7 unchanged sentences
We have incurred losses since inception.
−Removed: Our net loss for the year ended December 31, 2022 was $561.9 million.
+Added: Our net loss on continuing operations for the year ended December 31, 2023 was $293.1 million.
We expect that expanding our operations will cause our future operating expenses to increase.
9 unchanged sentences
Any debt financing we secure could involve restrictive covenants relating to our capital raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital and to pursue business opportunities, including potential acquisitions.
−Removed: If we were to violate the restrictive covenants, we could incur penalties, increased expenses and an acceleration of the payment terms of our outstanding debt, which could in turn harm our business.
+Added: If we were to violate the restrictive covenants contained in the indenture governing our 2029 Secured Convertible Notes (the “2029 notes indenture”) or in any future document governing our indebtedness, we could incur penalties, increased expenses and an acceleration of the payment terms of our outstanding debt, which could in turn harm our business.
We may not be able to obtain additional financing on terms favorable to us, if at all, due to unfavorable market conditions, including rising interest rates, or otherwise.
+Added: In addition, the 2029 notes indenture, and the exchange agreement entered into in connection with the issuance of the 2029 Secured Convertible Notes (the “Exchange Agreement), restrict our ability to incur certain indebtedness and issue certain equity securities.
If we are unable to obtain adequate financing or financing on terms satisfactory to us when we require it, our ability to support our business growth and to respond to business challenges could be significantly impaired, and our business may be harmed.
−Removed: Table of Conte nts
+Added: In addition, our cash, cash equivalents and restricted cash are maintained at financial institutions in amounts that exceed federally insured limits.
+Added: In the event of failure of any of the financial institutions where we maintain our cash, cash equivalents and restricted cash, there can be no assurance that we will be able to access uninsured funds in a timely manner or at all, and we may be obligated to seek alternative sources of liquidity.
+Added: Table o f Contents
Our revenue is subject to seasonality, and if subscriber behavior during certain seasons falls below our expectations, our business may be harmed.
1 unchanged sentence
We have previously experienced, and expect to continue to experience, effects of seasonal trends in subscriber behavior due to the seasonal nature of sports.
−Removed: We generate significantly higher levels of revenue and subscriber additions in the third and fourth quarters of the year, driven primarily by sports leagues, especially the National Football League.
+Added: We generate significantly higher levels of revenue and subscriber additions in the third and fourth quarters of the year, driven primarily by sports leagues, especially the National Football League and college football.
Our operating results may also be affected by the scheduling of major sporting events that do not occur annually, such as the World Cup or Olympic Games, or the cancellation or postponement of sporting events.
3 unchanged sentences
We anticipate that this seasonal impact on revenue is likely to continue, and any shortfall in expected revenue due to macroeconomic conditions, a decline in the effectiveness of our promotional activities, actions by our competitors, or for any other reason, would cause our results of operations to suffer significantly.
−Removed: For example, the COVID-19 pandemic has created significant volatility, uncertainty, and economic disruption and, in addition, mounting inflationary cost pressures and potential recession indicators have negatively impacted the global economy.
+Added: For example, the COVID-19 pandemic created significant volatility, uncertainty, and economic disruption and, in addition, mounting inflationary cost pressures and potential recession indicators have negatively impacted the global economy.
If these factors continue, or worsen, our revenue may be materially impacted.
7 unchanged sentences
We have experienced ownership changes in the past, and therefore a portion of our net operating loss carryforwards are subject to an annual limitation under Section 382 of the Code.
−Removed: In addition, we may experience ownership changes in the future as a result of subsequent changes in our stock ownership, including as a result of conversions of the 2026 Convertible Notes, some of which may be outside of our control.
+Added: In addition, we may experience ownership changes in the future as a result of subsequent changes in our stock ownership, including as a result of conversions of the 2026 Convertible Notes and 2029 Secured Convertible Notes, some of which may be outside of our control.
A past or future ownership change that materially limits our ability to use our historical net operating loss and tax credit carryforwards may harm our future operating results by effectively increasing our future tax obligations.
−Removed: Table of Conte nts
+Added: Table o f Contents
Our financial condition and results of operations could be adversely affected if we do not effectively manage our current or future debt.
As of December 31, 2023, we had $405.4 million of outstanding indebtedness on a consolidated basis which included $397.5 million of 2026 Convertible Notes and other notes outstanding with an aggregate principal of approximately $7.9 million.
+Added: In January 2024, the Company exchanged 2026 Convertible Notes with an aggregate principal of $205.8 million for 2029 Secured Convertible Notes with an aggregate principal of $177.5 million.
+Added: Additionally, the terms of the 2029 notes indenture allow for interest payments on the 2029 Secured Convertible Notes to be paid-in-kind.
+Added: If we choose to pay interest on the 2029 Secured Convertible Notes in kind, the aggregate principal amount of 2029 Secured Convertible Notes outstanding will increase.
Our obligations related to our outstanding or any future indebtedness could adversely affect our ability to take advantage of corporate opportunities, which could adversely affect our business, financial condition, and results of operations, including, but not limited to, the following:
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• if we fail to make required debt payments or to comply with other covenants in our debt agreements, we would be in default under the terms of these agreements, which could permit our creditors to accelerate repayment of the debt and could cause cross-defaults under other debt agreements.
+Added: For example, our failure to repay or refinance our 2026 Convertible Notes upon or prior to maturity may trigger an event of default under our 2029 Secured Convertible Notes.
We may also incur additional indebtedness to meet future financing needs.
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To the extent we are in non-compliance with the terms of such debt instruments, we may be required to make payments to the holders of such instruments, those holders may be entitled to the issuance of stock by us, and the holders of such stock may be entitled to registration or other investor rights.
+Added: Table o f Contents
Servicing our indebtedness will require a significant amount of cash, and we may not have sufficient cash flow from our business to pay our substantial indebtedness.
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If we are unable to generate such cash flow or raise further equity financing, we may be required to adopt one or more alternatives, such as reducing or delaying investments or capital expenditures, selling assets, refinancing or obtaining additional equity capital on terms that may be onerous or highly dilutive.
−Removed: We may need or desire to refinance our existing indebtedness, and there can be no assurance that we will be able to refinance any of our indebtedness on commercially reasonable terms, if at all.
+Added: Additionally, the terms of the 2029 notes indenture allow for interest payments on the 2029 Secured Convertible Notes to be paid-in-kind.
+Added: If we choose to pay interest on the 2029 Secured Convertible Notes in kind, the aggregate principal amount of 2029 Secured Convertible Notes outstanding will increase.
+Added: We may need or desire to repay, refinance, restructure or defease our existing indebtedness, including prior to its maturity, in one or more transactions, which may involve the payment of cash or the issuance of additional debt or equity securities.
+Added: There can be no assurance that we will be able to refinance any of our indebtedness on commercially reasonable terms, if at all.
Our ability to refinance existing or future indebtedness will depend on the capital markets and our financial condition at such time.
+Added: In addition, the terms of the 2029 notes indenture and the Exchange Agreement restrict our ability to incur certain indebtedness and issue certain equity securities.
We may not be able to engage in any of these activities or engage in these activities on desirable terms, which could result in a default on our current or future debt agreements.
−Removed: Table of Conte nts
Our operating results may fluctuate, which makes our results difficult to predict.
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• our ability to pursue and appropriately time our entry into new geographic or content markets and, if pursued, our management of this expansion;
+Added: Table o f Contents
• costs associated with defending any litigation, including intellectual property infringement litigation;
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While we assess our quarterly and annual guidance and update such guidance when we think it is appropriate, unanticipated future volatility can cause actual results to vary significantly from our guidance, even where that guidance reflects a range of possible results.
−Removed: Table of Conte nts
If we fail to effectively manage our growth, our business, operating results, and financial condition may suffer.
−Removed: Our growth to date has placed significant demands on our management and on our operational and financial infrastructure, and we expect these trends to continue in connection with further growth.
+Added: We have experienced significant growth rates in both the number of subscribers on our platform and revenue over the last few years.
+Added: As we grow larger and increase our subscriber base and usage, we expect it will become increasingly difficult to maintain the rate of growth we have experienced.
+Added: In addition, our growth to date has placed significant demands on our management and on our operational and financial infrastructure, and we expect these trends to continue in connection with further growth.
In order to attain and maintain profitability, we will need to recruit, integrate, and retain skilled and experienced personnel who can demonstrate our value proposition to subscribers, advertisers, and business partners and who can increase the monetization of our platform.
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We have been expanding our operations internationally, and as our international offering evolves, we are managing and adjusting our business to address varied content offerings, consumer customs and practices, in particular those dealing with e-commerce and streaming video, as well as differing legal and regulatory environments.
−Removed: We have experienced rapid growth rates in both the number of subscribers on our platform and revenue over the last few years.
−Removed: As we grow larger and increase our subscriber base and usage, we expect it will become increasingly difficult to maintain the rate of growth we currently experience.
Risks Related to Our Relationships with Content Providers, Customers and Other Third Parties
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Given the multiple-year duration, if subscriber acquisition and retention do not meet our expectations, our margins may be adversely impacted.
−Removed: In the past, we had long term programming deals that required minimum license fee payments and we failed to make certain of those minimum guarantee payments to certain key programmers.
−Removed: To the extent we fail to make any minimum guarantee payments in the future, if applicable, we may lose access to such content.
−Removed: We currently do not have any material programming deals that require minimum license fees in the United States.
+Added: In the past, we had long term programming deals that required minimum license guarantee payments and we failed to make certain of those minimum guarantee payments to certain key programmers.
+Added: We currently do not have any material programming deals that require minimum license fees in the United States, however, to the extent we fail to make any minimum guarantee payments in the future, if applicable, we may lose access to such content.
We also enter into multi-year commitments for content that we produce, either directly or through third parties, including elements associated with these productions such as non-cancelable commitments under talent agreements.
Payment terms for certain content commitments, such as content we directly produce, will typically require more up-front cash payments than other content licenses or arrangements whereby we do not fund the production of such content.
+Added: Table o f Contents
To the extent subscriber and/or revenue growth do not meet our expectations, our liquidity and results of operations could be adversely affected as a result of content commitments and payment requirements of certain agreements.
In addition, the long-term nature of certain of our commitments may limit our flexibility in planning for or reacting to changes in our business and the market segments in which we operate.
−Removed: If we license and/or produce content that is not favorably received by consumers in a territory, or is unable to be shown in a territory, acquisition and retention may be adversely impacted and given the long-term and fixed cost nature of certain of our content commitments, we may not be able to adjust our content offering quickly and our results of operations may be adversely impacted.
−Removed: Table of Conte nts
+Added: If we license and/or produce content that is not favorably received by consumers in a territory, or is unable to be shown in a territory, acquisition and retention may be adversely impacted and given the long-term and fixed cost nature of certain of our content commitments, as well as operational/technical costs tied to those commitments, we may not be able to adjust our content offering quickly and our results of operations may be adversely impacted.
Our results may be adversely affected if long-term content contracts are not renewed on sufficiently favorable terms.
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Even if these contracts are renewed, the cost of obtaining content rights may increase (or increase at faster rates than our historical experience).
−Removed: Moreover, our ability to renew these contracts on favorable terms may be affected by consolidation in the market for content distribution, the entrance of new participants in the market for distribution of content on digital platforms and other factors such as the impacts of COVID-19.
+Added: Moreover, our ability to renew these contracts on favorable terms may be affected by consolidation in the market for content distribution, the entrance of new participants in the market for distribution of content, the scale of our subscriber base and other factors.
With respect to the acquisition of content rights, particularly sports content rights, the impact of these long-term contracts on our results over the term of the contracts depends on a number of factors, including the strength of advertising markets, subscription levels and rates for content, effectiveness of marketing efforts and the size of viewer audiences.
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If we are unable to renew such agreements on a timely basis on mutually agreeable terms, we may be required to temporarily or permanently remove certain channels from our streaming platform.
−Removed: The loss of such channels from our streaming platform for any period of time may harm our business.
−Removed: More broadly, if we fail to maintain our relationships with the content providers on terms favorable to us, or at all, or if these content providers face problems in delivering their content across our platform, we may lose channel partners or subscribers and our business may be harmed.
