our revenue mix; • the entrance of new competitors or competitive products or services, whether by established or new companies; • our ability to keep pace with changes in technology and our competitors, and the timing of the launch of new or updated products, content or features; • interruptions in service, whether or not we are responsible for such interruptions, and any related impact on our reputation; • our ability to pursue and appropriately time our entry into new geographic or content markets and, if pursued, our management of this expansion; • costs associated with defending any litigation, including intellectual property infringement litigation; • the impact of general economic conditions on our revenue and expenses; and • changes in regulations affecting our business.
Complying with the GDPR, CCPA, VCDPA, and other laws, regulations, and other obligations relating to privacy, data protection, data localization or security may cause us to incur substantial operational costs or require us to modify our data handling practices.
Complying with the GDPR, CCPA, VCDPA, and other laws, regulations, and other obligations relating to privacy, consumer protection, data protection, data localization or security may cause us to incur substantial operational costs or require us to modify our data handling practices.
While the existence of our patent portfolio may deter some plaintiffs from asserting claims against us, from time to time we have faced, and expect to continue to face, allegations from “non-practicing entities.” Because these non-practicing entities have no relevant product revenue, and they exist primarily for the purpose of monetizing their patent portfolio through licensing and litigation, they may not be deterred by our own issued patents and pending patent applications in bringing intellectual property rights claims against us.
While the existence of our patent portfolio may deter some plaintiffs from asserting claims against us, from time to time we have faced, and expect in the future to face, allegations from “non-practicing entities.” Because these non-practicing entities have no relevant product revenue, and they exist primarily for the purpose of monetizing their patent portfolio through licensing and litigation, they may not be deterred by our own issued patents and pending patent applications in bringing intellectual property rights claims against us.
Our business may not continue to generate cash flow from operations in the future sufficient to both (i) satisfy our existing and future obligations to our creditors and (ii) allow us to make necessary capital expenditures.
Our business may not generate cash flow from operations in the future sufficient to both (i) satisfy our existing and future obligations to our creditors and (ii) allow us to make necessary capital expenditures.
The factors include: ● the impact on global and regional economies as a result of the COVID-19 pandemic; ● variations in our operating results; ● variations between our actual operating results and the expectations of securities analysts, investors and the financial community; ● announcements of developments affecting our business, systems or expansion plans by us or others; ● technical factors in the public trading market for our stock that may produce price movements that may or may not comport with macro, industry or company-specific fundamentals, including, without limitation, the sentiment of retail investors (including as it may be expressed on financial trading and other social media sites), the amount and status of short interest in our securities, access to margin debt, trading in options and other derivatives on our common stock, fractional share trading, and other technical trading factors or strategies; ● competition, including the introduction of new competitors, their pricing strategies and services; ● announcements regarding stock repurchases and sales of our equity and debt securities; ● market volatility in general; ● the level of demand for our stock, including the amount of short interest in our stock; and ● the operating results of our competitors.
The factors include: • global and regional macroeconomic conditions, including as a result of the COVID-19 pandemic; • variations in our operating results; • variations between our actual operating results and the expectations of securities analysts, investors and the financial community; • announcements of developments affecting our business, systems or expansion plans by us or others; • technical factors in the public trading market for our stock that may produce price movements that may or may not comport with macro, industry or company-specific fundamentals, including, without limitation, the sentiment of retail investors (including as it may be expressed on financial trading and other social media sites), the amount and status of short interest in our securities, access to margin debt, trading in options and other derivatives on our common stock, fractional share trading, and other technical trading factors or strategies; • competition, including the introduction of new competitors, their pricing strategies and services; • announcements regarding stock repurchases and sales of our equity and debt securities; • market volatility in general; • the level of demand for our stock, including the amount of short interest in our stock; and • the operating results of our competitors.
If we do not grow as expected, given, in particular, that our content costs are largely fixed in nature and contracted over several years, we may not be able to adjust our expenditures or increase our (per subscriber) revenues commensurate with the lowered growth rate such that our margins, liquidity and results of operations may be adversely impacted.
If we do not grow as expected, given, in particular, that our content costs are largely contracted over several years, we may not be able to adjust our expenditures or increase our (per subscriber) revenues commensurate with the lowered growth rate such that our margins, liquidity and results of operations may be adversely impacted.
If we raise additional funds through future issuances of equity or convertible debt securities, including pursuant to our shelf registration statement on Form S-3, our then existing shareholders could suffer significant dilution, and any new equity securities we issue could have rights, preferences and privileges superior to those of holders of our common stock.
If we raise additional funds through future issuances of equity or convertible debt securities, including pursuant to our shelf registration statements on Form S-3, our then existing shareholders could suffer significant dilution, and any new equity securities we issue could have rights, preferences and privileges superior to those of holders of our common stock.
To the extent that overall economic conditions reduce spending on discretionary activities, our ability to retain current and obtain new subscribers could be hindered, which could reduce our subscription and gaming revenue and negatively impact our business. Changes in how we market our service could adversely affect our marketing expenses and subscription levels may be adversely affected.
To the extent that overall economic conditions continue to reduce spending on discretionary activities, our ability to retain current and obtain new subscribers could be hindered, which could reduce our revenue and negatively impact our business. Changes in how we market our service could adversely affect our marketing expenses and subscription levels may be adversely affected.
We anticipate that this seasonal impact on revenue and gross profit is likely to continue, and any shortfall in expected revenue due to macroeconomic conditions, a decline in the effectiveness of our promotional activities, actions by our competitors, or for any other reason, would cause our results of operations to suffer significantly.
We anticipate that this seasonal impact on revenue is likely to continue, and any shortfall in expected revenue due to macroeconomic conditions, a decline in the effectiveness of our promotional activities, actions by our competitors, or for any other reason, would cause our results of operations to suffer significantly.
We expect competition in TV streaming from the large technology companies and service operators described above, as well as new and growing companies, to increase in the future. This increased competition could result in pricing pressure, lower revenue and gross profit or the failure of our platform to gain or maintain broad market acceptance.
We expect competition in TV streaming from the large technology companies and service operators described above, as well as new and growing companies, to increase in the future. This increased competition could result in pricing pressure, lower revenue or the failure of our platform to gain or maintain broad market acceptance.
These competitors offer content and other advertising mediums that may be more attractive to advertisers than our streaming platform. These competitors are often very large and have more advertising experience and financial resources than we do, which may adversely affect our ability to compete for advertisers and may result in lower revenue and gross profit from advertising.
These competitors offer content and other advertising mediums that may be more attractive to advertisers than our streaming platform. These competitors are often very large and have more advertising experience and financial resources than we do, which may adversely affect our ability to compete for advertisers and may result in lower revenue from advertising.
We may sell common stock, convertible securities and other equity securities in one or more transactions at prices and in a manner as we may determine from time to time, including pursuant to our shelf registration statement on Form S-3, which could result in substantial dilution to our existing shareholders.
We may sell common stock, convertible securities and other equity securities in one or more transactions at prices and in a manner as we may determine from time to time, including pursuant to our shelf registration statements on Form S-3, which could result in substantial dilution to our existing shareholders.
Furthermore, devices are manufactured and sold by entities other than fuboTV, and while these entities should be responsible for the devices’ performance, the connection between these devices and fuboTV may nonetheless result in consumer dissatisfaction toward fuboTV and such dissatisfaction could result in claims against us or otherwise adversely impact our business.
Furthermore, devices are manufactured and sold by entities other than Fubo, and while these entities should be responsible for the devices’ performance, the connection between these devices and Fubo may nonetheless result in consumer dissatisfaction toward Fubo and such dissatisfaction could result in claims against us or otherwise adversely impact our business.
From time to time, companies that incorporate open-source software into their products have faced claims challenging the ownership of open-source software and/or compliance with open-source license terms. Therefore, we could be subject to suits by parties claiming ownership of what we believe to be open-source software or non-compliance with open-source licensing terms.
From time to time, companies that incorporate open-source software into their proprietary software and products have faced claims challenging the ownership of their proprietary software and/or compliance with open-source license terms. Therefore, we could be subject to suits by parties claiming ownership of what we believe to be our proprietary software or non-compliance with open-source licensing terms.
We are expanding our operations internationally, and as our international offering evolves, we are managing and adjusting our business to address varied content offerings, consumer customs and practices, in particular those dealing with e-commerce and streaming video, as well as differing legal and regulatory environments.
We have been expanding our operations internationally, and as our international offering evolves, we are managing and adjusting our business to address varied content offerings, consumer customs and practices, in particular those dealing with e-commerce and streaming video, as well as differing legal and regulatory environments.
Similarly, some service operators, such as Comcast and Cablevision, offer TV streaming applications as part of their cable service plans and can leverage their existing consumer bases, installation networks, broadband delivery networks and name recognition to gain traction in the TV streaming market.
Similarly, some service operators, such as Comcast and Altice, offer TV streaming applications as part of their cable service plans and can leverage their existing consumer bases, installation networks, broadband delivery networks and name recognition to gain traction in the TV streaming market.
During the COVID-19 pandemic, we may not be able to provide the same level of customer service that our subscribers are used to, which could negatively impact their perception of our platform resulting in an increase in cancellations. There can be no assurance that financing may be available on attractive terms, if at all.
During any resurgences of COVID-19, we may not be able to provide the same level of customer service that our subscribers are used to, which could negatively impact their perception of our platform resulting in an increase in cancellations. There can be no assurance that financing may be available on attractive terms, if at all.
The Federal Trade Commission has also revised its rules implementing the Children’s Online Privacy Protection Act, or COPPA Rules, broadening the applicability of the COPPA Rules, including by expanding the types of information that are subject to these regulations.
The Federal Trade Commission ("FTC") has also revised its rules implementing the Children’s Online Privacy Protection Act ("COPPA Rules"), broadening the applicability of the COPPA Rules, including by expanding the types of information that are subject to these regulations.
If our technology, trademarks and other proprietary rights are not adequately protected to prevent use or appropriation by our competitors, the value of our brand and other intangible assets may be diminished, and our business may be adversely affected.
