DISH Network Corp. (DISH - Free Report) declared disappointing financial results for the third quarter of 2016 with the bottom and the top line missing the Zacks Consensus Estimate.
DISH Network currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The company faces intense competition in the pay-TV market from rival players like AT&T Inc. (T - Free Report) , Comcast Corporation (CMCSA - Free Report) and Charter Communications Inc. (CHTR - Free Report) .
Quarterly net income came in at $307.42 million or 64 cents per share compared with $196.48 million or 42 cents in the year-ago quarter. Earnings per share of 64 cents lagged the Zacks Consensus Estimate of 69 cents.
Total revenue in the reported quarter was approximately $3,746.1 million, up 0.35% year over year but below the Zacks Consensus Estimate of $3,755 million.
Segment-wise, subscriber-related revenues grossed $3,731.5 million in the third quarter, up 0.7% from the prior-year quarter. Equipment sales & other revenues totaled $14.6 million, down 50% from the prior-year quarter.
Third-quarter 2016 operating expenses were $3,249.8 million, down 1% year over year. Operating profit was $496.32 million compared with $441.72 million in the year-ago quarter. EBITDA at the end of the third quarter was $727.1 million versus $716 million in the year-ago quarter.
As of Sep 30, 2016, DISH Network had approximately 13.643 million pay-TV subscribers compared with 13.909 million at the end of the third quarter of 2015. The company lost 116,000 pay-TV subscribers in the reported quarter compared with a loss of 23,000 in the year-ago quarter.
Further, the company lost 30,000 broadband subscribers in the reported quarter versus a gain of 31,000 in the same quarter last year. At the end of the quarter under review, DISH Network had 593,000 broadband subscribers in comparison with 608,000 at the end of the prior-year quarter.
Pay-TV churn rate was 2.11% against 1.86% in the year-ago quarter. Pay-TV ARPU (average revenue per user) was $89.44 compared with $86.33 in the prior-year quarter. Pay-TV average subscriber acquisition cost was $682 against $722 in the year-ago quarter.
In the first nine months of 2016, DISH Network generated $2,152.4 million of cash from operations compared with $2,230.4 million in the prior-year period. Free cash flow in the reported period was $1,105.2 million, down from $1,436.7 million in the year-ago period.
At the end of the third quarter of 2016, DISH Network had $4,961 million of cash and marketable securities and $16,471 million of outstanding debt on its balance sheet compared with $1,611.1 million and $13,755.9 million, respectively, at the end of 2015.
"Zacks’ Best Private Investment Ideas
In addition to the recommendations that are available to the public on our website, how would you like to follow all Zacks' private buys and sells in real time?
Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Starting today, for the next month, you can have unrestricted access. Click here for Zacks' private trades >>"