To say that FuboTV (FUBO +0.00%) is off to a great start in 2025 would be a major understatement. Shares of the sports-focused streaming provider are up by a staggering 272% for the week, heading into Friday.
The big news is that Walt Disney's (DIS +0.87%) Hulu+ Live streaming service and FuboTV are combining their streaming services into one product, which should be well positioned to compete with the leading live streaming service from YouTube. The combined company will retain the FuboTV name and ticker symbol, although Disney will own a 70% stake in the business.
NYSE: FUBO
Key Data Points
A big win for FuboTV and its investors
Between the two existing platforms, there are 6.2 million total subscribers. As my colleague Rick Munarriz recently pointed out, the average revenue per user of the existing services is over $80 per month, so this implies a business with nearly $6 billion in annual revenue right away. And that's not to mention that the platform could become more valuable and attractive to new customers by combining some of the most unique features of both, such as FuboTV's collection of regional sports networks.
Disney will pay FuboTV $220 million in cash as part of the deal and will also provide the business with a $145 million term loan next year (the deal is expected to close in 12 to 18 months). If regulators choose to block the deal, FuboTV will be entitled to a $130 million termination fee.
Could the stock go even higher from here?
It's also worth noting that the big value here could be the potential long-term effects of establishing a mutually beneficial relationship with Disney. For example, Disney owns the ESPN family of networks and is gearing up to launch an ESPN streaming service later this year, and FuboTV's sports focus could come in handy.