If our technology, trademarks and other proprietary rights are not adequately protected to prevent use or misappropriation by our competitors, the value of our brand and other intangible assets may be diminished, and our business may be adversely affected.
We cannot guarantee that the licenses currently held by our content providers or by us will continue to be available in the future at rates and on terms that are favorable or commercially reasonable or at all.
We cannot guarantee that the licenses currently held by our content providers or by us will be available in the future at rates and on terms that are favorable or commercially reasonable or at all.
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 and races.
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.
We currently offer subscribers the ability to receive streaming content through a host of Internet-connected screens, including TVs, digital video players, television set-top boxes and mobile devices. Some of our agreements with key distribution partners give distribution partners the ability to terminate their carriage of our service at any time.
We currently offer subscribers the ability to receive streaming content through a host of Internet-connected screens, including TVs, digital video players, television set-top boxes and mobile devices. Some of our agreements with key distribution partners give distribution partners the ability to terminate their carriage of our service.
In addition, the long-term and fixed cost nature of certain of our commitments may limit our flexibility in planning for or reacting to changes in our business and the market segments in which we operate.
In addition, the long-term nature of certain of our commitments may limit our flexibility in planning for or reacting to changes in our business and the market segments in which we operate.
Our financial performance is subject to worldwide economic conditions and their impact on levels of advertising spending. Expenditures by advertisers generally tend to reflect overall economic conditions, and to the extent that the economy continues to stagnate, reductions in spending by advertisers could have a material adverse impact on our business.
Our financial performance is subject to worldwide economic conditions, including rising levels of inflation, and their impact on levels of advertising spending. Expenditures by advertisers generally tend to reflect overall economic conditions, and to the extent that the economy continues to stagnate, reductions in spending by advertisers could have a material adverse impact on our business.
If advertisers, partners, or investors do not perceive our subscriber, geographic, or other demographic metrics to be accurate representations of our subscriber base, or if we discover material inaccuracies in our subscriber, geographic, or other demographic metrics, our reputation may be seriously harmed, and our business and operating results could be materially and adversely affected. 23 Preparing and forecasting our financial results requires us to make judgments and estimates which may differ materially from actual results, and if our operating and financial performance does not meet the guidance that we provide to the public, the market price of our common stock may decline.
If advertisers, partners, or investors do not perceive our subscriber, geographic, or other demographic metrics to be accurate representations of our subscriber base, or if we discover material inaccuracies in our subscriber, geographic, or other demographic metrics, our reputation may be seriously harmed, and our business and operating results could be materially and adversely affected. 24 Table of Conte nts Preparing and forecasting our financial results requires us to make judgments and estimates which may differ materially from actual results, and if our operating and financial performance does not meet the guidance that we provide to the public, the market price of our common stock may decline.
These systems may be subject to damage or interruption from, among other things, earthquakes, adverse weather conditions, other natural disasters, terrorist attacks, rogue employees, employees who are inattentive or careless and cause security vulnerabilities, power loss, telecommunications failures, and cybersecurity risks.
These systems may be subject to damage or interruption from, among other things, earthquakes, adverse weather conditions, other natural disasters, terrorist attacks, rogue employees, employees who are inattentive or careless and cause security vulnerabilities, power loss, telecommunications failures, and cybersecurity risks (for example, ransomware).
If one or more of these individuals leave, we may not be able to fully integrate new executives or replicate the current dynamic and working relationships that have developed among our senior management and other key personnel, and our operations could suffer. The impact of worldwide economic conditions may adversely affect our business, operating results, and financial condition.
If one or more of these individuals leave, we may not be able to fully integrate new executives or replicate the current dynamic and working relationships that have developed among our senior management and other key personnel, and our operations could suffer. 37 Table of Conte nts The impact of worldwide economic conditions may adversely affect our business, operating results, and financial condition.
We generate significantly higher levels of revenue and subscriber additions in the third and fourth quarters of the year, driven primarily by sports leagues, specifically the National Football League.
We generate significantly higher levels of revenue and subscriber additions in the third and fourth quarters of the year, driven primarily by sports leagues, especially the National Football League.
Additionally, rights holders, creators, performers, writers and their agents, or societies, unions, guilds, or legislative or regulatory bodies have created and may continue to create or attempt to create new rights or regulations that could require our content providers or us to enter into license agreements with, and pay royalties to, newly defined groups of rights holders, some of which may be difficult or impossible to identify.
Additionally, rights holders, creators, performers, writers and their agents, or societies, unions, guilds, or legislative or regulatory bodies have created and may in the future create or attempt to create new rights or regulations that could require our content providers or us to enter into license agreements with, and pay royalties to, newly defined groups of rights holders, some of which may be difficult or impossible to identify.
These and other provisions in the indenture could deter or prevent a third party from acquiring us even when the acquisition may be favorable to you. 46 Risks Related to Ownership of our Common Stock Our stock price is volatile.
These and other provisions in the indenture could deter or prevent a third party from acquiring us even when the acquisition may be favorable to you. 46 Table of Conte nts Risks Related to Ownership of our Common Stock Our stock price is volatile.
Increases in royalty rates or changes to other terms of these licenses could have an impact on how much our content providers charge us, and accordingly they may materially impact our business, operating results, and financial condition. Additionally, our content suppliers may develop their own streaming services and may be unwilling to provide us with access to certain content.
Increases in royalty rates or changes to other terms of these licenses could have an impact on how much our content providers charge us, and accordingly they may materially impact our business, operating results, and financial condition. 43 Table of Conte nts Additionally, our content suppliers may develop their own streaming services and may be unwilling to provide us with access to certain content.
Such jurisdictions also impose ongoing reporting and disclosure obligations, both on a periodic and ad hoc basis in response to material issues affecting the business.
Such jurisdictions also imposed ongoing reporting and disclosure obligations, both on a periodic and ad hoc basis in response to material issues affecting the business.
While we assess our quarterly and annual guidance and update such guidance when we think it is appropriate, unanticipated future volatility can cause actual results to vary significantly from our guidance, even where that guidance reflects a range of possible results. If we fail to effectively manage our growth, our business, operating results, and financial condition may suffer.
While we assess our quarterly and annual guidance and update such guidance when we think it is appropriate, unanticipated future volatility can cause actual results to vary significantly from our guidance, even where that guidance reflects a range of possible results. 17 Table of Conte nts If we fail to effectively manage our growth, our business, operating results, and financial condition may suffer.
Our ability to accept payments from our customers or facilitate withdrawals by them may be restricted by any introduction of legislation or regulations restricting financial transactions with online or mobile sports wagering operators or prohibiting the use of credit cards and other banking instruments for online or mobile sports wagering transactions, or by any other increase in the stringency of regulation of financial transactions, whether in general or in relation to the gambling industry in particular.
Our ability to facilitate withdrawals by them may be restricted by any introduction of legislation or regulations restricting financial transactions with online or mobile sports wagering operators or prohibiting the use of credit cards and other banking instruments for online or mobile sports wagering transactions, or by any other increase in the stringency of regulation of financial transactions, whether in general or in relation to the gambling industry in particular.
The imposition by state governments or local governments of sales tax collection obligations on out-of-state sellers could also create additional administrative burdens for us and decrease our future sales, which could adversely affect our business and operating results. We are subject to taxation-related risks in multiple jurisdictions.
The imposition by state governments or local governments of sales tax collection obligations on out-of-state sellers could also create additional administrative burdens for us and decrease our future sales, which could adversely affect our business and operating results. 33 Table of Conte nts We are subject to taxation-related risks in multiple jurisdictions.
In August 2020, the FASB published an Accounting Standards Update (“ASU”) 2020-06, which amends these accounting standards by reducing the number of accounting models for convertible instruments and limiting instances of separate accounting for the debt and equity or a derivative component of the convertible debt instruments.
In August 2020, the Financial Accounting Standards Board published an Accounting Standards Update (“ASU”) 2020-06, which amends these accounting standards by reducing the number of accounting models for convertible instruments and limiting instances of separate accounting for the debt and equity or a derivative component of the convertible debt instruments.
There is also a risk that civil and criminal proceedings, including class actions brought by or on behalf of prosecutors or public entities or incumbent monopoly providers, or private individuals, could be initiated against us, Internet service providers, credit card and other payment processors, advertisers and others involved in the sports wagering industry who partner with, service or work with or for us.
There is also a risk that civil and criminal proceedings, including class actions brought by or on behalf of prosecutors or public entities or incumbent monopoly providers, or private individuals, could be initiated against us, Internet service providers, credit card and other payment processors, advertisers and others involved in the sports wagering industry who partnered with, serviced or worked with or for us.
Although traditional TV advertisers have showed growing interest in OTT advertising, we cannot be certain that their interest will continue to increase or that they will not revert to traditional TV advertising, especially if our customers no longer stream TV or significantly reduce the amount of TV they stream either as a result of lifting of stay-at-home orders, the end of the COVID-19 pandemic or for other reasons.
Although traditional TV advertisers have showed growing interest in OTT advertising, we cannot be certain that their interest will continue to increase or that they will not revert to traditional TV advertising, especially if our customers no longer stream TV or significantly reduce the amount of TV they stream either as a result of the end of the COVID-19 pandemic or for other reasons.
The full extent to which the COVID-19 pandemic and the various responses to it impacts our business, operations and financial results will depend on numerous evolving factors that we may not be able to accurately predict, including: the duration and scope of the pandemic; governmental, business and individuals’ actions that have been and continue to be taken in response to the pandemic; the actions of professional and college sports leagues; the availability and cost to access the capital markets; the effect on our subscribers and subscriber demand for and ability to pay for our platform; disruptions or restrictions on our employees’ ability to work and travel; and interruptions or restrictions related to the provision of streaming services over the internet, including impacts on CDNs and streaming quality.