+Added: The loss of such channels from our streaming platform for any period of time may harm our business, including as a result of customer confusion and/or dissatisfaction regarding the change in programming available on our platform.
+Added: If we fail to maintain our relationships with the content providers on terms favorable to us, or at all, or if these content providers face problems in delivering their content across our platform, we may lose channel partners or subscribers and our business may be harmed.
If our efforts to attract and retain subscribers are not successful, our business will be adversely affected.
We have experienced significant subscriber growth over the past several years.
−Removed: Our ability to continue to attract subscribers will depend in part on our ability to consistently provide our subscribers with compelling content choices and effectively market our platform.
+Added: Our ability to continue to attract subscribers will depend in part on our ability to consistently provide our subscribers with compelling content choices at competitive prices and effectively market our platform.
Furthermore, the relative service levels, content offerings, pricing and related features of our competitors may adversely impact our ability to attract and retain subscribers.
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If our efforts to satisfy our existing subscribers are not successful, we may not be able to attract subscribers, and as a result, our ability to maintain and/or grow our business will be adversely affected.
−Removed: Table of Conte nts
+Added: Table o f Contents
If consumers perceive a reduction in the value of our platform because, for example, we introduce new or adjust existing features, adjust pricing or platform offerings, or change the mix of content in a manner that is not favorably received by them, we may not be able to attract and retain subscribers.
−Removed: Subscribers cancel their subscription for many reasons, including due to a perception that they do not use the platform sufficiently, the need to cut household expenses, availability of content is unsatisfactory, competitive services provide a better value or experience and customer service issues are not satisfactorily resolved.
−Removed: We must continually add new subscriptions both to replace canceled subscriptions and to grow our business beyond our current subscription base.
+Added: Subscribers cancel their subscription for many reasons, including due to a perception that they do not use the platform sufficiently, the need to cut household expenses, the availability of content is unsatisfactory, competitive services provide a better value or experience and customer service issues are not satisfactorily resolved.
+Added: We must continually add new subscriptions both to replace canceled or expired subscriptions and to grow our business beyond our current subscription base.
While we permit multiple subscribers within the same household to share a single account for non-commercial purposes, if account sharing is abused, our ability to add new subscribers may be hindered and our results of operations may be adversely impacted.
If we do not grow as expected, given, in particular, that our content costs are largely contracted over several years, we may not be able to adjust our expenditures or increase our (per subscriber) revenues commensurate with the lowered growth rate such that our margins, liquidity and results of operations may be adversely impacted.
−Removed: Our results are also impacted by changes in the distribution strategy by the various content providers on our platform, which impacts our ability to accurately forecast subscriber growth and revenue.
−Removed: Some of these changes may include the simulcasting of sporting events that traditionally were only broadcasted on linear Pay TV, on “plus services” at generally lower prices.
−Removed: If we are unable to successfully compete with current and new competitors in both retaining our existing subscribers and attracting new subscribers, our business will be adversely affected.
+Added: Our business, financial condition, and results of operations are also impacted by changes in the distribution strategy by the various content providers on our platform.
+Added: This also impacts our ability to accurately forecast subscriber growth and revenue.
+Added: Some of these changes may include the simulcasting and/or exclusive streaming of content, including sporting events that traditionally were only broadcasted on linear Pay TV, on direct-to-consumer (“DTC”) “plus services” at generally lower prices.
+Added: If current or future content partners refuse to grant our subscribers access to stream certain channels or sporting events, or make their content available on their own DTC platform or our competitors’ platforms, whether exclusively or at more attractive pricing, this could adversely affect our ability to acquire and retain subscribers, which could materially and adversely affect our business, financial condition and results of operation.
+Added: In addition, if popular local sports programming, which has historically had limited carriage and distribution via regional sports networks, continues to shift to national broadcast networks and as a result continues to become more widely available on competitor platforms, including those that have not previously carried regionalized sports programming, it could adversely impact our ability to acquire this content, or to do so in cost-effective manner, or our ability to compete with current and new competitors.
+Added: If we are unable to successfully compete with current and new competitors in both retaining our existing subscribers and attracting new subscribers, our business could be adversely affected.
Further, if excessive numbers of subscribers cancel our service, we may be required to incur significantly higher marketing expenditures than we currently anticipate replacing these subscribers with new subscribers.
+Added: We are actively taking steps in response to actions by competitors that we believe are harmful to competition within the industry and to consumers.
+Added: For example, in February 2024, Disney, Fox and WBD announced the proposed formation of the Network JV, a forthcoming sports streaming service.
+Added: As announced on February 20, 2024, we have filed an antitrust lawsuit against the parties to the Network JV and certain of their affiliates, challenging the formation of the Network JV and their past business practices on antitrust grounds, and seeking injunctive relief to stop the proposed Network JV and other practices, and damages.
+Added: There can be no assurance, however, that we will be successful in this lawsuit.
+Added: If we are not successful in obtaining an injunction and defendants are permitted to operate the Network JV, and/or maintain certain business practices, our business, financial condition and results of operations could be materially and adversely affected.
Our agreements with certain distribution partners may contain parity obligations which limit our ability to pursue unique partnerships.
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In addition, delays in technical developments across our distribution partners puts us at risk of breaching our parity obligations with such distribution platforms, which threatens the certainty of our agreements with distribution partners.
+Added: Table o f Contents
If we are unable to maintain an adequate supply of ad inventory on our platform, our business may be harmed.
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We may not be able to compete effectively or adapt to any such changes or trends, which would harm our ability to grow our advertising revenue and harm our business.
−Removed: Table of Conte nts
If content providers refuse to license streaming content or other rights upon terms acceptable to us, our business could be adversely affected.
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For example, our content partners may prevent us from partnering with third party distributors and manufacturers to exploit new market opportunities or prevent us from bundling or reselling our products with third party products and services, or otherwise restrict how we might brand or market our products and services.
−Removed: Our content partners also impose restrictions on the content and composition of the packages we can make available to our customers and restrictions on how we might make some or all of our content available to customers (such as on a standalone basis, length of free trials or access modified or shorter form content).
+Added: Our content partners also impose restrictions on the content and composition of the packages we can make available to our customers and restrictions on how we might make some or all of our content available to customers (such as on a standalone basis, length of free trials/ previous or modified access or shorter form content).
These restrictions may prevent us from responding dynamically to changing customer expectations or market demands or exploiting lucrative partnership opportunities.
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Certain provisions in these agreements could become a challenge to comply with if we were to lose rights under agreements with key programmers.
+Added: Table o f Contents
In addition, our content partners generally impose requirements on us to treat them at least as favorably as other major providers in various ways, such as equal treatment with respect to content recommendations, displays on user interfaces, the marketing and promotion of content and streaming quality standards.
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A failure to maintain these obligations places us at risk of breaching our agreements with content providers, which could lead to loss of content and damages claims, which would have a negative impact on our products and service and our financial position.
−Removed: Table of Conte nts
We face risks, such as unforeseen costs and potential liability in connection with content we acquire, produce, license and/or distribute through our service.
1 unchanged sentence
We also may face potential liability for content used in promoting our service, including marketing materials.
−Removed: We are devoting more resources toward the development, production, marketing and distribution of original programming, including Fubo Sports Network and mobile games.
+Added: We are devoting more resources toward the development, production, marketing and distribution of original programming, including Fubo Sports Network and the Maximum Effort Channel.
We believe that original and exclusive programming can help differentiate our service from other offerings, enhance our brand and otherwise attract and retain subscribers.
1 unchanged sentence
As we have expanded our original programming, we have become responsible for production costs and other expenses, such as ongoing guild payments.
−Removed: We also take on risks associated with production, such as completion and key talent risk, which risks have been heightened during COVID-19.
+Added: We also take on risks associated with production, such as completion and key talent risk, which risks were heightened during COVID-19.
Further, negotiations or renewals related to entertainment industry collective bargaining agreements could negatively impact timing and costs associated with our productions.
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Litigation to defend these claims could be costly and the expenses and damages arising.
+Added: Table o f Contents
If our efforts to build a strong brand and to maintain customer satisfaction and loyalty are not successful, we may not be able to attract or retain subscribers, and our business may be harmed.
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Our competitors may be able to achieve and maintain brand awareness and market share more quickly and effectively than we can.
−Removed: Many of our competitors are larger companies and promote their brands through traditional forms of advertising, such as print media and TV commercials, and have substantial resources to devote to such efforts.
+Added: Many of our competitors are larger companies with substantial resources to devote to promoting their brands through traditional forms of advertising, such as print media and TV commercials, and have substantial resources to devote to such efforts.
Our competitors may also have greater resources to utilize Internet advertising or website product placement more effectively than we can.
−Removed: If we are unable to execute on building a strong brand, it may be difficult to differentiate our business and platform from our competitors in the marketplace;
−Removed: therefore, our ability to attract and retain subscribers may be adversely affected and our business may be harmed.
+Added: In addition, as our current and/or future content partners continue to shift content, including sporting events, that were traditionally only broadcasted on linear Pay TV, to their own platform or our competitors’ DTC platforms, whether exclusively or at more attractive prices, it could adversely affect our ability to build and differentiate our brand and value proposition to our subscribers.
+Added: If we are unable to execute on building a strong brand, differentiating our business and platform from our competitors in the marketplace, our ability to attract and retain subscribers may be adversely affected and our business may be harmed.
We rely upon a number of partners to make our service available on their devices.
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If we are not successful in maintaining existing and creating new relationships, or if we encounter technological, content licensing, regulatory, business or other impediments to delivering our streaming content to our subscribers via these devices, our ability to retain subscribers and grow our business could be adversely impacted.
−Removed: Table of Conte nts
Our business could be adversely affected if a number of our partners do not continue to provide access to our service or are unwilling to do so on terms acceptable to us, which terms may include the degree of accessibility and prominence of our service.
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If partners do not update or otherwise modify their devices, or if we discontinue support for certain devices, our service and our subscribers’ use and enjoyment could be negatively impacted.
−Removed: We rely upon Google Cloud Platform and Amazon Web Services to operate certain aspects of our service, and any disruption of or interference with our use of Google Cloud Platform and/or Amazon Web Services would impact our operations and our business would be adversely impacted.
+Added: We rely upon Google Cloud Platform and Amazon Web Services to operate certain aspects of our service, and any disruption of or interference with our use of Google Cloud Platform and/or Amazon Web Services would impact our operations and our business could be adversely impacted.
Each of Google Cloud Platform (“GCP”) and Amazon Web Services (“AWS”) provides a distributed computing infrastructure platform for business operations, or what is commonly referred to as a “cloud” computing service.
−Removed: We have architected our software and computer systems so as to utilize data processing, storage capabilities and other services provided by both GCP and AWS.
+Added: We have architected our software and information technology systems so as to utilize data processing, storage capabilities and other services provided by both GCP and AWS.
Currently, we run the vast majority of our computing on GCP with some key components running on AWS.
−Removed: Given this, along with the fact that we cannot easily switch what is specifically running now on GCP and/or AWS to another cloud provider, any disruption of or interference with our use of GCP and/or AWS would impact our operations, and our business would be adversely impacted.
+Added: Given this, along with the fact that we cannot easily switch what is specifically running now on GCP and/or AWS to another cloud provider, any disruption of or interference with our use of GCP and/or AWS would impact our operations, and our business could be adversely impacted.
Google (through YouTube TV) and, to a lesser extent, Amazon (through Amazon Prime) compete with us and, if Google or Amazon were to use GCP or AWS, respectively, in such a manner as to gain competitive advantage against our service, it could harm our business.
+Added: Table o f Contents
Risks Related to Our Financial Reporting and Disclosure
−Removed: We identified material weaknesses in our internal control over financial reporting in 2019 and 2020.
−Removed: We may identify material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, which could lead investors to lose confidence in the accuracy and completeness of our financial reports.
+Added: If we may identify material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, investors could lose confidence in the accuracy and completeness of our financial reports.
As a public company, we are required to maintain internal control over financial reporting and to report any material weaknesses in such internal control.
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Our independent registered public accounting firm is required to attest to the effectiveness of our internal control over financial reporting.
−Removed: In 2020 we identified material weaknesses in our internal control over financial reporting, which were remediated as of December 31, 2021.
The process of designing and implementing internal control over financial reporting required to comply with Section 404 of the Sarbanes-Oxley Act is time-consuming, costly, and complicated.
