FuboTV shuts down online sports betting division

Streaming television provider FuboTV has put an end to its online sports betting project, Fubo Gaming, as well as its Fubo Sportsbook product after concluding a strategic review of the subsidiary’s operations.

The announcement was made on Monday, around the same time FuboTV revealed the organization’s preliminary quarterly earnings results, which boasted more than 1.2 million subscribers and income during the third quarter.

FuboTV initially revealed its intention to conduct a strategic review of Fubo Sportsbook at the start of August. During that period, the company sought a possible partner for the online sportsbook with little result. FuboTV revealed that a partner was needed for the subsidiary because it could not function on its own.

During the preliminary earnings results report, FuboTV disclosed that in their search for a partner, several parties had expressed interest in the sports betting operations. None of the parties, however, wanted to allow the parent company to decrease funding for the sports betting subsidiary; nor would they have let the firm distribute “sufficient returns” to its investors.

As a result, the tv streaming platform decided to cease all operations in the sportsbook at once. FuboTV also notably revealed that for the third quarter, the company expected a $100 million loss in adjusted earnings before EBIDTA (interest, taxes, depreciation, and amortization).

The co-founder and CEO of FuboTV, David Gandler, released a statement explaining that due to the current challenging economy, carrying on operations in Fubo Sportsbook and Gaming would not bode well for the company.

“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,” Gandler said.

FuboTV did not give any more information concerning the shutdown; however, the company will likely share the relevant details on November 4, during its third quarter analyst call.

Before the parent company shut down operations, Fubo Sportsbook was operational in places like Iowa, Arizona, and most recently, New Jersey. The sportsbook went live in New Jersey last month, Iowa in November 2021, and Arizona a month later. Fubo also reportedly had plans to expand into other US sports betting markets.

The company started making efforts to get into the sports betting world almost two years ago. At the time, Fubo had begun acquiring gaming technology companies. It notably purchased Vigtory in January 2021.

Fubo developed technology that enabled viewers using FuboTV to watch a game and see the game’s betting markets show up on their mobile devices. The betting options changed whenever the viewer moved to another game or match.

Fubo Gaming was allowed a temporary vendor license by the Indiana Gaming Commission (IGC) on September 22, a move usually followed by issuing an authorization to launch. Most state regulators usually launch a month after getting their temporary vendor license.

Fubo Gaming also applied to the Ohio-based NBA team, Cleveland Cavaliers, to be the organization’s online sportsbook partner or the service provider for the team’s mobile management.

The sportsbook site for New Jersey currently displays a screen claiming the site is “offline for maintenance” and will likely continue functioning in a few hours. The messages in the sportsbook’s Iowa and Arizona sites were similar.

The company’s CEO did not address the topic of returning funds, so it is not certain if the sportsbook’s account holders with funds will be able to get a hold of the money in their accounts.

Besides Fubo, other sports betting operators have pulled out of the US market this year. Penn Entertainment’s subsidiary, theScore, previously left the US markets to focus entirely on its Canada operations. Penn informed account holders beforehand of the options to withdraw their funds. The company’s Barstool Sportsbook will be its sports betting division in the US.

In February, Churchill Downs Inc. also revealed its intention to remove its TwinSpires division from the online sports betting market. The company has already stopped its online apps in Tennessee, Colorado, Michigan, Indiana, and New Jersey from operating.

Churchill Downs announced that it was gearing up to halt the operational sites in the states as well. Like Penn, account holders were notably given options to withdraw their money. The TwinSpires apps are operating in Arizona and Pennsylvania, at least for now.

More gambling news