The full extent to which the COVID-19 pandemic and the various responses to it impacts our business, operations and financial results will depend on numerous evolving factors that we may not be able to accurately predict, including: the introduction of new strains of COVID-19; severity of future outbreaks; governmental, business and individuals’ actions that have been and continue to be taken in response to the pandemic; the actions of professional and college sports leagues; the availability and cost to access the capital markets; the effect on our subscribers and subscriber demand for and ability to pay for our platform; disruptions or restrictions on our employees’ ability to work and travel; and interruptions or restrictions related to the provision of streaming services over the internet, including impacts on CDNs and streaming quality.
We intend to continue to make significant investments to support planned business growth and may require additional funds to respond to business challenges, including the need to develop new features or enhance our existing platform, products and services, expand into additional markets around the world, improve our operating infrastructure or acquire complementary businesses, personnel and technologies.
We have made, and intend in the future to make, significant investments to support planned business growth and may require additional funds to respond to business challenges, including the need to develop new features or enhance our existing platform, products and services, expand into additional markets around the world, improve our operating infrastructure or acquire complementary businesses, personnel and technologies.
A past or future ownership change that materially limits our ability to use our historical net operating loss and tax credit carryforwards may harm our future operating results by effectively increasing our future tax obligations. 14 Our financial condition and results of operations could be adversely affected if we do not effectively manage our current or future debt.
A past or future ownership change that materially limits our ability to use our historical net operating loss and tax credit carryforwards may harm our future operating results by effectively increasing our future tax obligations. 15 Table of Conte nts Our financial condition and results of operations could be adversely affected if we do not effectively manage our current or future debt.
We must continually add new subscriptions both to replace cancelled subscriptions and to grow our business beyond our current subscription base.
We must continually add new subscriptions both to replace canceled subscriptions and to grow our business beyond our current subscription base.
Further, we have filed an effective shelf registration statement on Form S-3 under which we may offer from time to time in one or more offerings any combination of common and preferred stock, debt securities, warrants, purchase contracts and units of up to $750.0 million in the aggregate.
Further, we have filed two effective shelf registration statements on Form S-3 under each of which we may offer from time to time in one or more offerings any combination of common and preferred stock, debt securities, warrants, purchase contracts and units of up to $750.0 million in the aggregate.
We have determined that there have been defects with respect to certain historical corporate transactions relating to FaceBank Pre-Merger, including transactions that were not or may not have been properly approved by our board of directors, transactions that may have breached our organizational documents, or transactions that may not have been adequately documented.
We have determined that there have been defects with respect to certain historical corporate transactions relating to FaceBank Group, Inc., including transactions that were not or may not have been properly approved by our board of directors, transactions that may have breached our organizational documents, or transactions that may not have been adequately documented.
In addition to the risks that we face in the United States, our international operations involve risks that could adversely affect our business, including: ● differing legal and regulatory requirements, including country-specific data privacy and security laws and regulations, consumer protection laws and regulations, tax laws, trade laws, labor regulations, tariffs, export quotas, custom duties on cross-border movements of goods or data flows, extension of limits on TV advertising minutes to OTT advertising, local content requirements, data or data processing localization requirements, or other trade restrictions; ● slower adoption and acceptance of streaming services in other countries; ● the need to adapt our content and user interfaces for specific cultural and language differences, including delivering support and training documentation in languages other than English; ● our ability to deliver or provide access to popular streaming channels or content to users in certain international markets; ● different or unique competitive pressures as a result of, among other things, the presence of local consumer electronics companies and the greater availability of free content on over-the-air channels in certain countries, such as France; ● challenges inherent in efficiently staffing and managing an increased number of employees over large geographic distances, including the need to implement appropriate systems, policies, compensation and benefits, and compliance programs; ● political or social unrest and economic instability; ● compliance with laws such as the Foreign Corrupt Practices Act, UK Bribery Act and other anti-corruption laws, export controls and economic sanctions, and local laws prohibiting corrupt payments to government officials; ● compliance with various privacy, data transfer, data protection, accessibility, consumer protection and child protection laws in the European Union and other international markets that we operate in; ● difficulties in understanding and complying with local laws, regulations and customs in foreign jurisdictions, including local ownership requirements for streaming content providers and laws and regulations relating to privacy, data protection and information security, and the risks and costs of non-compliance with such laws, regulations and customs; ● regulatory requirements or government action against our service, whether in response to enforcement of actual or purported legal and regulatory requirements or otherwise, that results in disruption or non-availability of our service or particular content in the applicable jurisdiction; ● adverse tax consequences such as those related to changes in tax laws or tax rates or their interpretations, and the related application of judgment in determining our global provision for income taxes, deferred tax assets or liabilities or other tax liabilities given the ultimate tax determination is uncertain; ● differing legal and court systems, including limited or unfavorable intellectual property protection; ● fluctuations in currency exchange rates could impact our revenue and expenses of our international operations and expose us to foreign currency exchange rate risk; ● profit repatriation and other restrictions on the transfer of funds; ● differing payment processing systems; ● working capital constraints; and ● new and different sources of competition. 38 If we invest substantial time and resources to expand our international operations and are unable to do so successfully and in a timely manner, our business and financial condition may be harmed.
In addition to the risks that we face in the United States, our international operations involve risks that could adversely affect our business, including: • differing legal and regulatory requirements, including country-specific data privacy and security laws and regulations, consumer protection laws and regulations, tax laws, trade laws, labor regulations, tariffs, export quotas, custom duties on cross-border movements of goods or data flows, extension of limits on TV advertising minutes to OTT advertising, local content requirements, data or data processing localization requirements, or other trade restrictions; • slower adoption and acceptance of streaming services in other countries; • the need to adapt our content and user interfaces for specific cultural and language differences, including delivering support and training documentation in languages other than English; • our ability to deliver or provide access to popular streaming channels or content to users in certain international markets; • different or unique competitive pressures as a result of, among other things, the presence of local consumer electronics companies and the greater availability of free content on over-the-air channels in certain countries, such as France; • challenges inherent in efficiently staffing and managing an increased number of employees over large geographic distances, including the need to implement appropriate systems, policies, compensation and benefits, and compliance programs; • political or social unrest, including the ongoing war between Russia and Ukraine, and economic instability; • compliance with laws such as the Foreign Corrupt Practices Act, UK Bribery Act and other anti-corruption laws, export controls and economic sanctions, and local laws prohibiting corrupt payments to government officials; • compliance with various privacy, data transfer, data protection, accessibility, consumer protection and child protection laws in the European Union and other international markets that we operate in; • difficulties in understanding and complying with local laws, regulations and customs in foreign jurisdictions, including local ownership requirements for streaming content providers and laws and regulations relating to privacy, data protection and information security, and the risks and costs of non-compliance with such laws, regulations and customs; • regulatory requirements or government action against our service, whether in response to enforcement of actual or purported legal and regulatory requirements or otherwise, that results in disruption or non-availability of our service or particular content in the applicable jurisdiction; 36 Table of Conte nts • adverse tax consequences such as those related to changes in tax laws or tax rates or their interpretations, and the related application of judgment in determining our global provision for income taxes, deferred tax assets or liabilities or other tax liabilities given the ultimate tax determination is uncertain; • differing legal and court systems, including limited or unfavorable intellectual property protection; • fluctuations in currency exchange rates could impact our revenue and expenses of our international operations and expose us to foreign currency exchange rate risk; • profit repatriation and other restrictions on the transfer of funds; • differing payment processing systems; • working capital constraints; and • new and different sources of competition.
In the European Union (“EU”) and its member states, the EU General Data Protection Regulation 2016/679, or the GDPR, which has been in effect since May 25, 2018, imposes stringent obligations relating to data protection and security. Further, the departure of the United Kingdom (“UK”) from the EU has created a separate regime with similarly onerous obligations.
In the European Union (“EU”) and its member states, the GDPR, which has been in effect since May 25, 2018, imposes stringent obligations relating to data protection and security. Further, the departure of the United Kingdom (“UK”) from the EU has created a separate regime with similarly onerous obligations.
We may not be able to engage in any of these activities or engage in these activities on desirable terms, which could result in a default on our current or future debt agreements. Our operating results may fluctuate, which makes our results difficult to predict.
We may not be able to engage in any of these activities or engage in these activities on desirable terms, which could result in a default on our current or future debt agreements. 16 Table of Conte nts Our operating results may fluctuate, which makes our results difficult to predict.
We will need to improve our operational and financial systems to support our expected growth, increasingly complex business arrangements, and rules governing revenue and expense recognition, and any inability to do so could adversely affect our billing services and financial reporting.
We will need to improve our operational and financial systems to support our expected long term growth, along with increasingly complex business arrangements, and rules governing revenue and expense recognition, and any inability to do so could adversely affect our billing services and financial reporting.
We may not be able to compete effectively or adapt to any such changes or trends, which would harm our ability to grow our advertising revenue and harm our business. If content providers refuse to license streaming content or other rights upon terms acceptable to us, our business could be adversely affected.
We may not be able to compete effectively or adapt to any such changes or trends, which would harm our ability to grow our advertising revenue and harm our business. 20 Table of Conte nts If content providers refuse to license streaming content or other rights upon terms acceptable to us, our business could be adversely affected.
A number of jurisdictions’ gaming laws may require any of our shareholders to file an application, be investigated, and qualify or have his, her, or its suitability determined by gaming authorities. Gaming authorities have very broad discretion when ruling on whether an applicant should be deemed suitable or not.
A number of jurisdictions’ gaming laws have, and may in the future, require certain of our shareholders to file an application, be investigated, and qualify or have his, her, or its suitability determined by gaming authorities. Gaming authorities have very broad discretion when ruling on whether an applicant should be deemed suitable or not.
Moreover, our ability to renew these contracts on favorable terms may be affected by consolidation in the market for content distribution, the entrance of new participants in the market for distribution of content on digital platforms and the impacts of COVID-19.
Moreover, our ability to renew these contracts on favorable terms may be affected by consolidation in the market for content distribution, the entrance of new participants in the market for distribution of content on digital platforms and other factors such as the impacts of COVID-19.
Companies such as AT&T, Comcast, Cablevision, Cox and Altice, along with vMVPDs, such as YouTube TV, Hulu Live and Sling TV offer TV streaming products that compete with our platform.
