Q2-16: DISH Network reports 27% profit hike, loses 281K pay-TV subscribers
BENGALURU: DISH Network Corp. (DISH) reported 26.52 percent increase in its net profit for the quarter ended 30 June 2016 (Q2-16, current quarter) at $ 410.46 million as compared to $ 324.42 million in the corresponding year ago quarter. Despite activating approximately 527,000 gross new pay-TV subscribers, net pay-TV subscribers declined approximately 281,000 in Q2-16. Comparatively, in Q2-15 approximately 638,000 gross new pay-TV subscribers were added with a net loss of approximately 81,000 pay-TV subscribers.
DISH reported almost flat revenue (grew by 0.12 percent) in the current quarter of $ 3,837.04 million as compared to revenue of $ 3,832.29 million in Q2-15. Subscriber related revenue in Q2-16 grew 0.7 percent to $3,826.22 million as compared to $3,801.42 million in Q2-15.
EBIDTA in Q2-16 declined slightly (2.7 percent) to $ 899.54 million from $ 924.45 million in the corresponding year ago quarter.
Subscribers, ARPU, SAC
The company closed Q2-16 with 13.593 million pay-TV subscribers, compared to 13.932 million pay-TV subscribers at the end Q2-2015.
DISH lost approximately 15,000 net broadband subscribers in the second quarter, bringing its broadband subscriber base to approximately 613,000.
Pay-TV ARPU for Q2-16 totalled $89.98, compared to Q2-2015 pay-TV ARPU of $ 87.91. Pay-TV subscriber churn rate in the current quarter was higher at 1.96 percent versus 1.71 percent for Q2-2015.
Pay-TV subscriber acquisition cost (SAC) in Q2-16 was $353.08 million as compared to $ 405.70 million in Q2-15. Pay-TV SAC was $782 per subscriber during Q2-16 compared to $767 during Q2-15 an increase of $15 or 1.9 percent.
DISH says that this change was primarily attributable to an increase in advertising costs per activation, partially offset by a decrease in hardware costs per activation. The decrease in hardware costs per activation was primarily due to a higher percentage of remanufactured receivers being activated on new DISH branded pay-TV subscriber accounts and by a reduction in manufacturing costs related to certain receiver systems. This decrease was partially offset by an increase in the percentage of new DISH branded pay-TV subscriber activations with Hopper 3 receiver systems, which have a higher cost per unit than the prior generation Hopper receiver systems.
It may be noted that DISH includes all of its Sling TV subscribers in the company’s total pay-TV metrics, including in the pay-TV subscriber, pay-TV ARPU and pay-TV churn rate numbers set forth below. Sling TV subscribers are reported net of disconnects in DISH’s gross new pay-TV subscriber activations. The Sling branded pay-TV services consist of, among other things, live, linear streaming over-the-top (OTT) internet-based domestic, international and Latino video programming services.
DISH markets broadband services under the dishNET™ brand in the United States. In addition to the dishNET branded satellite broadband service, DISH also offers wireline voice and broadband services under the dishNET brand as a competitive local exchange carrier primarily to consumers living in a 14-state region in the western United States. It primarily bundles dishNET branded services with its DISH branded pay-TV service.
During Q1-2016 DISH made its next generation Hopper, the Hopper 3, availableto customers nationwide. Among other things, the Hopper 3 features 16 tuners, delivers an enhanced 4K Ultra HD experience, and supports up to seven TVs simultaneously says the company.