FuboTV Inc. and The Walt Disney Company announced a definitive agreement in January 2025 to combine Disney’s Hulu + Live TV business with Fubo, creating a combined subscriber base exceeding 6.2 million in North America.
FUBO stock soared 5x following the announcement and with clickstream data we can evaluate the merits of the transaction and track how the subscriber base is developing post the transaction. Hulu and ESPN have been struggling with active users and Fubo growth has also turned negative. While users have remained steady post transaction, challenges are likely to persist in the combined business.
Combining Disney’s Hulu + Live TV business with Fubo
FuboTV Inc. and The Walt Disney Company announced a definitive agreement to combine Disney’s Hulu + Live TV business with Fubo, creating a new virtual MVPD company. Under the terms of the agreement, Disney will own approximately 70% of the combined entity, which will be led by Fubo’s existing management team, including CEO David Gandler. The merger is expected to enhance consumer choice by offering a broader range of programming options. Fubo will create a new Sports & Broadcast service featuring Disney’s premier sports networks, including ESPN and ABC. The transaction also includes a settlement of all litigation between Fubo and Disney, with Disney committing to a $145 million term loan to Fubo in 2026 and an aggregate cash payment of $220 million at closing.
Operates as Separate Businesses
The combined entity will operate under the Fubo publicly traded company name (NYSE: FUBO). Following the transaction, Disney will become the majority owner of the combined company, which will include both Fubo and Hulu + Live TV businesses. The existing Fubo management team, led by CEO David Gandler, will continue to operate the newly combined businesses.
In connection with the Transaction, Disney will enter into a new carriage agreement with Fubo that will allow Fubo to create a new Sports & Broadcast service, featuring Disney’s premier sports and broadcast networks including ABC, ESPN, ESPN2, ESPNU, SECN, ACCN, ESPNEWS, as well as ESPN+.
Both Fubo and Hulu + Live TV will remain available to consumers as separate offerings post-closing.
FUBO Previously Guided to 1.7M Subscribers
The data indicates that Fubo ended the third quarter with 1,613,000 paid subscribers in North America, which is a 9% increase year-over-year. For the Rest of World, they have over 378,000 subscribers. Looking forward, Fubo’s guidance for North America subscribers in the fourth quarter is between 1.665 million to 1.705 million, representing a 4% year-over-year growth at the midpoint. For the Rest of World, they expect 345,000 to 355,000 subscribers in the fourth quarter, which represents a 14% year-over-year decline at the midpoint.
Clickstream Subscriber Insights
The users index shows that ESPN and Hulu have a user base 7-9x larger than that of Fubo, though Fubo experienced significantly higher growth throughout the year. However, user growth turned negative for Fubo in the last two months of 2024.