Companies such as AT&T, Comcast, Cox and Altice, along with MVPDs, such as YouTube TV, Hulu Live and Sling TV, offer TV streaming products that compete with our platform.
To remain competitive, we need to continuously invest in product development and marketing. We may not have sufficient resources to continue to make the investments needed to maintain our competitive position.
To remain competitive, we need to continuously invest in product development and marketing. We may not have sufficient resources to make additional investments needed to maintain our competitive position.
Our agreements with distribution partners contain parity obligations which limit our ability to pursue unique partnerships.
Our agreements with certain distribution partners may contain parity obligations which limit our ability to pursue unique partnerships.
Increased competition could reduce our market share, revenue and operating margins, increase our operating costs, harm our competitive position and otherwise harm our business. 24 If the advertisements and audience development campaigns and other promotional advertising on our platform are not relevant or not engaging to our subscribers, our growth in subscribers, advertisers and hours streamed may be adversely impacted.
Increased competition could reduce our market share, revenue and operating margins, increase our operating costs, harm our competitive position and otherwise harm our business. 26 Table of Conte nts If the advertisements and audience development campaigns and other promotional advertising on our platform are not relevant or not engaging to our subscribers, our growth in subscribers, advertisers and hours streamed may be adversely impacted.
We continue to pursue and may in the future engage in strategic acquisitions and investments, which involve a number of risks, and if we are unable to address and resolve these risks successfully, such acquisitions and investments could harm our business.
We have pursued and may in the future engage in strategic acquisitions and investments, which involve a number of risks, and if we are unable to address and resolve these risks successfully, such acquisitions and investments could harm our business.
To manage the expected growth of our operations and increasing complexity, we will need to improve our operational and financial systems, procedures and controls and continue to increase systems automation to reduce reliance on manual operations. Any inability to do so will negatively affect our billing services and financial reporting.
To manage the expected growth of our operations over the long term and increasing complexity, we will need to improve our operational and financial systems, procedures and controls and further increase systems automation to reduce reliance on manual operations. Any inability to do so will negatively affect our billing services and financial reporting.
Each jurisdiction typically requires us to make detailed and extensive disclosures as to their beneficial ownership, their source of funds, the suitability and integrity of certain persons associated with the applicant, the applicant’s management competence, structure, and business plans, the applicant’s proposed geographical territories of operation, and the applicant’s ability to operate a gaming business in a socially responsible manner in compliance with regulation.
Each jurisdiction typically required us to make detailed and extensive disclosures as to our beneficial ownership, our source of funds, the suitability and integrity of certain persons associated with us, our management competence, structure, and business plans, our proposed geographical territories of operation, and our ability to operate a gaming business in a socially responsible manner in compliance with regulation.
It is not clear what the potential effects any such alterations or modifications may have on our business, including the effects on our subscribers, or on our financial results. 36 We could be subject to claims or have liability based on defects with respect to certain historical corporate transactions that were not properly authorized or documented.
It is not clear what the potential effects any such alterations or modifications may have on our business, including the effects on our subscribers, or on our financial results. 34 Table of Conte nts We could be subject to claims or have liability based on defects with respect to certain historical corporate transactions that were not properly authorized or documented.
We might not be able to utilize a significant portion of our net operating loss carryforwards. As of December 31, 2021, we had federal net operating loss carryforwards of approximately $811.3 million, a portion of which will expire at various dates if not used prior to such dates.
We might not be able to utilize a significant portion of our net operating loss carryforwards. As of December 31, 2022, we had federal net operating loss carryforwards of approximately $1,207.3 million, a portion of which will expire at various dates if not used prior to such dates.
With the increase in remote work during the current COVID-19 pandemic, we and the third parties we use in our operations face increased risks to the security of infrastructure and data, and we cannot guarantee that our or their security measures will prevent security breaches.
With the increase in remote work during the COVID-19 pandemic and continued hybrid working environment, we and the third parties we use in our operations face increased risks to the security of infrastructure and data, and we cannot guarantee that our or their security measures will prevent security breaches.
Additionally, our use of subscriber data to deliver relevant advertising on our platform places us and our content publishers at risk for claims under a number of other unsettled laws, including the Video Privacy Protection Act, or VPPA.
Additionally, our use of subscriber data to deliver relevant advertising on our platform places us and our content publishers at risk for claims under a number of other laws, including but not limited to the Video Privacy Protection Act ("VPPA").
Risks Related to Our Financial Position and Capital Needs We have incurred operating losses in the past, expect to incur operating losses in the future and may never achieve or maintain profitability. We have incurred losses since inception. Our net loss for the year ended December 31, 2021 was $383.0 million.
Risks Related to Our Financial Position and Capital Needs We have incurred operating losses in the past, expect to incur operating losses in the future and may never achieve or maintain profitability. We have incurred losses since inception. Our net loss for the year ended December 31, 2022 was $561.9 million.
Third parties may also knowingly or unknowingly infringe our intellectual property rights, and litigation or proceedings before governmental authorities and administrative bodies may be necessary in the future to enforce our intellectual property rights, to protect our patent rights, trademarks, trade secrets, and domain names and to determine the validity and scope of the proprietary rights of others.
Third parties may also knowingly or unknowingly infringe our intellectual property rights, and litigation or proceedings before governmental authorities and administrative bodies may be necessary in the future to protect and enforce our patents, trademarks, trade secrets and other intellectual property rights, to protect our patent rights and to challenge the validity or scope of the proprietary rights of others.
A decline in the price of shares of our common stock might impede our ability to raise capital through the issuance of additional shares of our common stock or other equity securities. We also filed a Form S-8 registration statement to register shares reserved for future issuance under our equity compensation plans.
A decline in the price of shares of our common stock might impede our ability to raise capital through the issuance of additional shares of our common stock or other equity securities. 47 Table of Conte nts We also filed Form S-8 registration statements to register shares reserved for future issuance under our equity compensation plans.
In addition, many TV brands, such as LG, Samsung Electronics Co., Ltd. and VIZIO, Inc., offer their own TV streaming solutions within their TVs. Other devices, such as Microsoft’s Xbox and Sony’s PlayStation game consoles and many DVD and Blu-ray players, also incorporate TV streaming functionality.
In addition, many TV manufacturers, such as LG Electronics Inc., Samsung Electronics Co., Ltd. and VIZIO, Inc., offer their own TV streaming solutions pre-installed on their TVs. Other devices, such as Microsoft’s Xbox and Sony’s PlayStation game consoles and many DVD and Blu-ray players, also incorporate TV streaming functionality.
In addition to government regulation, self-regulatory standards and other industry standards may legally or contractually apply to us, be argued to apply to us, or we may elect to comply with such standards or facilitate compliance by content publishers, advertisers, or others with such standards. 40 For example, the California Consumer Privacy Act (“CCPA”), became operative on January 1, 2020.
In addition to government regulation, self-regulatory standards and other industry standards may legally or contractually apply to us, be argued to apply to us, or we may elect to comply with such standards or facilitate compliance by content publishers, advertisers, or others with such standards. For example, the CCPA became operative on January 1, 2020.
We may be subject to fines or other penalties imposed by the Internal Revenue Service and other tax authorities. Certain of our subsidiaries are currently delinquent in filing annual tax returns with the Internal Revenue Service and several states. We are in the process of working with our subsidiaries to remedy this issue by filing these delinquent tax returns.
We may be subject to fines or other penalties imposed by the Internal Revenue Service and other tax authorities. Certain of our subsidiaries are currently delinquent in filing annual tax returns with the Internal Revenue Service and several states.

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Item 2. Properties

Properties — owned and leased real estate

1 edited+1 added−0 removed1 unchanged
Biggest changeWe believe that our facilities are suitable to meet our current needs, and that suitable additional or substitute space will be available as needed to accommodate any further physical expansion of operations and for any additional offices.
Biggest changeWe believe that our facilities are suitable to meet our current needs, and that suitable additional or substitute space will be available as needed to accommodate any further physical expansion of operations and for any additional offices. Item 3. Legal Proceedings.
Added
See discussion under the heading “Legal Proceedings” in Note 16 to the consolidated financial statements included in Part II, Item 8 of this Annual Report. Item 4. Mine Safety Disclosures Not applicable. 49 Table of Conte nts PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

2 edited+3 added−4 removed2 unchanged
Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our common stock trades on the New York Stock Exchange under the symbol, “FUBO.” Holders of Record As of January 31, 2022, there were 294 holders of record of our common stock.
Biggest changeItem 5. Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities. Market Information Our common stock trades on the New York Stock Exchange under the symbol, “FUBO.” Holders of Record As of January 31, 2023, there were 268 holders of record of our common stock.
The actual number of stockholders is greater than this number of record holders and includes stockholders who are beneficial owners but whose shares are held in street name by brokers and other nominees. Dividend Policy We have not declared or paid any cash dividends on our common stock.
The actual number of shareholders is greater than this number of record holders and includes shareholders who are beneficial owners but whose shares are held in street name by brokers and other nominees. Dividend Policy We have not declared or paid any cash dividends on our common stock.
Removed
Recent Sales of Unregistered Securities Set forth below is information regarding all unregistered securities sold by the Company during the year ended December 31, 2021: ● In February 2021, the Company issued an aggregate of 623,068 shares of its common stock in connection with its acquisition of Vigtory, Inc.
Added
Stock Performance Graph The information contained in this stock performance graph section shall not be deemed to be “soliciting material” or “filed” or incorporated by reference in future filings with the SEC, or subject to the liabilities of Section 18 of the Exchange Act, except to the extent that we specifically incorporate it by reference into a document filed under the Securities Act or the Exchange Act.
Removed
These shares were subsequently registered for resale pursuant to a registration statement on Form S-3. ● In December 2021, the Company issued an aggregate of 464,700 shares of its common in connection with its acquisition of Edisn.
