Fubo Shuts Down Sportsbook After Streaming Service Can’t Find a Partner
Posted on: October 17, 2022, 08:32h.
Last updated on: October 18, 2022, 01:06h.
Fubo Sportsbook, the online sports betting operator that was a subsidiary of streaming television provider FuboTV, abruptly ended its operations on Monday. That’s after the parent company completed a strategic review of its operations.
The company first announced its strategic review of the online sportsbook in early August. At that time, Fubo officials were hoping to find a partner for sports betting. They felt the sports-centric TV streaming platform service could not operate it independently.
On Monday, as it posted preliminary financial figures for the third quarter, FuboTV announced announced “multiple parties” inquired about the sports betting operations. However, none of the potential partnerships would have let the company reduce its funding in the operation or allowed the company to provide “sufficient returns” to investors.
Because of that, FuboTV pulled the plug on the sportsbook “effective immediately.”
Following our previously announced strategic review, we have concluded that continuing with Fubo Gaming and Fubo Sportsbook in this challenging macroeconomic environment would impact our ability to reach our longer term profitability goals,” FuboTV co-founder and CEO David Gandler said in a statement.
He added that the company would offer “more color” when it holds its third quarter earnings call on Nov. 4.
A company spokesperson declined to answer follow-up questions, saying Fubo did not have additional information to share at this time.
The company also said Monday it expected a loss of $100 million in adjusted earnings before interest, taxes, depreciation, and amortization (EBIDTA) for the third quarter.
Sportsbook Sites Down
Fubo was operational in Arizona, Iowa, and New Jersey. New Jersey went live just last month.
A visit to the sportsbook’s New Jersey site brought up a screen saying the site was “offline for maintenance” and expected to be back online in a couple hours. On the Arizona and Iowa sites, those said the site was not available for now but to “check back soon.”
It’s uncertain if Fubo account holders who still have money in their accounts will be able to access those funds.
Besides those states, Fubo was in the process of expanding into other markets.
On Sept. 22, the Indiana Gaming Commission (IGC) approved a temporary vendor license to Fubo Gaming. state regulators typically followed that by issuing a launch authorization. In a review of other authorizations, some launched within a month or so after receiving their temporary license.
It also applied to be the mobile management service provider, or online sportsbook partner, for the Cleveland Cavaliers in Ohio.
Fubo Not The First
Efforts at Fubo to enter sports betting started nearly two years ago when the company began making acquisitions of gaming technology companies. That included Vigtory, which it purchased in January 2021.
The sportsbook launched in Iowa last November and in Arizona a month later.
The company had developed technology that would allow the viewer watching a game through FuboTV to instantly have betting markets for that game pop up on their mobile device. If they switched to another game or match, the betting options would change to that sporting event.
Fubo is not the first sports betting operator to leave the US market this year.
Churchill Downs Inc. announced in February that it would exit online sports betting markets where its TwinSpires division held licenses. It has already terminated online apps in Colorado, Indiana, Michigan, New Jersey, and Tennessee. But the company announced in advance when it would shut down sites in those states. TwinSpires also gave account holders options for withdrawing funds.
TwinSpires apps are still operational, for now, in Arizona and Pennsylvania.
Penn Entertainment’s theScore also pulled out of US states earlier this year to focus on operating in its native Canada. Penn also operates Barstool Sportsbook, which will serve as Penn’s US sports betting division.
Like TwinSpires, theScore Bet gave notice to account holders and options for them to withdraw funds.
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