−Removed: If during the evaluation and testing process we identify one or more other material weaknesses in our internal control over financial reporting, our management will be unable to assert that our internal control over financial reporting is effective.
+Added: If during the evaluation and testing process we identify one or more material weaknesses in our internal control over financial reporting, our management will be unable to assert that our internal control over financial reporting is effective.
Even if our management concludes that our internal control over financial reporting is effective, our independent registered public accounting firm may conclude that there are material weaknesses with respect to our internal controls or the level at which our internal controls are documented, designed, implemented, or reviewed.
If we are unable to assert that our internal control over financial reporting is effective, or if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports, the market price of our common stock could be adversely affected and we could become subject to litigation or investigations by the stock exchange on which our securities are listed, the SEC or other regulatory authorities, which could require additional financial and management resources.
−Removed: Table of Conte nts
−Removed: If we fail to comply with the reporting obligations of the Exchange Act, our business, financial condition, and results of operations, and investors’ confidence in us, could be materially and adversely affected.
−Removed: As a public company, we are required to comply with the periodic reporting obligations of the Exchange Act, including preparing annual reports, quarterly reports, and current reports.
−Removed: In the past, prior to our merger with fuboTV Media Inc.
−Removed: (formerly known as fuboTV Inc.) in 2020, we failed to prepare and disclose this information in a timely manner.
−Removed: Our failure to prepare and disclose this information in a timely manner and meet our reporting obligations in their entirety could subject us to penalties under federal securities laws and regulations of the exchange we are listed on, expose us to lawsuits, and restrict our ability to access financing on favorable terms, or at all.
−Removed: We have experienced significant growth in the number of our employees and the scope of our operations to date and expect continued growth over the long term.
−Removed: As we expand, as a result of previously maintaining a limited staff, we may later determine that certain related party transactions were not properly identified, reviewed and approved prior to us entering into them with such related parties.
−Removed: Going forward, we will need to implement and improve our managerial, operational and financial systems, expand our facilities and recruit and train additional qualified personnel.
−Removed: Due to our limited financial resources and our limited experience in managing such anticipated growth, we may not be able to effectively manage the expansion of our operations or recruit and train additional qualified personnel.
−Removed: The expansion of our operations may lead to significant costs and may divert or stretch our management and business development resources in a way that we may not anticipate.
−Removed: Any inability to manage growth could delay the execution of our business plans or disrupt our operations.
−Removed: We will need to improve our operational and financial systems to support our expected long term growth, along with increasingly complex business arrangements, and rules governing revenue and expense recognition, and any inability to do so could adversely affect our billing services and financial reporting.
−Removed: We have increasingly complex business arrangements with our content publishers and licensees, and the rules that govern revenue and expense recognition in our business are increasingly complex.
−Removed: To manage the expected growth of our operations over the long term and increasing complexity, we will need to improve our operational and financial systems, procedures and controls and further increase systems automation to reduce reliance on manual operations.
−Removed: Any inability to do so will negatively affect our billing services and financial reporting.
−Removed: Our current and planned systems, procedures and controls may not be adequate to support our complex arrangements and the rules governing revenue and expense recognition for our future operations and expected growth.
−Removed: Delays or problems associated with any improvement or expansion of our operational and financial systems and controls could adversely affect our relationships with our subscribers, content publishers or licensees;
−Removed: cause harm to our reputation and brand;
−Removed: and could also result in errors in our financial and other reporting.
Our key metrics and other estimates are subject to inherent challenges in measurement, and real or perceived inaccuracies in those metrics may seriously harm and negatively affect our reputation and our business.
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If advertisers, partners, or investors do not perceive our subscriber, geographic, or other demographic metrics to be accurate representations of our subscriber base, or if we discover material inaccuracies in our subscriber, geographic, or other demographic metrics, our reputation may be seriously harmed, and our business and operating results could be materially and adversely affected.
−Removed: Table of Conte nts
Preparing and forecasting our financial results requires us to make judgments and estimates which may differ materially from actual results, and if our operating and financial performance does not meet the guidance that we provide to the public, the market price of our common stock may decline.
2 unchanged sentences
Using such estimates has the potential to negatively impact the results we report which could negatively impact our stock price.
+Added: Table o f Contents
In addition, from time to time, we release guidance regarding our future performance.
4 unchanged sentences
Impairment in the carrying value of goodwill or long-lived assets could negatively affect our operating results.
−Removed: We have a significant amount of goodwill and long-lived assets on our consolidated balance sheet.
+Added: We have a significant amount of goodwill and long-lived assets on our condensed consolidated balance sheet.
Under generally accepted accounting principles, annually, and upon the identification of a triggering event, management is required to perform an evaluation of the recoverability of goodwill and long-lived assets.
1 unchanged sentence
If business conditions or other factors cause profitability and cash flows to decline, we may be required to record non-cash impairment charges.
−Removed: If the carrying value of our reporting units exceeds their current fair value as determined based on the discounted future cash flows of the related business, the goodwill is considered impaired and is reduced to fair value by a non-cash charge to earnings.
+Added: If the carrying value of our reporting unit exceeds the current fair value, the goodwill is considered impaired and is reduced to fair value by a non-cash charge to earnings.
The Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that their net book value may not be recoverable.
1 unchanged sentence
Impairment, if any, is based on the excess of the carrying amount over the fair value, based on market value when available, or discounted expected cash flows, of those assets and is recorded in the period in which the determination is made.
−Removed: As a result of sustained decreases in the Company’s stock price and market capitalization, the Company conducted an interim impairment test of its goodwill and long-lived assets as of June 30, 2022.
−Removed: As a result of this testing, the Company recorded a non-cash goodwill impairment charge of $10.7 million for the wagering segment during the quarter ended June 30, 2022.
−Removed: The impairment charge represents all of the goodwill in the wagering segment.
−Removed: The Company tests goodwill for impairment at the reporting unit level on an annual basis on October 1 for each fiscal year or more frequently if events or changes in circumstances indicate that the carrying amount of goodwill may not be recoverable.
−Removed: The Company performed a qualitative analysis during its annual goodwill impairment test on October 1, 2022 and determined that it was more likely than not that goodwill was not impaired.
−Removed: Since October 1, 2022, the Company experienced sustained decreases in its stock price and market capitalization.
−Removed: As a result, the Company conducted an impairment test of its goodwill and long-lived assets as of December 31, 2022.
−Removed: The results of the impairment test also showed that the fair value of the streaming reporting unit was in excess of its carrying value by 3.5%.
−Removed: Therefore, it was determined that goodwill was not impaired and no impairment charge was recorded during the impairment test conducted as of December 31, 2022 for the streaming reporting unit.
−Removed: Table of Conte nts
−Removed: In addition, the Company determined that the Company’s initiation of a strategic review of its interactive wagering business in August 2022 constituted a triggering event, in that there will be a significant change in the extent and manner in which the long-lived assets of Fubo Sportsbook will be used, and there is an expectation that the assets will be sold or otherwise disposed of.
−Removed: For the year ended December 31, 2022, the Company determined the carrying value of the asset groups, within Fubo Sportsbook, did not exceed future undiscounted cash flows.
−Removed: The Company then calculated the fair value of the asset groups as the present value of the estimated future cash flows and determined that the carrying value exceeded the fair value in certain instances.
−Removed: Based on this analysis, the Company recognized an aggregate non-cash impairment charge of $76.7 million which represented substantially all of the long-lived assets of Fubo Sportsbook.
+Added: In August 2022, the Company initiated a strategic review of Fubo Sportsbook, and in October 2022 ceased operations of Fubo Sportsbook in connection with the dissolution of Fubo Gaming.
+Added: As a result, the Company recorded a non-cash impairment charge of $87.4 million for the wagering segment during the year ended December 31, 2022.
+Added: The impairment charge represented all of the goodwill and long-lived assets of Fubo Sportsbook.
While management cannot predict if or when additional future goodwill or long-lived asset impairments may occur, additional impairments could have material adverse effects on the Company’s operating income, net assets, and/or the Company’s cost of, or access to, capital.
+Added: Table o f Contents
Risks Related to Our Products and Technologies
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Effective monetization requires us to continue to update the features and functionality of our streaming platform for subscribers and advertisers.
−Removed: Companies such as AT&T, Comcast, Cox and Altice, along with MVPDs, such as YouTube TV, Hulu Live and Sling TV, offer TV streaming products that compete with our platform.
+Added: Companies such as AT&T, Comcast, Cox and Altice, along with virtual multichannel video programming distributors, such as YouTube TV, Hulu Live and Sling TV, offer TV streaming products that compete with our platform.
In many cases, these competitors have the financial resources to subsidize the cost of their streaming services in order to promote their other products and services making it harder for us to acquire new subscribers and increase hours streamed.
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Increased competition could reduce our market share, revenue and operating margins, increase our operating costs, harm our competitive position and otherwise harm our business.
−Removed: Table of Conte nts
If the advertisements and audience development campaigns and other promotional advertising on our platform are not relevant or not engaging to our subscribers, our growth in subscribers, advertisers and hours streamed may be adversely impacted.
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If we do not introduce relevant advertisements, audience development campaigns and other promotional advertising or such advertisements, audience development campaigns and other promotional advertising are overly intrusive and impede the use of our TV streaming platform, our subscribers may stop using our platform which will harm our business.
+Added: Table o f Contents
Our future growth depends on the acceptance and growth of OTT advertising and OTT advertising platforms.
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The future growth of our business depends on the growth of OTT advertising, and on advertisers increasing their spend on advertising on our platform.
−Removed: Although traditional TV advertisers have showed growing interest in OTT advertising, we cannot be certain that their interest will continue to increase or that they will not revert to traditional TV advertising, especially if our customers no longer stream TV or significantly reduce the amount of TV they stream either as a result of the end of the COVID-19 pandemic or for other reasons.
+Added: Although traditional TV advertisers have showed growing interest in OTT advertising, we cannot be certain that their interest will continue to increase or that they will not revert to traditional TV advertising, especially if our customers no longer stream TV or significantly reduce the amount of TV they stream.
If advertisers, or their agency relationships, do not perceive meaningful benefits of OTT advertising, the market may develop more slowly than we expect, which could adversely impact our operating results and our ability to grow our business.
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However, we may not be successful at expanding our content to areas outside our current content offering, or maintaining content from our current content offering, and even if we are able to expand into other content areas and sustain such expansion, we may not be successful in overcoming our reputation as primarily a live sports streaming service.
−Removed: Table of Conte nts
If TV streaming develops more slowly than we expect, our operating results and growth prospects could be harmed.
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If advertisers do not perceive meaningful benefits of TV streaming advertising, then this market may develop more slowly than we expect, which could adversely impact our operating results and our ability to grow our business.
+Added: Table o f Contents
Changes in competitive offerings for entertainment video, including the potential rapid adoption of piracy-based video offerings, could adversely impact our business.
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Companies also may enter into business combinations or alliances that strengthen their competitive positions.
−Removed: If we are unable to successfully compete with current and new competitors, our business will be adversely affected, and we may not be able to increase or maintain market share or revenues.
+Added: If we are unable to successfully compete with current and new competitors, our business could be materially and adversely affected, and we may not be able to increase or maintain market share or revenues.
Our products and services related to sports wagering subjected our business to a variety of related gaming laws, many of which are unsettled and still developing, and which could subject us to claims or otherwise harm our business.
The violation of any such laws, any adverse change in any such laws or their interpretation, or the regulatory climate applicable to these products and services, could have a material adverse effect on our financial condition and results of operations.
−Removed: We launched the Fubo Sportsbook app in Iowa and Arizona during the fourth quarter of 2021, and in New Jersey during the third quarter of 2022.
−Removed: Expansion of our business into sports wagering, including through third-party partnerships, has generally subjected us to the laws and regulations of the jurisdictions in which we conducted our business or in some circumstances, of those jurisdictions in which our services were offered or were available, as well as the general laws and regulations that apply to all e-commerce businesses, such as those related to privacy and personal information, tax and consumer protection and, potentially, any additional laws and regulations that may impact our business partners.
+Added: While Fubo Gaming dissolved and ceased operation of Fubo Sportsbook in October 2022, Fubo Gaming had launched the Fubo Sportsbook app in Iowa and Arizona during the fourth quarter of 2021, and in New Jersey during the third quarter of 2022.