Added
The following graph compares the total shareholder return from October 8, 2020, the date on which our common shares commenced trading on the New York Stock Exchange, through December 31, 2022 of (i) our common stock, (ii) the Russell 3000 Index (“Russell 3000”) and (iii) the S&P Media and Entertainment Index, assuming an initial investment of $100 on October 8, 2020 including reinvestment of dividends where applicable.
Removed
The shares of the Company’s common stock were be issued pursuant to the exemptions from registration found in Section 4(2) of the Securities Act and Regulation D and Regulation S promulgated thereunder .
Added
The results presented below are not necessarily indicative of future performance. 50 Table of Conte nts
Removed
Purchases of Equity Securities by the Issuer and Affiliated Purchasers In December 2021, the Company repurchased the following shares of its common stock held by a former employee: Date Number of shares purchased Price per share December 13, 2021 166,599 0.000005

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

62 edited+71 added−44 removed44 unchanged
Biggest changeBecause of this, certain of our results of operations for the year ended December 31, 2021 are not comparable to the results of operations for the year ended December 31, 2020. 52 For the Years Ended December 31, 2021 2020 Revenues Subscriptions $ 564,441 $ 184,328 Advertising 73,749 24,904 Software licenses, net - 7,295 Other 160 1,219 Total revenues $ 638,350 $ 217,746 Operating expenses Subscriber related expenses $ 593,241 $ 204,240 Broadcasting and transmission 55,563 29,542 Sales and marketing 142,387 63,141 Technology and development 60,513 30,189 General and administrative 108,185 77,635 Depreciation and amortization 37,881 43,972 Impairment of intangible assets and goodwill - 248,926 Total operating expenses 997,770 697,645 Operating loss $ (359,420 ) $ (479,899 ) Other income (expense) Interest expense and financing costs $ (13,485 ) $ (18,637 ) Amortization of debt discount (14,928 ) - Gain on sale of assets - 7,631 Loss on extinguishment of debt (380 ) (24,521 ) Loss on deconsolidation of Nexway - (11,919 ) Change in fair value of warrant liabilities 2,659 (83,338 ) Change in fair value of shares settled liability - (1,665 ) Change in fair value of derivative liability - (426 ) Change in fair value of profit share liability - 1,971 Unrealized gain on equity method investment - 2,614 Foreign currency exchange loss - (1,010 ) Other income (90 ) 147 Total other expense $ (26,224 ) $ (129,153 ) Loss before income taxes $ (385,644 ) $ (609,052 ) Income tax benefit 2,681 9,660 Net loss $ (382,963 ) $ (599,392 ) Revenue, net During the year ended December 31, 2021, we recognized revenues of $638.4 million, primarily consisting of $564.4 million of subscription revenue, $73.7 million of advertising revenue and $0.2 million in other revenue.
Biggest changeFor the Years Ended 2021 2020 Revenues Subscription $ 564,441 $ 184,328 Advertising 73,749 24,904 Software licenses, net — 7,295 Other 180 1,219 Total revenues 638,370 217,746 Operating expenses Subscriber related expenses 593,241 204,240 Broadcasting and transmission 55,563 29,542 Sales and marketing 135,720 63,141 Technology and development 55,418 30,189 General and administrative 89,039 77,635 Depreciation and amortization 37,666 43,972 Impairment of goodwill and intangible assets — 248,926 Total operating expenses 966,647 697,645 Operating loss (328,277) (479,899) Other income (expense) Interest expense and financing costs (13,451) (18,637) Amortization of debt discount (14,928) — Gain on sale of assets — 7,631 Loss on extinguishment of debt (380) (24,521) Loss on deconsolidation of Nexway — (11,919) Change in fair value of warrant liabilities 2,659 (83,338) Change in fair value of shares settled liability — (1,665) Change in fair value of derivative liability — (426) Change in fair value of profit share liability — 1,971 Unrealized gain on equity method investment — 2,614 Foreign currency exchange loss — (1,010) Other income (expense) (90) 147 Total other expense (26,190) (129,153) Loss from continuing operations before income taxes (354,467) (609,052) Income tax benefit 2,681 9,660 Net loss from continuing operations (351,786) (599,392) Discontinued operations Loss from discontinued operations before income taxes (31,177) — Net loss from discontinued operations (31,177) — Net loss (382,963) (599,392) 60 Table of Conte nts Revenue, net During the year ended December 31, 2021, we recognized revenues of $638.4 million, primarily consisting of $564.4 million of subscription revenue, $73.7 million of advertising revenue and $0.2 million in other revenue.
The non-cash movements included $248.9 impairment of Facebank Pre-Merger intangible assets and goodwill, $83.3 million change in fair value of warrants, $50.7 million of stock-based compensation, $44.0 million of depreciation and amortization expenses primarily related to intangible assets, $24.5 million loss on extinguishment of debt, $12.3 million of amortization of debt discounts, $8.6 million loss on deconsolidation of Nexway (net of cash), $1.7 million of change in fair value of shares settled liability and $1.0 million of loss on foreign currency exchange, partially offset by $9.7 million of deferred income tax benefit, $7.6 million gain on the sale of assets, $2.6 million of unrealized gain on investments and $2.0 million change in fair value of profit share liability.
The non-cash movements included $248.9 million impairment of Facebank Pre-Merger intangible assets and goodwill, $83.3 million change in fair value of warrants, $50.7 million of stock-based compensation, $44.0 million of depreciation and amortization expenses primarily related to intangible assets, $24.5 million loss on extinguishment of debt, $12.3 million of amortization of debt discounts, $8.6 million loss on deconsolidation of Nexway (net of cash), $1.7 million of change in fair value of shares settled liability and $1.0 million of loss on foreign currency exchange, partially offset by $9.7 million of deferred income tax benefit, $7.6 million gain on the sale of assets, $2.6 million of unrealized gain on investments and $2.0 million change in fair value of profit share liability.
Facebank AG and Nexway were sold in July 2020. 54 Income tax benefit During the year ended December 31, 2021, we recognized an income tax benefit of $2.7 million compared to $9.7 million during the year ended December 31, 2020.
Facebank AG and Nexway were sold in July 2020. Income tax benefit During the year ended December 31, 2021, we recognized an income tax benefit of $2.7 million compared to $9.7 million during the year ended December 31, 2020.
The decrease of $102.9 million is primarily related to an $86.0 million reduction in the change in fair value of warrant liabilities, a $24.1 million decrease in loss on extinguishment of debt, an $11.9 million reduction in loss on deconsolidation of Nexway during 2020 and a $5.2 million reduction of interest expense, partially offset by an increase of $14.9 million in amortization of debt discount, $7.6 million gain on the sale of the Facebank AG and Nexway assets during 2020 and $2.6 million unrealized gain on our equity method investment in Nexway in 2020.
The decrease of $103.0 million is primarily related to an $86.0 million reduction in the change in fair value of warrant liabilities, a $24.1 million decrease in loss on extinguishment of debt, an $11.9 million reduction in loss on deconsolidation of Nexway during 2020 and a $5.2 million reduction of interest expense, partially offset by an increase of $14.9 million in amortization of debt discount, $7.6 million gain on the sale of the Facebank AG and Nexway assets during 2020 and $2.6 million unrealized gain on our equity method investment in Nexway in 2020.
We ultimately concluded that Facebank Pre-Merger was the accounting acquirer in the Merger because (i) FaceBank Pre-Merger’s stockholders owned approximately 57% of the voting common shares of the combined company immediately following the closing of the Merger (54% assuming the exercise of all vested stock options as of the closing of the transaction) and (ii) directors appointed by FaceBank Pre-Merger would hold a majority of board seats in the combined company.
We ultimately concluded that Facebank Pre-Merger was the accounting acquirer in the Merger because (i) FaceBank Pre-Merger’s shareholders owned approximately 57% of the voting common shares of the combined company immediately following the closing of the Merger (54% assuming the exercise of all vested stock options as of the closing of the transaction) and (ii) directors appointed by FaceBank Pre-Merger would hold a majority of board seats in the combined company.
Advertising Advertising revenue consists primarily of fees charged to advertisers who want to display ads (“impressions”) within the streamed content. 51 Software licenses, net Software license revenue consists of revenue generated from the sale of software licenses at one of our former subsidiaries, Nexway eCommerce Solutions.
Advertising Advertising revenue consists of fees charged to advertisers who want to display ads (“impressions”) within the streamed content. Software licenses, net Software license revenue consists of revenue generated from the sale of software licenses at one of our former subsidiaries, Nexway eCommerce Solutions.
The impairment charge was primarily related to the departure of the former executive of the Facebank business and our shift in focus to the fuboTV business. We performed our annual impairment test in the fourth quarter of 2021 and concluded that no additional impairment charges were necessary.
The impairment charge was primarily related to the departure of the former executive of the Facebank business and our shift in focus to the Fubo business. We performed our annual impairment test in the fourth quarter of 2021 and concluded that no additional impairment charges were necessary.
The increase of $26.1 million was primarily due to a full year of expenses in 2021 of fuboTV compared to nine months in the prior year period and higher number of linear feeds due to additional channel launches.
The increase of $26.1 million was primarily due to a full year of expenses in 2021 of Fubo compared to nine months in the prior year period and higher number of linear feeds due to additional channel launches.
We currently have an effective shelf registration statement on Form S-3 (No. 333-258428) initially filed with the SEC on August 4, 2021, as amended (the “Form S-3”) under which we may offer from time to time in one or more offerings any combination of common and preferred stock, debt securities, warrants, purchase contracts and units of up to $750.0 million in the aggregate.
We currently have an effective shelf registration statement on Form S-3 (No. 333-258428) initially filed with the SEC on August 4, 2021, as amended (the “2021 Form S-3”) pursuant to which we may offer, from time to time, in one or more offerings any combination of common stock, preferred stock, debt securities, warrants, purchase contracts and units of up to $750.0 million in the aggregate.
Issuing additional shares of our capital stock, other equity securities, or additional securities convertible into equity may dilute the economic and voting rights of our existing stockholders, reduce the market price of our common stock, or both.
Issuing additional shares of our capital stock, other equity securities, or additional securities convertible into equity may dilute the economic and voting rights of our existing shareholders, reduce the market price of our common stock, or both.
