Dish Network’s Surprising Q1 Sub Growth Helps It To Beat Profit Forecasts
The No. 2 satellite company added 104,000 subscribers, bringing its total to 14.1M. Analysts only expected to see a pick up of about 88,000. The company attributes its strong performance to a decline in its churn rate — helped by the fact that it didn’t increase its subscription prices the way it did last year. The financials are a little more complicated: Dish generated $360.3M in net income, down 34.5% vs the same period last year, on revenues of $3.6B, up 11.1%. The decrease in profit is partly due to the fact that last year’s results had a $341M boost from a reversal of litigation expenses following the settlement of the patent infringement lawsuit with TiVo. The revenue figure was in line with analyst forecasts. And earnings, at 80 cents a share, beat projections of 70 cents. About $334M of the company’s revenues, and $14M in operating income, came from Blockbuster, acquired in April 2011. Dish says it benefited from the sale of the rental chain’s inventory: It closed about 500 domestic stores in Q1, bringing the total down to about 1,000. Dish says it plans to close another 100 domestic Blockbuster stores in the current quarter and warns that its evaluation of the chain’s performance “could lead us to close additional Blockbuster retail stores.” CEO Joseph Clayton says he’s “encouraged by two quarters of net additions, as well as a reduction in churn.” Although the company provided no details about the launch in March of its ballyhooed Hopper multi-room DVR set top box, he says the market’s reception “was favorable and we think it will be a great platform for the future.”
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