+Added: Expansion of our business into sports wagering, including through third-party partnerships, has generally subjected us to the laws and regulations of the jurisdictions in which we conducted our business or in some circumstances, of those jurisdictions in which our services were offered or were available, as well as the general laws and regulations that apply to all e-commerce businesses, such as those related to the privacy and security of personal information, tax and consumer protection and, potentially, any additional laws and regulations that may impact our business partners.
These laws and regulations vary from one jurisdiction to another.
−Removed: While we have dissolved Fubo Gaming and ceased operation of Fubo Sportsbook as of the date of this Annual Report, we may to some extent remain subject to these laws and regulations as a result of the prior operation of Fubo Sportsbook or, if, and to the extent, we were to engage in gaming operations or otherwise partner with a third party subject to these laws and regulations in the future.
−Removed: Table of Conte nts
+Added: We may to some extent again become subject to these laws and regulations to the extent we were to engage in gaming operations or otherwise partner with a third party subject to these laws and regulations in the future.
In connection with the foregoing, future legislative and regulatory action, and court decisions or other governmental action, may have a material adverse impact on our operations and financial results.
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Such proceedings could have a material adverse effect on our business, financial condition, results of operations, and prospects, as well as impact our reputation.
−Removed: Our sports wagering business depended on the support of payment processors, the quality and cost of which may be variable in certain jurisdictions.
−Removed: Our sports wagering business depended on payment processing providers to facilitate the movement of funds between our sportsbook and our customer base.
−Removed: As a result of the decision to cease operations in October 2022, Fubo Gaming no longer accepts wagers or deposits, and all sportsbook customers' funds, which had been deposited into their accounts, but not wagered, as well as any winnings from wagers, have been processed for return to the sportsbook customers.
−Removed: However, certain transactions relating to the return of those funds remain dependent on payment processing providers and anything that could interfere with or otherwise harm the relationships with payment service providers could have a material adverse effect on our businesses.
−Removed: Our ability to facilitate withdrawals by them may be restricted by any introduction of legislation or regulations restricting financial transactions with online or mobile sports wagering operators or prohibiting the use of credit cards and other banking instruments for online or mobile sports wagering transactions, or by any other increase in the stringency of regulation of financial transactions, whether in general or in relation to the gambling industry in particular.
−Removed: Stricter money laundering regulations may also affect the quickness and accessibility of payment processing systems, resulting in added inconvenience to customers.
−Removed: Card issuers and acquirers may dictate how transactions and products need to be coded and treated which could also make an impact on acceptance rates.
−Removed: Card issuers, acquirers, payment processors and banks may also cease to process transactions relating to the online or mobile sports wagering industry as a whole or as to certain operators.
−Removed: This would be due to reputational and/or regulatory reasons or in light of increased compliance standards of such third parties that seek to limit their business relationships with certain industry sectors considered as “high risk” sectors.
−Removed: Any such developments may have a material and adverse effect on our future financial position.
−Removed: Table of Conte nts
+Added: Table o f Contents
If the technology we use in operating our business fails, is unavailable, or does not operate to expectations, our business and results of operation could be adversely impacted.
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There is no guarantee that the third-party geolocation and identity verification systems that we rely on will perform adequately or be effective.
−Removed: We rely on our geolocation and identity verification systems to ensure we are in compliance with certain laws and regulations, and any service disruption to those systems would prohibit us from operating our offerings and would adversely affect our business.
+Added: We rely on our geolocation and identity verification systems to ensure we are in compliance with certain laws and regulations, and any service disruption to those systems would prohibit us from operating our offerings and could adversely affect our business.
Additionally, incorrect or misleading geolocation and identity verification data with respect to current or potential users received from third-party service providers may result in us inadvertently allowing access to our offerings to individuals who should not be permitted to access them, or otherwise inadvertently deny access to individuals who should be able to access our offerings, in each case based on inaccurate identity or geographic location determination.
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If any of these risks materializes, we may be subject to disciplinary action, fines, lawsuits, and our business, financial condition and results of operations could be adversely affected.
−Removed: Table of Conte nts
+Added: We may face risks associated with our use of certain artificial intelligence and machine learning models.
+Added: Our business utilizes internally developed and third party artificial intelligence ("AI") and machine learning technologies, including in connection with offering interactive functionality on our platform.
+Added: In December 2021, we completed the acquisition of Edisn, an AI-powered computer vision platform with patent-pending video recognition technologies based in Bangalore, India.
+Added: We are, and plan in the future, to evaluate the further investment in and/or use artificial intelligence and machine learning technologies, including potential utilization by our business.
+Added: As with many technological innovations, artificial intelligence presents risks and challenges that could affect our ability to effectively use such technologies, and therefore our business.
+Added: If our AI tools are inadequately or incorrectly designed, improperly trained or used, or the data used to train them is incomplete, inadequate or biased in some way, our use of AI may inadvertently reduce our efficiency or cause unintentional or unexpected outputs that are incorrect, do not match our business goals, do not comply with our policies or standards or adversely affect our financial condition, business and reputation.
+Added: Table o f Contents
+Added: Artificial intelligence and machine learning technologies are complex and rapidly evolving, and we face significant competition from other companies in our industry as well as an evolving regulatory landscape.
+Added: These efforts, including the introduction of new products or changes to existing products, may result in new or enhanced governmental or regulatory scrutiny, litigation, ethical concerns, or other complications that could adversely affect our business, reputation, or financial results.
+Added: Changes to existing regulations, their interpretation or implementation or new regulations could impede our use of artificial intelligence and machine learning technology and also may increase the burden and cost of research and development in this area.
+Added: For example, in Europe, on December 8, 2023, the EU legislators reached a political agreement on the EU Artificial Intelligence Act (“EU AI Act”), which establishes a comprehensive, risk-based governance framework for artificial intelligence in the EU market.
+Added: The EU AI Act is expected to enter into force in 2024, and the majority of the substantive requirements will apply two years later.
+Added: The EU AI Act will apply to companies that develop, use and/ or provide artificial intelligence in the EU and includes requirements around transparency, conformity assessments and monitoring, risk assessments, human oversight, security, accuracy, general purpose artificial intelligence and foundation models, and proposes fines for breach of up to 7% of worldwide annual turnover.
+Added: In addition, on 28 September 2022, the European Commission proposed two Directives seeking to establish a harmonized civil liability regime for artificial intelligence in the EU, in order to facilitate civil claims in respect of harm caused by artificial intelligence and to include artificial intelligence-enabled products within the scope of the EU’s existing strict liability regime.
+Added: Once fully applicable, the EU AI Act will have a material impact on the way artificial intelligence is regulated in the EU, and together with developing guidance and/ or decisions in this area, may affect our use of artificial intelligence and our ability to provide and to improve our services, require additional compliance measures and changes to our operations and processes, result in increased compliance costs and potential increases in civil claims against us, and could adversely affect our business, operations and financial condition.
+Added: In addition to regulatory developments, there is an increase in litigation in a number of jurisdictions, including the United States, relating to the use of artificial intelligence, particularly generative artificial intelligence.
+Added: In addition, market acceptance of artificial intelligence and machine learning technologies is uncertain, and we may be unsuccessful in our product development efforts.
+Added: Any of these factors and regulatory developments, and together with developing guidance and/ or decisions in this area, could adversely affect our use of artificial intelligence and our ability to provide and to improve our services, our business, financial condition, and results of operations.
Risks Related to Regulation
−Removed: The gaming industry is heavily regulated and our failure to comply with applicable requirements could adversely affect our operations.
−Removed: In October 2022, we ceased operating our sportsbook.
−Removed: As a result of our previous gaming operations, we and our officers, directors, major shareholders, key employees, and business partners have generally been subject to the laws and regulations relating to wagering of the jurisdictions in which we conducted such business.
−Removed: The jurisdictions where we operated each have their own regulatory framework, which required us to receive a license.
−Removed: Each jurisdiction typically required us to make detailed and extensive disclosures as to our beneficial ownership, our source of funds, the suitability and integrity of certain persons associated with us, our management competence, structure, and business plans, our proposed geographical territories of operation, and our ability to operate a gaming business in a socially responsible manner in compliance with regulation.
−Removed: Such jurisdictions also imposed ongoing reporting and disclosure obligations, both on a periodic and ad hoc basis in response to material issues affecting the business.
−Removed: Our gaming-related technology was also subject to testing and certification, generally designed to confirm matters such as the fairness of the gaming products offered by the business, our compliance with applicable law and regulation, and our ability to accurately generate settlement instructions and recover from outages.
−Removed: Non-compliance with any such law or regulations could expose us to claims, proceedings, litigation and investigations by private parties and regulatory authorities, as well as substantial fines and negative publicity, each of which may have a material adverse effect on our business, financial condition, and results of operations.
We will be subject to regulatory investigations, which could cause us to incur substantial costs or require us to change our business practices in a materially adverse manner.
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In addition, there is a possibility that future orders issued by, or inquiries or enforcement actions initiated by, government or regulatory authorities may cause us to incur substantial costs, expose us to unanticipated civil and criminal liability or penalties, or require us to change our business practices that may have materially adverse effects to our business.
−Removed: Our shareholders may be subject to extensive governmental oversight, and if a shareholder is found unsuitable by a gaming authority, that shareholder may not be able to beneficially own, directly or indirectly, certain of our securities.
−Removed: While we have dissolved Fubo Gaming and ceased operation of Fubo Sportsbook as of the date of this Annual Report, our shareholders may to some extent remain subject to these laws and regulations as a result of our prior operation of Fubo Sportsbook or, if, and to the extent, we were to engage in gaming operations or otherwise partner with a third party subject to these laws and regulations in the future.
−Removed: A number of jurisdictions’ gaming laws have, and may in the future, require certain of our shareholders to file an application, be investigated, and qualify or have his, her, or its suitability determined by gaming authorities.
−Removed: Gaming authorities have very broad discretion when ruling on whether an applicant should be deemed suitable or not.
−Removed: Subject to certain administrative proceeding requirements, the gaming authorities have the authority to deny any application or limit, condition, revoke or suspend any gaming license, or fine any person licensed, registered or found suitable or approved, for any cause deemed reasonable by the gaming authorities.
−Removed: Any person found unsuitable by a gaming authority may not hold directly or indirectly ownership of any voting security or the beneficial or record ownership of any nonvoting security or any debt security of any company that is licensed with the relevant gaming authority beyond the time prescribed by the relevant gaming authority.
−Removed: A finding of unsuitability by a particular gaming authority impacts that person’s ability to associate or affiliate with gaming licenses in that specific jurisdiction and could impact the person’s ability to associate or affiliate with gaming license holders in other jurisdictions.
−Removed: Table of Conte nts
−Removed: Many jurisdictions also require any person who obtains a beneficial ownership of more than a certain percentage, most typically 5%, of voting securities of a publicly-traded gaming company or parent company thereof and, in some jurisdictions, non-voting securities to report the acquisition to gaming authorities.
−Removed: Gaming authorities may require such holders to apply for qualification or a finding of suitability, subject to limited exceptions for “institutional investors” that hold a company’s voting securities for investment purposes only.
−Removed: Other jurisdictions may also limit the number of gaming licenses with which a person may be associated.
−Removed: In connection with our prior operation of Fubo Sportsbook, we sought shareholder approval at our 2022 annual meeting of shareholders to adopt an amendment to our articles of incorporation to facilitate compliance with applicable gaming regulations and to otherwise operate in a manner consistent with best industry practices.
−Removed: This amendment, which was approved by our shareholders and subsequently adopted provides us with the right, subject to certain conditions set forth in the amendment to our articles of incorporation, to redeem shares held by an unsuitable person (a “Disqualified Holder”).
−Removed: Any redemption would be made at the per share purchase price equal to the average closing sale price of the shares as reported during the 30 trading days prior to the date upon which the company informs the shareholder of his, her or its status as a Disqualified Holder or, if the shares are not publicly traded at that time, the fair value of the shares as determined by the Board in accordance with the provisions of the amendment.
−Removed: Such redemption rights may negatively affect the trading price and/or liquidity of our shares.
−Removed: The utilization of such redemption rights may also negatively impact our cash flows and financial condition.