Depreciation and amortization During the year ended December 31, 2021, we recognized depreciation and amortization expenses of $37.9 million compared to $44.0 million during the year ended December 31, 2020.
Depreciation and amortization During the year ended December 31, 2021, we recognized depreciation and amortization expenses of $37.7 million compared to $44.0 million during the year ended December 31, 2020.
For stock-based awards that have a performance component, stock-based compensation is measured based on the fair value on the grant date and is recognized over the requisite service period as achievement of the performance objective becomes probable We estimate the fair value of our stock option awards on the grant date using the Black-Scholes option-pricing model.
For stock-based awards that have a performance component, stock-based compensation is measured based on the fair value on the grant date and is recognized over the requisite service period as achievement of the performance objective becomes probable 69 Table of Conte nts We estimate the fair value of our stock option awards on the grant date using the Black-Scholes option-pricing model.
You should review the sections titled “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” for a discussion of forward-looking statements and important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.
You should review the sections titled “Forward-Looking Statements” and “Risk Factors” for a discussion of forward-looking statements and important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.
Sales and marketing During the year ended December 31, 2021, we recognized sales and marketing expenses of $142.4 million compared to $63.1 million during the year ended December 31, 2020.
Sales and marketing During the year ended December 31, 2021, we recognized sales and marketing expenses of $135.7 million compared to $63.1 million during the year ended December 31, 2020.
Technology and development During the year ended December 31, 2021, we recognized technology and development expenses of $60.5 million compared to $30.2 million during the year ended December 31, 2020.
Technology and development During the year ended December 31, 2021, we recognized technology and development expenses of $55.4 million compared to $30.2 million during the year ended December 31, 2020.
See Note 10 in the accompanying unaudited consolidated financial statements for further discussion regarding our outstanding indebtedness.
See Note 11 in the accompanying consolidated financial statements for further discussion regarding our outstanding indebtedness.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. You should read the following discussion and analysis of our financial condition and results of operations together with our consolidated financial statements and the related notes and other financial information included elsewhere in this Annual Report.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. The following discussion and analysis by our management of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and the related notes and other financial information included elsewhere in this Annual Report.
The increase of $79.3 million was primarily due to a full year of expenses in 2021 of fuboTV compared to nine months in the prior year period and increased marketing expenses incurred to acquire new customers to our streaming platform.
The increase of $72.6 million was primarily due to a full year of expenses in 2021 of Fubo compared to nine months in the prior year period and increased marketing expenses incurred to acquire new customers to our streaming platform.
General and Administrative During the year ended December 31, 2021, general and administrative expenses totaled $108.2 million compared to $77.6 million for the year ended December 31, 2020.
General and Administrative During the year ended December 31, 2021, general and administrative expenses totaled $89.0 million compared to $77.6 million for the year ended December 31, 2020.
As a result of the deconsolidation of Nexway AG, which was effective as of March 31, 2020, the Company no longer generates revenue from software licenses. Other Other revenue consists of a contract to sub-license rights to broadcast certain international sporting events to a third party.
As a result of the deconsolidation of Nexway AG, which was effective as of March 31, 2020, the Company no longer generates revenue from software licenses. Other Other revenue consists of a contract to sub-license rights to broadcast certain international sporting events to a third party and commissions earned on sales through a channel distribution platform.
Changes in operating assets and liabilities resulted in cash inflows of approximately $76.3 million, primarily due to a net increase in accounts payable, accrued expenses and other current and long-term liabilities of $75.6 million due to timing of payments and a net increase in deferred revenue of $26.1 million, partially offset by increases in accounts receivable of $15.1 million, prepaid expenses and other assets of $9.6 million and cash reserved for users of $0.6 million. 59 For the year ended December 31, 2020, net cash used in operating activities was $149.0 million, which consisted of our net loss of $599.4 million, adjusted for non-cash movements of $456.2 million.
Changes in operating assets and liabilities resulted in cash inflows of approximately $77.6 million, primarily due to a net increase in accounts payable, accrued expenses and other current and long-term liabilities of $73.4 million due to timing of payments and a net increase in deferred revenue of $26.1 million, partially offset by increases in accounts receivable of $15.0 million and prepaid expenses, prepaid sports rights and other assets of $6.8 million. 66 Table of Conte nts For the year ended December 31, 2020, net cash used in operating activities was $149.0 million, which consisted of our net loss of $599.4 million, adjusted for non-cash movements of $456.2 million.
Other Income (Expense) During the year ended December 31, 2020, we recognized $129.2 million of other expense (net), compared to $4.5 million during the year ended December 31, 2019.
Other Income (Expense) During the year ended December 31, 2021, we recognized $26.2 million of other expense (net), compared to $129.2 million of other expense (net) during the year ended December 31, 2020.
We concluded that the fair value of the intangible assets was less than its carrying value and we recognized impairment charges of $100.3 million related to the legacy Facebank intangible assets. There were no triggering events during 2021.
We concluded that the fair value of the intangible assets was less than its carrying value and we recognized impairment charges of $100.3 million related to the legacy Facebank intangible assets.
The non-cash movements consist primarily of $38.0 million of depreciation and amortization expenses, $63.8 million of stock-based compensation, $14.9 million of amortization of debt discounts and $1.4 million amortization of right of use assets, partially offset by $2.7 million of change in fair value of warrant liability.
The non-cash movements consist primarily of $37.7 million of depreciation and amortization expenses, $53.2 million of stock-based compensation, $14.9 million of amortization of debt discounts and $1.0 million amortization of right of use assets, partially offset by $2.7 million of change in fair value of warrant liability and $2.7 million of deferred income tax benefit.
General and Administrative General and administrative expenses consist primarily of payroll and related costs, benefits, rent and utilities, stock-based compensation, corporate insurance, office expenses, professional fees, as well as travel, meals, and entertainment costs. Depreciation and amortization Depreciation and amortization expense includes depreciation of fixed assets and amortization of finite-lived intangible assets.
General and Administrative General and administrative expenses consist primarily of payroll and related costs, benefits, rent and utilities, stock-based compensation, corporate insurance, office expenses, professional fees, as well as travel, meals, and entertainment costs.
The decrease of $6.1 million is primarily related to a reduction of $16.4 million of amortization expense related to intangible assets of FaceBank Pre-Merger that were subject to impairment charges in the third and fourth quarters of 2020, offset in part by a full year of expenses in 2021 compared to nine months in the prior year period.
The decrease of $6.3 million is primarily related to a reduction of $16.4 million of amortization expense related to intangible assets of FaceBank Pre-Merger that were subject to impairment charges in the third and fourth quarters of 2020, offset in part by a full year of expenses in 2021 compared to nine months in the prior year period. 61 Table of Conte nts Impairment of intangible assets and goodwill During the year ended December 31, 2020, we recognized an impairment of Facebank Pre-Merger intangible assets and goodwill of $248.9 million.
Other income (expense) Other income (expense) primarily consists of issuance gains/losses and the change in fair value of financial instruments, interest expense and financing costs on our outstanding borrowings and the loss recorded on the deconsolidation of a subsidiary.
Depreciation and amortization Depreciation and amortization expense includes depreciation of fixed assets and amortization of finite-lived intangible assets. 55 Table of Conte nts Other income (expense) Other income (expense) primarily consists of issuance gains/losses and the change in fair value of financial instruments, interest expense and financing costs on our outstanding borrowings and the loss recorded on the deconsolidation of a subsidiary.
The increase of $389.0 million was primarily due to a full year of expenses in 2021 of fuboTV compared to nine months in the prior year period and an increase in affiliate distribution rights and other distribution costs resulting from an increase in subscribers.
The increase of $389.0 million was primarily due to a full year of expenses in 2021 of Fubo compared to nine months in the prior year period comprised of an increase of $371.4 million in affiliate distribution rights and $12.5 million in other distribution costs primarily driven by an increase in the number of subscribers.
The increase of $30.6 million was primarily due to a full year of expenses in 2021 of fuboTV compared to nine months in the prior year period, a $5.2 million increase in sales tax reserves, a $1.3 million increase in stock-based compensation, $9.0 million related to the launch of our online wagering operations, a $6.2 million increase in professional fees and a $3.4 million increase related to business insurance, and $5.0 million increase in salaries due to an increase in employee headcount.
The increase of $11.4 million was primarily due to a full year of expenses in 2021 of Fubo compared to nine months in the prior year period including a $5.2 million increase in sales tax reserves, $1.3 million increase in stock-based compensation and $5.0 million increase in salaries due to an increase in employee headcount.
The increase of $30.3 million was primarily due to a full year of expenses in 2021 of fuboTV compared to nine months in the prior year period, an increase of $16.9 million in salaries due to an increase in employee headcount, $8.6 million in stock-based compensation and $4.8 million in costs related to the launch of our online wagering operations.
The increase of $25.2 million was primarily due to a full year of expenses in 2021 of Fubo compared to nine months in the prior year period including an increase of $16.9 million in salaries due to an increase in employee headcount and $8.6 million in stock-based compensation.
The increase of $420.6 million was primarily due to a full year of revenue in 2021 of fuboTV compared to nine months in the prior year period, higher subscription revenue due to increases in our subscriber base and subscription package prices and an increase in advertising revenue resulting from an increase in the number of impressions sold. 53 Subscriber related expenses During the year ended December 31, 2021, we recognized subscriber related expenses of $593.2 million compared to $204.2 million during the year ended December 31, 2020.
The increase of $420.6 million was primarily due to a full year of revenue in 2021 of Fubo compared to nine months in the prior year period, $301.6 million of higher subscription revenue due to increases in our subscriber base, $78.5 million of higher subscription revenue due to increases in subscription package prices and a $48.8 million increase in advertising revenue resulting from an increase in the number of impressions sold.
Financing Activities For the year ended December 31, 2021, net cash provided by financing activities was $512.0 million.
These proceeds were offset by repayments of $1.7 million of outstanding debt. For the year ended December 31, 2021, net cash provided by financing activities was $512.0 million.
