Dish Net chafes less in Q1

Ergen says reshuffled executive team still has 'a lot of work' to do

Shares of Dish Network soared as much as 20% on Monday following first-quarter results that came in better than Wall Street expected.

The satellite TV giant reported a higher first-quarter profit as it continued to lose subscribers. The company posted a profit of $313 million, up 21% compared with $259 million in the year-ago period. Revenue rose 2.1% to $2.9 billion. Dish lost 94,000 subscribers in the latest quarter, but analysts had on average expected it would lose 128,000.

"Hopefully, we're on a path to getting better," chairman and CEO Charles Ergen said during a conference call. He acknowledged that his recently reshuffled management team still needs to do "a lot of work" to turn the business around.

"Dish Network reported better than expected subscriber and financial metrics for the first quarter after reporting several quarters of disappointing results," Goldman Sachs analyst Ingrid Chung said. "We find it noteworthy that Dish's average revenue per user was still up 3% year-over-year despite the promotional activity in the quarter (versus DirecTV, which was up 0.8% year-over-year) and that subscriber acquisition cost was down 7% year-over-year, which implies to us that management is balancing profitability with subscriber growth." Chung said she would review her price target and estimates.

Dish shares closed up 17.1% Monday at $17.92.

Meanwhile, sibling EchoStar swung to a first-quarter loss as it sold less equipment to Dish. The maker of set-top boxes and other technology posted red ink of $645,00, compared with a year-ago profit of $5.7 million. Revenue declined 14% to $480 million.

EchoStar's stock finished at $17.29, down 0.1%. (partialdiff)