It's not often that companies reveal their quarterly results ahead of schedule. Typically, though, if they do it, it's because the period in question was either significantly better than expected or significantly worse.
Fortunately for fuboTV (FUBO -3.50%) shareholders, in this case, it was the former. Management was eager to get the word out that revenue and subscriber growth are trending better than it forecast in Q4.
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Why fuboTV stock jumped last week
When it announced its third-quarter results on Nov. 9, fuboTV provided guidance about how much revenue and subscriber growth it expected to deliver in the fourth quarter. Its estimate for revenues in the $205 million and $210 million range would have amounted to a 97% increase from the year before at the midpoint. Additionally, it forecast that its subscriber count would grow to between 1.06 million and 1.07 million, which would have been a similar increase of 94% year over year at the midpoint.
In the preliminary announcement on Monday, fuboTV management said they now expect revenue will land in the $215 million to $220 million range -- a full $10 million above the previous forecast. What's more, it now projects its subscriber count will exceed 1.1 million. That's 40,000 more than the low end of the range it was guiding for two months ago.
"fuboTV's strong preliminary fourth-quarter 2021 results close out a pivotal year where we made meaningful advancements against our mission to define a new category of interactive sports and entertainment television," said CEO and co-founder David Gandler. "In the fourth quarter, we continued to deliver triple-digit revenue growth, alongside operating leverage, through the efficient deployment of acquisition spend and the retention of high-quality customer cohorts."
Of course, this news pleased shareholders and the market, which shot the stock higher by more than 7% following the announcement. The stock has since given up those gains amid a broad-based rotation from growth stocks to value investments, trading 3.2% lower since the preliminary release. This stock got hammered in 2021, and last week's pre-released earnings only provided temporary relief.
Management left out a key detail
There was something notably missing from fuboTV's preliminary Q4 report. The company did not provide any profit or loss figures. In Q3, it lost $105 million on the bottom line while generating revenue of $157 million. Those massive losses are concerning; there's still some question as to whether or not fuboTV's business model can eventually reach a profitable scale.
Additionally, the consistent losses are draining the company's balance sheet. As of Sept. 30, fuboTV had $393 million in cash on hand, and during the third quarter, it lost $143 million in cash from operations.
Management now says that it expects to report that it ended Q4 with $375 million in cash on hand. However, it is unclear if it raised any capital in the quarter by selling stock or borrowing funds. Nevertheless, fuboTV's preliminary results are good news for shareholders. Investors should stay tuned for more details when the company announces completed Q4 results in the coming weeks.