Overview Our business motto is “come for the sports, stay for the entertainment.” First, we leverage sporting events to acquire subscribers at lower acquisition costs, given the built-in demand for sports.
Fubo allows customers to access content through streaming devices and on SmartTVs, mobile phones, tablets, and computers. Our business motto is “come for the sports, stay for the entertainment.” First, we leverage sporting events to acquire subscribers at lower acquisition costs, given the built-in demand for sports.
Depreciation and amortization During the year ended December 31, 2020, we recognized depreciation and amortization expenses of $44.0 million compared to $20.8 million during the year ended December 31, 2019.
Depreciation and amortization During the year ended December 31, 2022, we recognized depreciation and amortization expenses of $36.7 million compared to $37.7 million during the year ended December 31, 2021.
Impairment of intangible assets and goodwill During the year ended December 31, 2020, we recognized an impairment of Facebank Pre-Merger intangible assets and goodwill of $248.9 million. Other Income (Expense) During the year ended December 31, 2021, we recognized $26.2 million of other expense (net), compared to $129.2 million of other expense (net) during the year ended December 31, 2020.
Other Income (Expense) During the year ended December 31, 2022, we recognized $14.9 million of other expense (net) compared to $26.2 million of other expense (net) during the year ended December 31, 2021.
Paid Subscribers We believe the number of paid subscribers is a relevant measure to gauge the size of our user base. Paid subscribers are total subscribers that have completed registration with fuboTV, have activated a payment method (only reflects one paying user per plan), from which fuboTV has collected payment in the month ending the relevant period.
Paid subscribers are total subscribers that have completed registration with Fubo, have activated a payment method (only reflects one paying user per plan), from which Fubo has collected payment in the month ending the relevant period. Users who are on a free (trial) period are not included in this metric.
The following assumptions were used in determining the fair value of stock options granted during the years ended December 31, 2021 and 2020 in the Monte Carlo simulation model: For the years ended December 31, 2021 2020 Dividend yield - - Expected volatility 71.5 % 76.0%-88.1 % Risk free rate 1.3 % 0.24%-0.30 % Derived service period 2.0 years 1.6- 1.9 years We account for forfeitures as they occur. 61 Recently Issued Accounting Pronouncements See Note 3 to our consolidated financial statements in Part II, Item 8 of this Annual Report for a discussion of recent accounting policies.
We will recognize stock-based compensation expense over the requisite service period, regardless of whether the stock price goals are achieved. 70 Table of Conte nts The following assumptions were used in determining the fair value of stock options granted during the years ended December 31, 2021 and 2020 in the Monte Carlo simulation model: For the years ended December 31, 2021 2020 Dividend yield — — Expected volatility 71.5 % 76.0%-88.1% Risk free rate 1.3 % 0.24%-0.30% Derived service period 2.0 years 1.6- 1.9 years We account for forfeitures as they occur.
Our future capital requirements and the adequacy of our available funds will depend on many factors, including our ability to successfully attract and retain subscribers, develop new technologies that can compete in a rapidly changing market with many competitors and the need to enter into collaborations with other companies or acquire other companies or technologies to enhance or complement our product and service offerings.
If we are unable to raise additional capital due to unfavorable market conditions, including rising interest rates, or otherwise, or generate cash flows necessary to expand our operations and invest in continued innovation, we may not be able to compete successfully, which would harm our business, operations, and financial condition. 65 Table of Conte nts Our future capital requirements and the adequacy of our available funds will depend on many factors, including our ability to successfully attract and retain subscribers, develop new technologies that can compete in a rapidly changing market with many competitors and the need to enter into collaborations with other companies or acquire other companies or technologies to enhance or complement our product and service offerings.
General and Administrative During the year ended December 31, 2020, general and administrative expenses totaled $77.6 million, compared to $13.3 million for the year ended December 31, 2019.
General and Administrative During the year ended December 31, 2022, general and administrative expenses totaled $81.2 million compared to $89.0 million for the year ended December 31, 2021.
Results of Operations for the years ended December 31, 2021 and 2020 (in thousands): On August 15, 2019 and September 16, 2019, the Company acquired Facebank AG and Nexway, respectively and on April 1, 2020 the Company acquired fuboTV Pre-Merger.
The change of $105.7 million is primarily due to an increase in the operating expenses of the wagering business and a charge for the impairment of goodwill, intangible assets and other assets. 59 Table of Conte nts Results of Operations for the Years Ended December 31, 2021 and 2020 (in thousands): On August 15, 2019 and September 16, 2019, the Company acquired Facebank AG and Nexway, respectively, and on April 1, 2020, the Company acquired fuboTV Pre-Merger.
The decrease of $7.0 million in the income tax benefit is primarily due to our inability to fully recognize the future tax benefits on current year losses. Results of Operations for the years ended December 31, 2020 and 2019 (in thousands): On August 15, 2019, the Company acquired 100% of the capital stock of Facebank AG.
The decrease of $7.0 million in the income tax benefit is primarily due to our inability to fully recognize the future tax benefits on current year losses.
Cash Flows (in thousands) Year Ended December 31, 2021 2020 Net cash (used in) operating activities $ (192,601 ) $ (149,018 ) Net cash (used in) investing activities (76,172 ) (1,457 ) Net cash provided by financing activities 511,958 279,072 Net increase in cash and cash equivalents $ 243,185 $ 128,597 Operating Activities For the year ended December 31, 2021, net cash used in operating activities was $191.6 million, which consisted of our net loss of $383.0 million, adjusted for non-cash movements of $114.0 million.
Cash Flows (in thousands) Year Ended December 31, 2022 2021 2020 Continuing operations: Net cash used in operating activities (289,786) (171,896) (149,018) Net cash used in investing activities (5,987) (30,377) (1,457) Net cash provided by financing activities 296,270 511,958 279,072 Discontinued operations Net cash used in operating activities (26,915) (24,031) — Net cash used in investing activities (6,436) (45,795) — Net increase in cash, cash equivalents and restricted cash (32,854) 239,859 128,597 Continuing Operations Operating Activities For the year ended December 31, 2022, net cash used in operating activities was $289.8 million, which consisted of our net loss of $425.0, adjusted for non-cash movements of $95.9 million.
Critical Accounting Policies Our discussion and analysis of financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America.
For the year ended December 31, 2021, net cash used in operating and investing activities was $24.0 million and $45.8 million, respectively, to launch Fubo Sportsbook. 67 Table of Conte nts Critical Accounting Policies and Estimates Our discussion and analysis of financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America.
As of December 31, 2021, we sold 5,338,607 shares of our common stock in at-the-market offerings pursuant to our shelf registration statement, resulting in net proceeds of approximately $140.6 million, after deducting agent commissions and issuance costs.
During the year ended December 31, 2022, we sold 50,620,577 shares of our common stock in at-the-market offerings pursuant to the 2021 Form S-3 and ATM Programs, resulting in net proceeds of approximately $292.1 million, after deducting agent commissions and issuance costs. As of December 31, 2022, we had cash, cash equivalents and restricted cash of $343.2 million.
The results of our operations for the year ended December 31, 2020 also include the results of operations of fuboTV post-Merger from April 1, 2020. Because of this, the results of operations for the years ended December 31, 2020 and 2019 are not comparable.
Because of this, certain of our results of operations for the year ended December 31, 2021 are not readily comparable to the results of operations for the year ended December 31, 2020.
Our evaluation of the accounting acquirer considered various indicators including voting rights, minority voting interest, composition of board of directors, composition of management and relative size of the entities.
In accounting for the Merger described in Note 5 to our consolidated financial statements in Part II, Item 8 of this Annual Report, judgment was required in determining the accounting acquirer. Our evaluation of the accounting acquirer considered various indicators including voting rights, minority voting interest, composition of board of directors, composition of management and relative size of the entities.
Nature of Business The Company is a leading live TV streaming platform for sports, news, and entertainment. The Company’s revenues are almost entirely derived from the sale of subscription services and the sale of advertisements in the United States, though the Company has started to expand into international markets, with operations in Canada, Spain and France.
Our revenues are almost entirely derived from the sale of subscription services and the sale of advertisements in the United States, though we have expanded into several international markets, with operations in Canada, Spain and France.
We believe our existing cash will provide us with the necessary liquidity to continue as a going concern for at least the next twelve months. In addition to the foregoing, based on our current assessment, we do not expect any material impact on our long-term development timeline and our liquidity due to the worldwide COVID-19 pandemic.
We believe our existing cash, cash equivalents and restricted cash will provide us with the necessary liquidity to continue as a going concern for at least the next twelve months.
See Note 16 in the accompanying consolidated financial statements for a further discussion of our cash commitments and contractual obligations, including lease obligations, market access agreements and sponsorship agreements. Our primary sources of cash are receipts from subscribers and advertising revenue as well as proceeds from equity and debt financings.
See Note 16 in the accompanying consolidated financial statements for a further discussion of our cash commitments and contractual obligations as of December 31, 2022, including lease obligations and sponsorship agreements, in addition to our discussion below regarding the dissolution of Fubo Gaming in October 2022.
Our primary uses of cash are content and programming license fees, operating expenses, including payroll-related, marketing, technology and professional fees, and expenses related to the launch and operations of our wagering business. We successfully raised $389.4 million, net of offering expenses, through the sale of 3.25% senior convertible notes in February 2021.
We successfully raised $389.4 million, net of offering expenses, through the sale of 3.25% senior convertible notes in February 2021.
Unanticipated events and circumstances may occur that may affect the accuracy or validity of such assumptions, estimates or actual results.
Unanticipated events and circumstances may occur that may affect the accuracy or validity of such assumptions, estimates or actual results. We also review our intangible assets for impairment whenever changes in circumstances indicate that the carrying amount of an asset is not recoverable.
Sales and marketing During the year ended December 31, 2020, we recognized sales and marketing expenses of $63.1 million as compared to $0.5 million during the year ended December 31, 2019.