If government regulations relating to the Internet or other areas of our business change, we may need to alter the manner in which we conduct our business and we may incur greater operating expenses.
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Litigation and regulatory proceedings are inherently uncertain, and the laws and regulations governing issues such as privacy, payment processing, taxation and consumer protection related to the Internet continue to develop.
−Removed: As our service and others like us gain traction in international markets, governments are increasingly looking to introduce new or extend legacy regulations to these services, in particular those related to broadcast media and tax.
−Removed: For example, European law enables individual member states to impose levies and other financial obligations on media operators located outside their jurisdiction.
+Added: Table o f Contents
+Added: As our streaming service and others like us gain traction in the United States and international markets, governments are increasingly looking to introduce new or extend legacy regulations to these services, in particular those related to broadcast media and tax.
+Added: For example, in 2023 and 2024 Congress has held several hearings regarding the potential expansion of the Federal Communications Commission’s (“FCC”) regulations governing traditional Pay TV providers, such as cable and satellite providers, to include virtual multichannel video programming distributors (“vMVPDs”) that offer linear programming.
+Added: Any such expansion or changes to the laws or regulations governing vMVPDs could adversely impact our business.
+Added: In addition, European law enables individual member states to impose levies and other financial obligations on media operators located outside their jurisdiction.
Several jurisdictions have and others may, over time, impose financial and regulatory obligations on us.
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On a regular basis, however, parties in litigation seek to limit the scope of immunity under Section 230, and government officials and others propose to eliminate or reduce existing liability protections under Section 230 via legislation.
−Removed: This year, the U.S.
−Removed: Supreme Court is expected to address the scope of protection available to interactive computer service providers under Section 230 in circumstances where such providers recommend content to users, or potentially more broadly.
−Removed: Any changes to the scope of liability protection available to providers of interactive computer services could affect our ability to claim protection under Section 230.
−Removed: Table of Conte nts
+Added: In 2023, the U.S.
+Added: Supreme Court was presented with the opportunity to address the scope of protection available to interactive computer service providers under Section 230 in circumstances where such providers recommend content to users.
+Added: The Court ultimately declined to rule on this issue, however, thereby leaving intact the current scope of protection to which interactive computer service providers are entitled under Section 230.
+Added: Any future changes to the scope of liability protection available to providers of interactive computer services could affect our ability to claim protection under Section 230.
Moreover, as Internet commerce and advertising continues to evolve, increasing regulation by federal, state and foreign regulatory authorities becomes more likely.
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Although we do not believe taxes are due, we may be subject to penalties and interest by the tax authorities because of the late tax returns.
−Removed: There can be no assurance that we will remedy our delinquent filings sufficiently, and we may face penalties and fees which would adversely affect our operating results and investors’ confidence in our internal operations.
+Added: There can be no assurance that we will remedy our delinquent filings sufficiently, and we may face penalties and fees which could adversely affect our operating results and investors’ confidence in our internal operations.
+Added: Table o f Contents
We could be required to collect additional sales and other similar taxes or be subject to other tax liabilities that may increase the costs our customers would have to pay for our subscriptions and adversely affect our operating results.
9 unchanged sentences
The imposition by state governments or local governments of sales tax collection obligations on out-of-state sellers could also create additional administrative burdens for us and decrease our future sales, which could adversely affect our business and operating results.
−Removed: Table of Conte nts
We are subject to taxation-related risks in multiple jurisdictions.
14 unchanged sentences
Risks Related to Our Operations
−Removed: The COVID-19 pandemic and the global attempt to contain it may harm our industry, business, results of operations and ability to raise additional capital.
−Removed: The global spread of COVID-19 and the various attempts to contain it created significant volatility, uncertainty and economic disruption.
−Removed: In response to government mandates, health care advisories and employee concerns, we have altered certain aspects of our operations.
−Removed: Since early 2020, sports content has been impacted by COVID-19 due to travel restrictions and numerous professional and college sports leagues altering or, in some cases, cancelling seasons and events.
−Removed: As a result, our broadcasting partners had, and may in the future be required, to substitute other content in the place of previously scheduled live sporting events.
−Removed: While professional sports have generally returned, there is no guarantee that those seasons continue uninterrupted or at all.
−Removed: The potential further delay or cancellation of professional and college sports may cause us to temporarily have less popular content available on our platform, which could negatively impact consumer demand for and subscription retention to our platform and our number of paid subscribers.
−Removed: The full extent to which the COVID-19 pandemic and the various responses to it impacts our business, operations and financial results will depend on numerous evolving factors that we may not be able to accurately predict, including:
−Removed: the introduction of new strains of COVID-19;
−Removed: severity of future outbreaks;
−Removed: governmental, business and individuals’ actions that have been and continue to be taken in response to the pandemic;
−Removed: the actions of professional and college sports leagues;
−Removed: the availability and cost to access the capital markets;
−Removed: the effect on our subscribers and subscriber demand for and ability to pay for our platform;
−Removed: disruptions or restrictions on our employees’ ability to work and travel;
−Removed: and interruptions or restrictions related to the provision of streaming services over the internet, including impacts on CDNs and streaming quality.
−Removed: During any resurgences of COVID-19, we may not be able to provide the same level of customer service that our subscribers are used to, which could negatively impact their perception of our platform resulting in an increase in cancellations.
−Removed: There can be no assurance that financing may be available on attractive terms, if at all.
−Removed: With the increase in remote work during the COVID-19 pandemic and continued hybrid working environment, our workforce currently spends a significant amount of time working from home, which may impact their productivity.
−Removed: Such limitations caused by the pandemic have also resulted in us seeking extensions for our current and periodic filings with the SEC in some cases.
−Removed: We will continue to actively monitor the issues raised by the COVID-19 pandemic, including the spread of variants, and may take further actions that alter our business operations as may be required by federal, state, local or foreign authorities, or that we determine are in the best interests of our employees, subscribers and shareholders.
−Removed: It is not clear what the potential effects any such alterations or modifications may have on our business, including the effects on our subscribers, or on our financial results.
−Removed: Table of Conte nts
We could be subject to claims or have liability based on defects with respect to certain historical corporate transactions that were not properly authorized or documented.
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To the extent any such claims are successful, the claims could result in dilution to existing shareholders, payments by us to note holders or security holders, us having to comply with registration or other investor rights, which could have a material adverse effect on our business, financial condition and results of operations.
+Added: Table o f Contents
Legal proceedings could cause us to incur unforeseen expenses and could occupy a significant amount of our management’s time and attention.
6 unchanged sentences
Further, following the dissolution of Fubo Gaming in October 2022, we have received communications from several commercial partners of Fubo Gaming, alleging breach by Fubo Gaming of applicable agreements.
−Removed: Additional allegations, or litigation, may arise in the future related to the dissolution of Fubo Gaming, including potential breach of contract claims by other commercial partners of Fubo Gaming or claims related to guarantees by fuboTV Inc.
−Removed: of Fubo Gaming’s contractual obligations.
−Removed: Litigation disputes, including the disputes we are currently facing, could cause us to incur unforeseen expenses, result in content unavailability, and otherwise occupy a significant amount of our management’s time and attention, any of which could negatively affect our business operations and financial position.
+Added: Certain of these parties have also asserted that the Company is responsible for Fubo Gaming’s debts, such as by matter of law or through guaranty of Fubo Gaming’s obligations under applicable agreements.
+Added: On May 2, 2023, one such party (comprising two related plaintiff entities, Dynamo Stadium, LLC and Dynamo Soccer, LLC) filed Demands for Arbitration with the AAA against Fubo Gaming, alleging breaches by Fubo Gaming of a sports betting agreement and a sponsorship agreement, as well as against the Company for alleged guaranty obligations under the sports betting agreement.
+Added: On February 5, 2024, the AAA dismissed the arbitration relating to the sponsorship agreement, and, on February 27, 2024, the AAA dismissed without prejudice the arbitration relating to the sports betting agreement.
+Added: Additional allegations, or litigation, may arise in the future related to the dissolution of Fubo Gaming, including potential breach of contract claims by other commercial partners of Fubo Gaming or claims related to guarantees by the Company of Fubo Gaming’s contractual obligations.
+Added: In addition, from time to time, we may pursue litigation against third parties, including antitrust claims in response to actions by certain competitors that we believe are harmful to competition within the industry and to consumers.
+Added: For example, on February 20, 2022, we filed a lawsuit against the parties to the Network JV and certain of their affiliates, challenging the formation of the Network JV and the parties' past business practices on anticompetitive grounds, and seeking injunctive relief to stop the proposed Network JV and other practices, as well as damages.
+Added: Litigation disputes, including the disputes we are currently facing and/or pursuing, could cause us to incur unforeseen expenses, result in content unavailability, and otherwise occupy a significant amount of our management’s time and attention, any of which could negatively affect our business operations and financial position.
While the ultimate outcome of investigations, inquiries, information requests and related legal proceedings is difficult to predict, such matters can be expensive, time-consuming and distracting, and adverse resolutions or settlements of those matters may result in, among other things, modification of our business practices, reputational harm or costs and significant payments, any of which could negatively affect our business operations and financial position.
The quality of our customer support is important to our subscribers, and if we fail to provide adequate levels of customer support, we could lose subscribers, which would harm our business.
−Removed: Our subscribers depend on our customer support organization to resolve any issues relating to our platform.
−Removed: A high level of support is critical for the successful marketing of our platform.
−Removed: Providing high-level support is further challenging during the COVID-19 pandemic and resulting remote work environment.
−Removed: If we do not effectively train, update and manage our customer support organization that assists our subscribers in using our platform, and if that support organization does not succeed in helping them quickly resolve any issues or provide effective ongoing support, it could adversely affect our ability to sell subscriptions to our platform and harm our reputation with potential new subscribers.
−Removed: Table of Conte nts
+Added: Our subscribers depend on our customer support organization to resolve any issues relating to our platform, including pricing, product and technical issues.
+Added: A high level of support is necessary to acquire and retain our customers.
+Added: As we currently, or in the future, migrate from one business process outsourcing ("BPO") provider and/or location to new third party providers and/or geographies, we are presented with the challenges of effectively transitioning and ramping up new BPO operations and locations, while closing and phasing out existing operations.
+Added: This presents a significant challenge and risk to our overall ability in the short term to provide the level of customer support necessary and could adversely affect our ability to service new and current subscribers, which in turn could materially and adversely affect our business, financial condition and results of operations.
+Added: Table o f Contents
We may be unable to successfully expand our international operations and our international expansion plans, if implemented, will subject us to a variety of economic, political, regulatory and other risks.
1 unchanged sentence
In addition, we have limited experience managing the administrative aspects of a global organization.
−Removed: Outside of the United States, we operate in Canada, Spain, and, through our acquisition of Molotov, France.
−Removed: We also have offices and employees based in India through our acquisition of Edisn in December 2021.
+Added: Outside of the United States, we operate in Canada, Spain, and, through our acquisition of Molotov, we also operate in France.
+Added: We also have offices and employees based in India through our acquisition of Edisn Inc.
+Added: in December 2021.
While we intend to explore additional opportunities to expand our business in international markets in which we see compelling opportunities, we may not be able to create or maintain international market demand for our platform.
7 unchanged sentences
• challenges inherent in efficiently staffing and managing an increased number of employees over large geographic distances, including the need to implement appropriate systems, policies, compensation and benefits, and compliance programs;
−Removed: • political or social unrest, including the ongoing war between Russia and Ukraine, and economic instability;
+Added: • political or social unrest, including the ongoing war between Russia and Ukraine, conflicts in the Middle East and economic instability;
• compliance with laws such as the Foreign Corrupt Practices Act, UK Bribery Act and other anti-corruption laws, export controls and economic sanctions, and local laws prohibiting corrupt payments to government officials;
−Removed: • compliance with various privacy, data transfer, data protection, accessibility, consumer protection and child protection laws in the European Union and other international markets that we operate in;
+Added: • compliance with various privacy, data transfer, data protection, accessibility, consumer protection and child protection laws in the EU and other international markets that we operate in;
• difficulties in understanding and complying with local laws, regulations and customs in foreign jurisdictions, including local ownership requirements for streaming content providers and laws and regulations relating to privacy, data protection and information security, and the risks and costs of non-compliance with such laws, regulations and customs;
• regulatory requirements or government action against our service, whether in response to enforcement of actual or purported legal and regulatory requirements or otherwise, that results in disruption or non-availability of our service or particular content in the applicable jurisdiction;
−Removed: Table of Conte nts
+Added: Table o f Contents
• adverse tax consequences such as those related to changes in tax laws or tax rates or their interpretations, and the related application of judgment in determining our global provision for income taxes, deferred tax assets or liabilities or other tax liabilities given the ultimate tax determination is uncertain;
29 unchanged sentences
If one or more of these individuals leave, we may not be able to fully integrate new executives or replicate the current dynamic and working relationships that have developed among our senior management and other key personnel, and our operations could suffer.
