DirecTV reports rise in first-quarter profit
EmptyNEW YORK -- Satellite TV giant DirecTV on Wednesday reported a 10.4% jump in its first-quarter profit, besting Wall Street estimates as it signed up more subscribers than expected thanks to demand for its TV, high-definition TV and DVR services.
The news came just days after Time Warner Cable recorded better-than-projected basic cable user gains.
DirecTV also said John Malone's Liberty Media, which controls the company, has agreed to keep its voting stake at the current 47.9% even while DirecTV buys back stock under a new $3 billion stock-repurchase program. Analysts said the move gives Liberty more time to decide its next move.
Liberty has increased its stake in DirecTV since an asset swap with News Corp. gave it a 41% holding in late February. However, if Liberty buys even slightly more than 50%, it would have to make an offer for 100% of DirecTV.
DirecTV reported a first-quarter profit of $371 million, driven by a 17% revenue improvement to $4.59 billion that also exceeded expectations.
DirecTV added 275,000 net U.S. subscribers, boosting its overall user base to 17.1 million as of March 31. The additions marked an uptick in momentum from the 235,000 year-ago gains and exceeded average Wall Street expectations for about 200,000 customer adds.
It also added 200,000 net subscribers in Latin America, boosting its base to 3.5 million.
President and CEO Chase Carey touted the "overall strength of our business" and said the weak U.S. economy and housing market "has not had a material impact on the results."
DirecTV shares closed up 4.7% at $27.01, close to the stock's 52-week high of $27.73.