Subscriber losses clear Dish's plate in Q2
Company loses 25,000 net subscribers in quarterIt appears that the tech-focused, more complicated of Charlie Ergen's two satellite TV companies is the more impressive one, as far as Wall Street is concerned.
After EchoStar Communications and Dish Network reported second-quarter financial results Monday, shares of the former went higher while shares of the latter sunk lower.
The problem with Dish on Monday was more of the same: disappointing subscription metrics. This time, the company lost 25,000 net subscribers and blamed a weak economy as well as competitor DirecTV's push to lure customers away with an appealing HD package.
"This is the fourth quarter in a row of weak results from Dish," Kaufman Bros. analyst Todd Mitchell said. "We had expected some stabilization. This has not happened."
He added that a 1.9% spike in churn is "one of the highest levels we have ever seen."
Dish, which now boasts 13.8 million subscribers compared with 17 million at DirecTV, posted net income of $335.9 million, up from $224.2 million a year ago. Revenue rose 5.6% to $2.91 billion.
Shares of Dish fell 3.6% on Monday to $27.91. Also weighing on the stock in recent months is AT&T's intention to terminate a joint marketing relationship with Dish at year's end.
EchoStar, which sells set-top boxes and satellite services to Dish and other clients, fared better Monday. Dish and EchoStar split into two companies seven months ago, with Ergen being chairman and CEO of both.
EchoStar, which still relies on Dish for the bulk of its sales, swung to a second-quarter profit of $47.8 million compared with a loss of $14.8 million a year ago. Revenue rose 46% to $483.3 million.
Shares of EchoStar rose 1.5% on Monday to $32.48.
DirecTV is set to report earnings Thursday.