−Removed: Table of Conte nts
+Added: Table o f Contents
The impact of worldwide economic conditions may adversely affect our business, operating results, and financial condition.
25 unchanged sentences
Also, any anticipated benefits from a given acquisition, including, but not limited to, the acquisition of Vigtory, Inc.
−Removed: in February 2021 and Edisn and Molotov in December 2021, may never materialize.
+Added: in February 2021 and Edisn Inc.
+Added: and Molotov in December 2021, may never materialize.
In addition, the process of integrating any businesses, products or technologies acquired by us may create unforeseen operating difficulties and expenditures and we may have difficulties retaining key employees.
−Removed: Acquisitions in international markets, including Edisn and Molotov, involve additional risks, including those related to integration of operations across different cultures and languages, currency risks and the particular economic, political and regulatory risks associated with specific countries.
+Added: Acquisitions in international markets, including Edisn Inc.
+Added: and Molotov, involve additional risks, including those related to integration of operations across different cultures and languages, currency risks and the particular economic, political and regulatory risks associated with specific countries.
We may not be successful in overcoming such risks, and such acquisitions and investments may negatively impact our business.
2 unchanged sentences
These fluctuations could arise from transaction-related costs and charges associated with eliminating redundant expenses or write-offs of impaired assets recorded in connection with acquisitions and investments and could negatively impact our financial results.
−Removed: Table of Conte nts
+Added: Table o f Contents
Risks Related to Privacy, Consumer Protection and Cybersecurity
2 unchanged sentences
The regulatory environment for the collection and processing of data relating to individuals, including subscriber and other consumer data, by online service providers, content distributors, advertisers and publishers is unsettled in the United States and internationally.
−Removed: Privacy groups and government bodies, including the Federal Trade Commission, increasingly have scrutinized issues relating to the use, collection, storage, disclosure, and other processing of data, including data that is associated with personal identities or devices, and we expect such scrutiny to continue to increase.
+Added: Privacy groups and government bodies, including the Federal Trade Commission ("FTC"), increasingly have scrutinized issues relating to the use, collection, storage, disclosure, and other processing of data, including data that is associated with personal identities or devices, and we expect such scrutiny to continue to increase.
Various federal, state and foreign government bodies and agencies have adopted or are considering adopting laws and regulations limiting, or laws and regulations covering the processing, collection, distribution, use, disclosure, storage, transfer and security of certain types of information.
In addition to government regulation, self-regulatory standards and other industry standards may legally or contractually apply to us, be argued to apply to us, or we may elect to comply with such standards or facilitate compliance by content publishers, advertisers, or others with such standards.
−Removed: For example, the CCPA became operative on January 1, 2020.
+Added: For example, in the United States, the CCPA became operative on January 1, 2020.
The CCPA requires covered businesses to provide new disclosures to California consumers, and to afford such consumers the ability to access and delete their personal information, opt out of certain personal information activities, and receive details about how their personal information is used.
−Removed: The CCPA provides for civil penalties for violations, as well as a private right of action for data breaches that has increased the likelihood of, and risks associated with, data breach litigation.
−Removed: California voters also approved a modification of the CCPA, the CPRA, which went into effect in January 2023.
+Added: The CCPA provides for civil penalties for violations, as well as a private right of action for certain data breaches that has increased the likelihood of, and risks associated with, data breach litigation.
+Added: California voters also approved a modification of the CCPA, the CPRA, which went into effect on January 1, 2023.
The CPRA significantly expands the rights granted to consumers under the CCPA.
−Removed: The CCPA and CPRA may increase our compliance costs and exposure to liability.
−Removed: Similarly, Virginia recently adopted the Virginia Consumer Data Protection Act ("VCDPA"), which went into effect in January 2023.
−Removed: The VCDPA will grant Virginia residents certain rights with respect to their personal data, has notice obligations, requires consent in some circumstances, among other things.
−Removed: While there is no private right of action, the VCDPA empowers the Attorney General to enforce the law.
−Removed: As with the CCPA and the CPRA, the VCDPA may increase our compliance costs and exposure to liability.
−Removed: New privacy laws will also become effective in Colorado, Connecticut, and Utah in 2023, and other U.S.
−Removed: states are considering adopting and/or enforcing similar laws and regulations.
−Removed: Additionally, our use of subscriber data to deliver relevant advertising on our platform places us and our content publishers at risk for claims under a number of other laws, including but not limited to the Video Privacy Protection Act ("VPPA").
−Removed: Some content publishers have been engaged in litigation over alleged violations of the VPPA relating to activities on online platforms in connection with advertising provided by unrelated third parties.
−Removed: The Federal Trade Commission ("FTC") has also revised its rules implementing the Children’s Online Privacy Protection Act ("COPPA Rules"), broadening the applicability of the COPPA Rules, including by expanding the types of information that are subject to these regulations.
−Removed: The COPPA Rules could effectively apply to limit the information that we and, our content publishers and advertisers collect and use, the content of advertisements and certain channel partner content.
+Added: The CCPA and CPRA and other similar state laws may increase our compliance costs and exposure to liability.
+Added: For example, Virginia, Colorado, Connecticut and Utah adopted information privacy laws that went into effect in 2023.
+Added: These laws grant consumers certain rights with respect to their personal information, have notice obligations, and require consent in some circumstances, among other things.
+Added: While there is no private right of action under these laws, they empower the attorneys general in the various states to enforce the laws.
+Added: As with the CCPA and the CPRA, these laws may increase our compliance costs and exposure to liability.
+Added: states have passed or are considering adopting and/or enforcing similar laws and regulations and there remains increased interest at the federal level as well.
+Added: Additionally, our use of subscriber data to deliver relevant advertising on our platform places us and our content publishers at risk for claims under a number of other laws, including but not limited to the Video Privacy Protection Act ("VPPA"), and we have been subject to such claims to date related to our practices with subscriber data.
+Added: In a recent trend, some content publishers have been engaged in litigation over alleged violations of the VPPA relating to activities on online platforms in connection with advertising provided by unrelated third parties, the results of which may impact our business.
+Added: Further, as an operator of an online service that is used in part by children, we are subject to the Children’s Online Privacy Protection Act (“COPPA”).
+Added: The FTC rule implementing COPPA (the "COPPA Rule") broadly defines the types of information that are subject to these regulations.
+Added: The COPPA Rules limit the information that we and, our content publishers and advertisers can collect and use, the content of advertisements and certain channel partner content.
We and our content publishers and advertisers could be at risk for violation or alleged violation of these and other laws, regulations, and other standards and contractual obligations relating to privacy, data protection, and information security.
More generally, the FTC and various state regulatory agencies are aggressively investigating and bringing enforcement actions that are focused on companies' collection, use, processing and sharing of consumer data, such as browsing information, for various uses, including but not limited to advertising.
−Removed: Other laws such as the Restore Online Shoppers' Confidence Act and analogous state laws require certain disclosures and consent mechanisms, among other things, in relation to recurring payments and subscription-based products or services.
−Removed: These rules are enforced by federal and state regulators and can subject companies to significant penalties, fines and injunctive relief.
−Removed: In the European Union (“EU”) and its member states, the GDPR, which has been in effect since May 25, 2018, imposes stringent obligations relating to data protection and security.
−Removed: Further, the departure of the United Kingdom (“UK”) from the EU has created a separate regime with similarly onerous obligations.
−Removed: The GDPR, and UK data protection law, each authorizes authorize regulators to impose sanctions, including changes to data processing, and each allow for fines of up to 4% of global annual revenue or €20 million (£17.5 million), whichever is greater, for certain violations.
−Removed: Additionally, we may incur expenses, costs, and other operational losses under the GDPR and the privacy laws of applicable EU Member States and the UK in connection with any measures we take to comply with such laws.
−Removed: Table of Conte nts
+Added: Table o f Contents
+Added: In the EU and its member states, the GDPR imposes stringent obligations relating to data protection and security for processing the personal data of individuals within the European Economic Area ("EEA") or in the context of our activities within the EEA.
+Added: Further, the departure of the United Kingdom (“UK”) from the EU has created a separate regime with similarly onerous obligations under the United Kingdom General Data Protection Regulation and Data Protection Act 2018 (collectively, the “UK GDPR”).
+Added: The GDPR and UK GDPR each authorize regulators to impose sanctions, including changes to data processing, and each allow for fines of up to 4% of the global annual revenue or €20 million (£17.5 million) of a noncompliant undertaking, whichever is greater, for certain violations.
+Added: In addition to fines, a breach of the GDPR or UK GDPR may result in regulatory investigations, reputational damage, orders to cease/ change our data processing activities, enforcement notices, assessment notices (for a compulsory audit) and/ or civil claims (including class actions).
+Added: Additionally, we may incur expenses, costs, and other operational losses under the GDPR, UK GDPR and the privacy laws of applicable EU Member States in connection with any measures we take to comply with such laws.
Although certain legal mechanisms have been designed to allow for the transfer of personal data from the UK, EEA and Switzerland to the United States, uncertainty about compliance with such data protection laws remains and such mechanisms may not be available or applicable with respect to the personal data processing activities necessary to research, develop and market our products.
−Removed: In particular in July 2020, the Court of Justice of the European Union (“CJEU”) limited how organizations could lawfully transfer personal data from the EU/EEA to the United States by invalidating the Privacy Shield for purposes of international transfers and imposing further restrictions on the use of standard contractual clauses (“SCCs”).
−Removed: The European Commission issued revised SCCs on June 4, 2021 to account for the decision of the CJEU and recommendations made by the European Data Protection Board.
−Removed: The revised SCCs must be used for relevant new data transfers from September 27, 2021;
−Removed: existing standard contractual clauses arrangements must be migrated to the revised clauses by December 27, 2022.
−Removed: The new SCCs apply only to the transfer of personal data outside of the EEA and not the United Kingdom;
−Removed: the UK’s Information Commissioner’s Office launched a public consultation on its draft revised data transfers mechanisms in August 2021 and laid its proposal before Parliament, with the UK SCCs expected to come into force in March 2022, with a grace period.
−Removed: There is some uncertainty around whether the revised clauses can be used for all types of data transfers, particularly whether they can be relied on for data transfers to non-EEA entities subject to the GDPR.
−Removed: As authorities issue further guidance on data transfer mechanisms, including circumstances where the SCCs cannot be used, and/or start taking enforcement action, we could suffer additional costs, complaints and/or regulatory investigations or fines, and/or if we are otherwise unable to transfer personal data between and among countries and regions in which we operate, it could affect the manner in which we provide our services, the geographical location or segregation of our relevant systems and operations, and could adversely affect our financial results.
−Removed: In recent years, European lawmakers and regulators have expressed concern over electronic marketing and the use of third-party cookies, web beacons and similar technology for online behavioral advertising.
−Removed: In the EEA and the U.K., under national laws derived from the ePrivacy Directive, informed consent is required for the placement of a cookie or similar technologies on a user’s device and for direct electronic marketing.
+Added: We expect the existing legal complexity and uncertainty regarding international personal data transfers to continue.
+Added: As a result, we may have to make certain operational changes and we may have to implement revised standard contractual clauses and other relevant documentation for existing data transfers within required time frames.
+Added: We are also subject to evolving EU and UK privacy laws on cookies, tracking technologies and e-marketing In the EEA and the UK, under national laws derived from the ePrivacy Directive, informed consent is required for the placement of a cookie or similar technologies on a user’s device and for direct electronic marketing.
The GDPR also imposes conditions on obtaining valid consent for cookies, such as a prohibition on pre-checked consents and a requirement to ensure separate consents are sought for each type of cookie or similar technology.