Subscriber related expenses During the year ended December 31, 2021, we recognized subscriber related expenses of $593.2 million compared to $204.2 million during the year ended December 31, 2020.
Investing Activities For the year ended December 31, 2021, net cash used in investing activities was $76.2 million, which primarily consisted of $5.1 million of capital expenditures, $22.9 million for acquisitions, $39.8 million for payments for market access and license fee deposits, and $8.4 million for gaming licenses, market access fees related to the launch of our online wagering operations, and capitalization of internally developed software and technology application.
For the year ended December 31, 2021, net cash used in investing activities was $30.4 million, which primarily consisted of $3.4 million of capital expenditures, $4.1 million for capitalized internal use software, and $22.9 million for acquisitions.
As of December 31, 2021, we had cash and cash equivalents of $374.3 million. 58 We may be required to seek additional capital , including in the event we engage in repurchases of our debt or equity securities in the future.
We may be required to seek additional capital, including in the event we engage in repurchases of our debt or equity securities in the future. Subject to market conditions, we are considering various financing opportunities, which may include one or a combination of secured indebtedness, unsecured indebtedness and equity or equity-linked securities.
We expect the continued integration of gaming with our expansive live sports coverage will create a flywheel that lifts engagement and retention, expands advertising revenue through increased viewership, and creates additional opportunities for Attachment sales. We drive our business model with three core strategies: ● Grow our paid subscriber base ● Optimize engagement and retention ● Increase monetization.
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.
Subscriber related expenses During the year ended December 31, 2020, we recognized subscriber related expenses of $204.2 million due to affiliate distribution rights and other distribution costs in connection with the streaming revenue generated from the fuboTV business. There are no comparable results in the prior year.
The increase of $383.2 million was primarily due to an increase in affiliate distribution rights and other distribution costs resulting from an increase in subscribers. Broadcasting and transmission During the year ended December 31, 2022, we recognized broadcasting and transmission expenses of $73.4 million compared to $55.6 million during the year ended December 31, 2021.
These expenses were partially offset by a $8.3 million loss on investment recorded during 2019, $7.6 million gain on the sale of the Facebank AG and Nexway assets, $2.2 million change in fair value of profit share liability and $2.6 million unrealized gain on our equity method investment in Nexway. 56 Income tax benefit During the year ended December 31, 2020, we recognized an income tax benefit of $9.7 million compared to $5.3 million during the year ended December 31, 2019.
The decrease of $11.3 million is primarily related to a $4.4 million reduction in the change in fair value of warrant liabilities, a $0.4 million decrease in loss on extinguishment of debt, and a $1.8 million reduction of interest expense, partially offset by an increase of $12.5 million in amortization of debt discount. 58 Table of Conte nts Income tax benefit During the year ended December 31, 2022, we recognized an income tax benefit of $1.7 million compared to $2.7 million during the year ended December 31, 2021.
Our historical results are not necessarily indicative of the results that may be expected for any period in the future .
Our historical results are not necessarily indicative of the results that may be expected for any period in the future . Overview We are a sports-first, cable TV replacement product, offering subscribers access to tens of thousands of live sporting events annually, as well as leading news and entertainment content, both live and on demand.
The increase of $64.3 million was primarily related to $43.9 million of stock-based compensation, $16.7 million of incremental general and administrative expenses as a result of the acquisition of fuboTV Pre-Merger, $7.5 million in professional fees and $1.2 million in insurance partially offset by a reduction of $5.1 million of expenses related to Facebank AG and Nexway, which was sold during 2020.
The decrease of $7.8 million was primarily due to a decrease in stock-based compensation of $16.2 million, $7.6 million in sales tax and $5.7 million in professional fees, partially offset by a $15.6 million increase from the acquisition of Molotov and $4.7 million increase in salaries due to an increase in employee headcount.
ARPU is defined as total subscriber revenue collected in the period, also known as Platform Bookings (subscriber and advertising revenues excluding other revenues) divided by the average daily paid subscribers in such period divided by the number of months in the period. Our ARPU was $72.70 and $62.84 for the years ended December 31, 2021 and 2020, respectively.
We believe ARPU provides useful information for investors to gauge the revenue generated per subscriber on a monthly basis. ARPU, with respect to a given period, is defined as total Subscription revenue and Advertising revenue recognized in such period, divided by the average daily paid subscribers in such period, divided by the number of months in such period.
This seasonality is driven primarily by sports leagues, specifically the National Football League, which has a shorter partial-year season. In addition, we typically see subscribers on our platform decline from the fourth quarter of the previous year through the first and second quarter of the following year.
In addition, we typically see subscribers on our platform decline from the fourth quarter of the previous year through the first and second quarter of the following year. COVID-19 and Other Macroeconomic Factors The COVID-19 pandemic has created significant volatility, uncertainty, and economic disruption. In addition, mounting inflationary cost pressures and potential recession indicators have negatively impacted the global economy.
Technology and development During the year ended December 31, 2020, we recognized technology and development expenses of $30.2 million in connection with the development of our streaming platform after the Merger on April 1, 2020. There were no technology and development expenses recognized during the year ended December 31, 2019.
Technology and development During the year ended December 31, 2022, we recognized technology and development expenses of $69.3 million compared to $55.4 million during the year ended December 31, 2021.
Removed
The results of our operations for the year ended December 31, 2021 are not readily comparable against the results of our operations for the year ended December 31, 2020 as a result of our acquisitions of fuboTV Pre-Merger during 2020 and the acquisitions of Facebank AG and Nexway AG during 2019 that were disposed of in 2020.
Added
Recent Developments — Fubo Gaming Dissolution On October 17, 2022, we filed a Certificate of Dissolution with the Secretary of State of the State of Delaware to dissolve our wholly owned subsidiary, Fubo Gaming Inc. (“Fubo Gaming”). In connection with the dissolution of Fubo Gaming, we concurrently ceased operation of Fubo Sportsbook (as defined below).
Removed
We believe our expected expansion into wagering and interactivity is core to this model. We believe free-to-play predictive games enhance the sports streaming experience - while also providing a bridge between video and our sportsbook.
Added
Following the Merger, we changed our name from “FaceBank Group, Inc.” to “fuboTV Inc.,” and we changed the name of fuboTV Sub to “fuboTV Media, Inc.” The combined company operates under the name “Fubo,” and our trading symbol is “FUBO.” Unless otherwise stated, 2020 financial statements and metrics include FaceBank Pre-Merger from January 1, 2020 through March 31, 2020. 52 Table of Conte nts Nature of Business We are a leading live TV streaming platform for sports, news, and entertainment.
Removed
COVID-19 Update The widespread global impact from the outbreak and spread of the COVID-19 pandemic continued throughout 2021. We took precautionary measures to protect the health and safety of our employees and slow down the spread of the virus by transitioning our workforce to remote working as we closed our offices.
Added
On October 17, 2022, we ceased operation of our business-to-consumer online mobile sports book ("Fubo Sportsbook") in connection with the dissolution of Fubo Gaming. See "—Recent Developments—Fubo Gaming Dissolution". The results of operations of Fubo Sportsbook are presented as discontinued operations in our consolidated financial statements.
Removed
The global spread of COVID-19 and the various attempts to contain it created significant volatility, uncertainty, and economic disruption in 2020.
Added
Segments In connection with the dissolution of Fubo Gaming and the termination of Fubo Sportsbook, assets and liabilities and the operations of our former wagering reportable segment have been reported in discontinued operations for all periods presented. With respect to our continuing operations, we operate as a single reportable segment.
Removed
The impact of the COVID-19 pandemic on our operations began towards the end of the first quarter of 2020, impacting advertising markets and the availability of live sport events, as numerous professional and college sports leagues cancelled or altered seasons and events.
Added
Key Factors and Trends Impacting Performance Our financial condition and results of operations have been, and may in the future be, affected by a number of factors and trends, such as those described in Part II, Item 1A, “Risk Factors” and the following: Brand Awareness Building and maintaining a strong brand is important to our ability to attract and retain subscribers, as potential subscribers have a number of pay TV choices.
Removed
During 2021, the ongoing COVID-19 pandemic continued to accelerate the shift of TV viewing away from traditional pay TV to streaming TV and the on-going shift of advertising budgets away from traditional linear TV into streaming offering.
Added
We and our competitors must seek to attract a greater proportion of new subscribers from each other’s existing subscriber bases rather than from first-time purchasers of pay TV services.
Removed
While in 2021 we experienced an increase in TV streaming and our overall business was largely unaffected by the COVID-19 pandemic there can be no assurance that these positive trends will continue during the remainder of 2022 and beyond.
Added
As a result, we continue to experience increased competition, including from larger companies with greater resources to promote their brands through traditional forms of advertising, such as print media and TV commercials, as well as Internet advertising and website product placement.
Removed
Following the Merger, we changed our name from “FaceBank Group, Inc.” to “fuboTV Inc.,” and we changed the name of fuboTV Sub to “fuboTV Media, Inc.” The combined company operates under the name “fuboTV,” and our trading symbol is “FUBO.” 50 In accordance with the terms of the Merger Agreement, at the effective time of the Merger, all of the capital stock of fuboTV Sub was converted into the right to receive shares of our newly created class of Series AA convertible preferred stock, par value $0.0001 per share (the “Series AA Preferred Stock”).
Added
We primarily rely on paid marketing channels (such as social media, search advertising, display advertising, radio, out of home and television) to grow our brand and reach new subscribers. If these channels become less efficient our growth could be adversely affected.
Removed
Each share of Series AA Preferred Stock was entitled to 0.8 votes per share and was convertible into two (2) shares of our common stock following the sale of such share of Series AA Preferred Stock on an arms’-length basis either pursuant to Rule 144 under the Securities Act or pursuant to an effective registration statement under the Securities Act.
Added
Subscriber Acquisition, Retention and Engagement Our long-term growth will depend in part on our ability to grow and retain our subscriber base, as well as increase engagement by our subscribers. The relative service levels, content offerings, pricing and product experience of our platform will impact our ability to attract and retain subscribers versus our competitors.

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Other FUBO 10-K year-over-year comparisons