−Removed: The current national laws that implement the ePrivacy Directive are highly likely to be replaced across the EEA (but not directly in the UK) by the ePrivacy Regulation which will significantly increase fines for non-compliance.
−Removed: In addition, recent European court decisions and regulatory guidance are driving increased attention to cookies and tracking technologies.
−Removed: For example, in December 2020 the French data protection regulator (the CNIL) imposed fines of EUR 100 million and EUR 35 million respectively against certain entities for alleged breaches of cookies consent and transparency requirements;
−Removed: and in December 2021, the CNIL imposed fines of EUR 150 million and EUR 60 million against certain entities for alleged failures to allow users to easily reject cookies.
−Removed: Complying with the GDPR, CCPA, VCDPA, and other laws, regulations, and other obligations relating to privacy, consumer protection, data protection, data localization or security may cause us to incur substantial operational costs or require us to modify our data handling practices.
+Added: In addition, European court decisions and regulatory guidance are driving increased attention to cookies and tracking technologies.
+Added: If the trend of increasing enforcement by regulators of the strict approach to opt-in consent for all but essential use cases, as seen in recent guidance and decisions continues, this could lead to substantial costs, require significant systems changes, limit the effectiveness of our marketing activities, divert the attention of our technology personnel, adversely affect our margins, and subject us to additional liabilities.
+Added: Complying with the GDPR / UK GDPR, CCPA/CPRA, VCDPA, VPPA and other laws, regulations, and other obligations relating to privacy, consumer protection, data protection, data localization or security may cause us to incur substantial operational costs or require us to modify our data handling practices.
We also expect that there will continue to be new proposed laws and regulations concerning privacy, data protection and information security, and we cannot yet determine the impact such future laws, regulations and standards, or amendments to, expansions of or re-interpretations of, existing laws and regulations, industry standards, or other obligations may have on our business.
New laws and regulations, amendments to, expansions of or re-interpretations of existing laws and regulations, industry standards, and contractual and other obligations may require us to incur additional costs and restrict our business operations.
−Removed: Furthermore, the interpretation and application of laws, regulations, standards, contractual obligations and other obligations relating to privacy, data processing and protection, and information security are uncertain, and these laws, standards, and contractual and other obligations (including, without limitation, the Payment Card Industry Data Security Standard) may be interpreted and applied in a manner that is, or is alleged to be, inconsistent with our data management and processing practices, our policies or procedures, or the features of our platform.
−Removed: We may face claims or allegations that we are in violation of these laws, regulations, standards, or contractual or other obligations.
−Removed: We could be required to fundamentally change our business activities and practices or modify our platform or practices to address laws, regulations, or other obligations relating to privacy, data protection, or information security, or claims or allegations that we have failed to comply with any of the foregoing, which could have an adverse effect on our business.
−Removed: We may be unable to make such changes and modifications in a commercially reasonable manner or at all, and our ability to develop new features could be limited.
−Removed: Table of Conte nts
−Removed: Increased regulation of data collection, use and distribution practices, including self-regulation and industry standards, changes in existing laws and regulations, enactment of new laws and regulations, increased enforcement activity, and changes in interpretation of laws and regulations, all could increase our cost of compliance and operation, limit our ability to grow our business or otherwise harm our business.
Additionally, the costs of compliance with, and other burdens imposed by, the laws, regulations, and policies that are applicable to the businesses of content publishers and advertisers may limit their use and adoption of, and reduce the overall demand for, our platform and advertising on our platform, and content publishers and advertisers may be at risk for violation or alleged violation of laws, regulations, and other standards relating to privacy, data protection, and information security relating to their activities on our platform.
More generally, privacy, data protection, and information security concerns, whether or not valid, may inhibit market adoption of our platform, particularly in certain countries.
−Removed: Any actual or perceived inability to adequately address privacy, consumer protection, data protection or security-related concerns, even if unfounded, or to successfully negotiate privacy, data protection, consumer protection or security-related contractual terms with content publishers, card associations, advertisers, or others, or to comply with applicable laws, regulations and other obligations relating to privacy, data protection, and security, could result in additional cost and liability to us.
−Removed: We may face regulatory investigations and proceedings, claims and litigation by governmental entities and private parties, damages for contract breach, damage to our reputation, restrictions on the use of our platform by advertisers and sales of subscriptions to our platform, and additional liabilities as a result, all of which could harm our business, reputation, financial condition, and results of operations.
−Removed: Any significant interruptions, delays or discontinuations in service or disruptions in or unauthorized access to our computer systems or those of third parties that we utilize in our operations, including those relating to cybersecurity or arising from cyber-attacks, could result in a loss or degradation of service, unauthorized disclosure of data, including subscriber and corporate information, or theft of intellectual property, including digital content assets, which could adversely impact our business.
−Removed: Our reputation and ability to attract, retain and serve our subscribers is dependent upon the reliable performance and security of our computer networks and systems and those of third parties that we utilize in our operations.
−Removed: These systems may be subject to damage or interruption from, among other things, earthquakes, adverse weather conditions, other natural disasters, terrorist attacks, rogue employees, employees who are inattentive or careless and cause security vulnerabilities, power loss, telecommunications failures, and cybersecurity risks (for example, ransomware).
+Added: Furthermore, the interpretation and application of laws, regulations, standards, contractual obligations and other obligations relating to privacy, data processing and protection, and information security are uncertain, and these laws, standards, and contractual and other obligations may be interpreted and applied in a manner that is, or is alleged to be, inconsistent with our data management and processing practices, our policies or procedures, or the features of our platform.
+Added: We may face regulatory investigations, litigation, claims or allegations that we are in violation of these laws, regulations, standards, or contractual or other obligations.
+Added: We could be required to fundamentally change our business activities and practices or modify our platform or practices to address laws, regulations, or other obligations relating to privacy, data protection, or information security, or claims or allegations that we have failed to comply with any of the foregoing, which could have an adverse effect on our business.
+Added: We may be unable to make such changes and modifications in a commercially reasonable manner or at all, and our ability to develop new features could be limited.
+Added: Table o f Contents
+Added: Any actual or perceived inability to adequately address privacy, consumer protection, data protection or security-related concerns, even if unfounded, or to successfully negotiate privacy, consumer protection, data protection or security-related contractual terms with content publishers, card associations, advertisers, or others, or to comply with applicable laws, regulations and other obligations relating to privacy, data protection, and security, could result in additional cost and liability to us.
+Added: Any significant interruptions, delays or discontinuations in service or disruptions in or unauthorized access to our information technology systems or those of third parties that we utilize in our operations, including those relating to cybersecurity or arising from cyber-attacks, could result in a loss or degradation of service, unauthorized disclosure of data, including subscriber and corporate information, or theft of intellectual property, including digital content assets, which could adversely impact our business.
+Added: Our reputation and ability to attract, retain and serve our subscribers is dependent upon the reliable performance and security of our computer networks and information technology systems and those of third parties that we utilize in our operations.
+Added: These systems may be subject to attack, damage or interruption from, among other things, earthquakes, adverse weather conditions, other natural disasters, terrorist attacks, war, sophisticated nation-state and nation-state supported-actors, employee theft or misuse or employees who are inattentive or careless and cause security vulnerabilities, fraud, power loss, telecommunications failures, and cybersecurity risks (for example, ransomware).
Interruptions in these systems, or with the Internet in general, could make our service unavailable or degraded or otherwise hinder our ability to deliver our service.
−Removed: Service interruptions, errors in our software or the unavailability of computer systems used in our operations could diminish the overall attractiveness of our subscription to existing and potential subscribers.
−Removed: Our computer systems and those of third parties we use in our operations are subject to cybersecurity threats, including cyber-attacks such as computer viruses, denial of service attacks, physical or electronic break-ins and similar disruptions.
+Added: Service interruptions, errors in our software or the unavailability of information technology systems used in our operations could diminish the overall attractiveness of our subscription to existing and potential subscribers.
+Added: Our information technology systems and those of third parties we use in our operations are subject to cybersecurity threats, including cyber-attacks such as computer viruses, and malware, malicious code, denial or degradation of service attacks, hacking, phishing attacks and other social engineering schemes, physical or electronic break-ins and similar disruptions.
These systems periodically experience directed attacks intended to lead to interruptions and delays in our service and operations as well as loss, misuse or theft of personal information and other data, content, confidential information, trade secrets or intellectual property.
Additionally, outside parties may attempt to induce employees or subscribers to disclose sensitive or confidential information, or to take advantage of software or hardware bugs and vulnerabilities, in order to gain access to data.
−Removed: Any attempt by hackers to obtain our data (including subscriber and corporate information) or intellectual property (including digital content assets), disrupt our service, or otherwise access our systems, or those of third parties we use, if successful, could harm our business, be expensive to remedy and damage our reputation.
+Added: Any attempt by hackers to obtain our data (including subscriber and corporate information) or intellectual property (including digital content assets), disrupt our service, or otherwise access our systems, or those of third parties we use could harm our business, be expensive to remedy and damage our reputation.
+Added: We and certain of our third-party providers regularly experience cyberattacks and other incidents, and we expect such attacks and incidents to continue.
As previously disclosed, we suffered one such incident on December 14, 2022, when we experienced service outage as a result of a criminal cyber-attack.
6 unchanged sentences
Problems faced by us or our third-party cloud computing or other network providers, including technological or business-related disruptions, as well as cybersecurity threats and regulatory interference, could adversely impact the experience of our users.
−Removed: Table of Conte nts
+Added: Table o f Contents
We have implemented certain systems and processes designed to thwart hackers and protect our data and systems, but the techniques used to gain unauthorized access to data, systems, and software are constantly evolving, and we may be unable to anticipate or prevent unauthorized access, and we may be delayed in detecting unauthorized access or other security breaches and other incidents.
9 unchanged sentences
The successful assertion of one or more large claims against us that exceed available insurance coverage, or the occurrence of changes in our insurance policies, including premium increases or the imposition of large deductible or co-insurance requirements, could have a material adverse effect on our business, including our financial condition, operating results, and reputation.
−Removed: Table of Conte nts
Risks Related to Our Intellectual Property
We could become subject to litigation regarding intellectual property rights that could be costly and harm our business.
−Removed: Third parties have previously asserted, and may in the future assert, that we have infringed, misappropriated, or otherwise violated their intellectual property rights.
−Removed: While the existence of our patent portfolio may deter some plaintiffs from asserting claims against us, from time to time we have faced, and expect in the future to face, allegations from “non-practicing entities.” Because these non-practicing entities have no relevant product revenue, and they exist primarily for the purpose of monetizing their patent portfolio through licensing and litigation, they may not be deterred by our own issued patents and pending patent applications in bringing intellectual property rights claims against us.
+Added: Third parties have previously asserted, and may in the future assert, that we have infringed, misappropriated, or otherwise violated their patent, trademark, copyright, or other intellectual property rights.
+Added: Due to a large number of patents in the streaming field, it is not economically feasible to predict whether any product or component will infringe the patent rights of others.
Defending ourselves against intellectual property infringement claims, whether or not they have merit, could be costly and could result in the diversion of resources and management time and attention, even if we are ultimately successful in the defending the claim.
−Removed: If a claim is successfully asserted against us, in addition to being liable for damages, our ability to use our current streaming technology and market our service could be restricted.
+Added: If a claim is successfully asserted against us, in addition to being liable for damages and/or indemnification of customers or partners, our ability to use our current streaming technology and market our service could be restricted.
We may also have to remove content from our service, or marketing materials.
3 unchanged sentences
The occurrence of any of the foregoing events could harm our business.
+Added: In addition, while the existence of our patent portfolio may deter some plaintiffs from asserting claims against us, from time to time we have faced, and expect in the future to face, allegations from “non-practicing entities.” Because these non-practicing entities have no relevant product revenue, and they exist primarily for the purpose of monetizing their patent portfolio through licensing and litigation, they may not be deterred by our own issued patents and pending patent applications in bringing intellectual property rights claims against us
+Added: Table o f Contents
As a result of intellectual property infringement claims, or to avoid potential claims, we have previously chosen to, and may in the future choose or be required to, seek licenses from third parties.
5 unchanged sentences
and to indemnify our partners and other third parties.
+Added: The inability to obtain intellectual property rights or licenses on favorable terms, or the need to engage in litigation related to these matters, may materially impact our business and financial condition.
An inability to obtain licenses for our streaming content from suppliers or other rights holders could be costly and harm our business.
7 unchanged sentences
Increases in royalty rates or changes to other terms of these licenses could have an impact on how much our content providers charge us, and accordingly they may materially impact our business, operating results, and financial condition.
−Removed: Table of Conte nts
Additionally, our content suppliers may develop their own streaming services and may be unwilling to provide us with access to certain content.
6 unchanged sentences
Further, these agreements do not prevent our competitors or partners from independently developing technologies that are substantially equivalent or superior to our platform.
+Added: Table o f Contents
We have filed and we expect to file from time to time for trademark and patent applications.
13 unchanged sentences
In addition, certain open source licenses require that source code for software programs that are subject to the license (including, in certain cases, source code of proprietary software that is distributed with or linked to open source software) be made available to licensees or the public, and that any modifications or derivative works to such software continue to be licensed under potentially unfavorable terms or at no or minimal cost.
−Removed: Table of Conte nts
Although we monitor our use of open-source software in an effort both to comply with the terms of the applicable open source licenses and to avoid subjecting our software to conditions we do not intend, the terms of many open-source licenses have not been interpreted by U.S.
8 unchanged sentences
If we are unable to obtain necessary third-party licenses, we may be required to obtain substitute technologies with lower quality or performance standards, or at a greater cost, any of which could harm the competitiveness of our platform and our business.
+Added: Table o f Contents
Risks Related to the 2026 Convertible Notes
5 unchanged sentences
In addition, our ability to repurchase the 2026 Convertible Notes or to pay cash upon conversions of all or a portion of the 2026 Convertible Notes or at their maturity may be limited by law, regulatory authority or agreements governing our future indebtedness.
−Removed: Our failure to repurchase all or a portion of the 2026 Convertible Notes at a time when the repurchase is required by the indenture or to pay cash upon conversions of all or a portion of the 2026 Convertible Notes or at their maturity as required by the indenture would constitute a default under the indenture.
−Removed: A default under the indenture or the fundamental change itself could also lead to a default under agreements governing our future indebtedness.
−Removed: Moreover, the occurrence of a fundamental change under the indenture could constitute an event of default under any such agreement.
−Removed: A default under the indenture or the fundamental change itself could also lead to a default under agreements governing our existing or future indebtedness.
+Added: Our failure to repurchase all or a portion of the 2026 Convertible Notes at a time when the repurchase is required by the indenture governing the 2026 Convertible Notes (the “2026 notes indenture”) or to pay cash upon conversions of all or a portion of the 2026 Convertible Notes or at their maturity as required by the 2026 notes indenture would constitute a default under the 2026 notes indenture.
+Added: A default under the 2026 notes indenture or the fundamental change itself could also lead to a default under agreements governing our existing or future indebtedness, including the 2029 notes indenture.
+Added: Moreover, the occurrence of a fundamental change under the 2026 notes indenture could constitute an event of default under any such agreement.
If the payment of the related indebtedness were to be accelerated after any applicable notice or grace periods, we may not have sufficient funds to repay the indebtedness and repurchase the notes or make cash payments upon conversions thereof.
−Removed: Table of Conte nts
The conditional conversion feature of all or a portion of the 2026 Convertible Notes, if triggered, may adversely affect our financial condition and operating results.
3 unchanged sentences
The accounting method for convertible debt securities that may be settled in cash, such as the 2026 Convertible Notes, could have a material effect on our reported financial results.
−Removed: In August 2020, the Financial Accounting Standards Board published an Accounting Standards Update (“ASU”) 2020-06, which amends these accounting standards by reducing the number of accounting models for convertible instruments and limiting instances of separate accounting for the debt and equity or a derivative component of the convertible debt instruments.
+Added: In August 2020, the Financial Accounting Standards Board ("FASB") published an Accounting Standards Update ("ASU") 2020-06, which amends these accounting standards by reducing the number of accounting models for convertible instruments and limiting instances of separate accounting for the debt and equity or a derivative component of the convertible debt instruments.
ASU 2020-06 no longer allows the use of the treasury stock method for convertible instruments and instead requires application of the “if-converted” method.
1 unchanged sentence
The Company adopted the ASU on January 1, 2022.
+Added: Table o f Contents
Provisions in the indenture for the 2026 Convertible Notes may deter or prevent a business combination that may be favorable to you.
1 unchanged sentence
In addition, if a make-whole fundamental change occurs prior the maturity date, we will in some cases be required to increase the conversion rate for a holder that elects to convert all or a portion of their 2026 Convertible Notes in connection with such make-whole fundamental change.
−Removed: Furthermore, the indenture for the 2026 Convertible Notes will prohibit us from engaging in certain mergers or acquisitions unless, among other things, the surviving entity assumes our obligations under the 2026 Convertible Notes.
+Added: Furthermore, the 2026 notes indenture will prohibit us from engaging in certain mergers or acquisitions unless, among other things, the surviving entity assumes our obligations under the 2026 Convertible Notes.
These and other provisions in the indenture could deter or prevent a third party from acquiring us even when the acquisition may be favorable to you.
−Removed: Table of Conte nts
+Added: Risks Related to the 2029 Secured Convertible Notes
+Added: We may not have the ability to raise the funds necessary to settle conversions of the 2029 Secured Convertible Notes in cash or to repurchase the 2029 Secured Convertible Notes upon a fundamental change, and our future debt may contain limitations on our ability to pay cash upon conversion or repurchase of the 2029 Secured Convertible Notes.
+Added: Holders of the 2029 Secured Convertible Notes will have the right to require us to repurchase all or a portion of the 2029 Secured Convertible Notes upon the occurrence of a fundamental change before the maturity date at a repurchase price equal to 100% of the principal amount of the 2029 Secured Convertible Notes to be repurchased, plus accrued and unpaid cash interest, if any.
+Added: In addition, upon conversion of the 2029 Secured Convertible Notes, unless we elect to deliver solely shares of our common stock to settle such conversion (other than paying cash in lieu of delivering any fractional share), we will be required to make cash payments in respect of the notes being converted.
+Added: Moreover, we will be required to repay the 2029 Secured Convertible Notes in cash at their maturity unless earlier converted or repurchased.
+Added: However, we may not have enough available cash or be able to obtain financing at the time we are required to make repurchases of all or a portion of the 2029 Secured Convertible Notes surrendered therefor or pay cash with respect to notes being converted or at their maturity.
+Added: In addition, our ability to repurchase the 2029 Secured Convertible Notes or to pay cash upon conversions of all or a portion of the 2029 Secured Convertible Notes or at their maturity may be limited by law, regulatory authority or agreements governing our future indebtedness.
+Added: Our failure to repurchase all or a portion of the 2029 Secured Convertible Notes at a time when the repurchase is required by the 2029 notes indenture or to pay cash upon conversions of all or a portion of the 2029 Secured Convertible Notes or at their maturity as required by the 2029 notes indenture would constitute a default under the 2029 notes indenture.
+Added: A default under the 2029 notes indenture or the fundamental change itself could also lead to a default under agreements governing our existing or future indebtedness, including the 2026 notes indenture.
+Added: Moreover, the occurrence of a fundamental change under the 2029 notes indenture could constitute an event of default under any such agreement.
+Added: If the payment of the related indebtedness were to be accelerated after any applicable notice or grace periods, we may not have sufficient funds to repay the indebtedness and repurchase the notes or make cash payments upon conversions thereof.
+Added: The conditional conversion feature of all or a portion of the 2029 Secured Convertible Notes, if triggered, may adversely affect our financial condition and operating results.
+Added: In the event the conditional conversion feature of any or all of the 2029 Secured Convertible Notes is triggered, holders of the 2029 Secured Convertible Notes will be entitled to convert their 2029 Secured Convertible Notes at any time during specified periods at their option.
+Added: If one or more holders elect to convert 2029 Secured Convertible Notes, unless we elect to satisfy our conversion obligation by delivering solely shares of our common stock (other than paying cash in lieu of delivering any fractional share), we would be required to settle a portion or all of our conversion obligation in cash, which could adversely affect our liquidity.
+Added: In addition, even if holders of the 2029 Secured Convertible Notes do not elect to convert their 2029 Secured Convertible Notes, we could be required under applicable accounting rules to reclassify all or a portion of the outstanding principal of the 2029 Secured Convertible Notes as a current rather than long-term liability, which would result in a material reduction of our net working capital.
+Added: Table o f Contents
+Added: Provisions in the indenture for the 2029 Secured Convertible Notes may deter or prevent a business combination that may be favorable to you.
+Added: If a fundamental change occurs prior to the maturity date of the 2029 Secured Convertible Notes, holders of the 2029 Secured Convertible Notes will have the right, at their option, to require us to repurchase all or a portion of their 2029 Secured Convertible Notes.
+Added: In addition, if a make-whole fundamental change occurs prior the maturity date, we will in some cases be required to increase the conversion rate for a holder that elects to convert all or a portion of their 2029 Secured Convertible Notes in connection with such make-whole fundamental change.
+Added: Furthermore, the 2029 notes indenture will prohibit us from engaging in certain mergers or acquisitions unless, among other things, the surviving entity assumes our obligations under the 2029 Secured Convertible Notes.
+Added: These and other provisions in the 2029 notes indenture could deter or prevent a third party from acquiring us even when the acquisition may be favorable to you.
+Added: The terms of the 2029 notes indenture and the Exchange Agreement place restrictions on our operating and financial flexibility.
+Added: If we raise additional capital through debt financing, the terms of any new debt could further restrict our ability to operate our business.
+Added: The 2029 Secured Convertible Notes are senior, secured obligations of us and our wholly-owned subsidiaries guaranteeing the notes (the “2029 Notes Guarantors”), secured by substantially all of our and 2029 Notes Guarantors’ assets (including intellectual property), in each case, excluding certain excluded assets and immaterial subsidiaries, and senior in right of payment to our existing and future indebtedness that is expressly subordinated to the 2029 Secured Convertible Notes.
+Added: Subject to certain exceptions, our future material wholly-owned domestic subsidiaries are required to become guarantors of the 2029 Secured Convertible Notes and grant security interests in their assets securing the obligations in respect of the 2029 Secured Convertible Notes.
+Added: The 2029 notes indenture restricts our ability to, among other restrictions, incur additional secured indebtedness, pursue certain dispositions, mergers or acquisitions, transfer certain assets to any of our subsidiaries that are not guarantors under the 2029 Secured Convertible Notes, and engage in certain other business transactions.
+Added: If we fail to comply with these or any of the other covenants under the 2029 notes indenture and are unable to obtain a waiver or amendment, the holders of the 2029 Secured Convertible Notes may, among other things, declare all of the 2029 Secured Convertible Notes due and payable and exercise rights with respect to collateral securing the 2029 Secured Convertible Notes, each of which could significantly harm our business, financial condition and prospects and could cause the price of our common stock to decline.
+Added: In addition, pursuant to the terms of the Exchange Agreement, we agreed, among other things, to grant the exchanging investors identified therein certain rights with respect to us and certain of our subsidiaries, including a right of first refusal with respect to the incurrence of additional secured indebtedness, participation rights with respect to the incurrence of unsecured indebtedness, and preemptive rights with respect to the issuance of certain equity securities, in each case subject to the terms set forth in the Exchange Agreement.
+Added: If we raise any additional debt financing, the terms of such additional debt could further restrict our operating and financial flexibility.
+Added: Table o f Contents
Risks Related to Ownership of our Common Stock
2 unchanged sentences
The factors include:
−Removed: • global and regional macroeconomic conditions, including as a result of the COVID-19 pandemic;
+Added: • global and regional macroeconomic conditions;
• variations in our operating results;
18 unchanged sentences
A decline in the price of shares of our common stock might impede our ability to raise capital through the issuance of additional shares of our common stock or other equity securities.
−Removed: Table of Conte nts
+Added: Table o f Contents
We also filed Form S-8 registration statements to register shares reserved for future issuance under our equity compensation plans.
23 unchanged sentences
Such losses could adversely affect our business prospects, results of operations, cash flows and financial condition.
−Removed: Unresolved Staff Comments.
−Removed: Table of Conte nts
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.