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DISH Network (DISH) Q1 Earnings In Line, Revenues Down Y/Y

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DISH Network (DISH - Free Report) reported first-quarter 2019 earnings of 65 cents per share, in line with the Zacks Consensus Estimate but down 7.1% year over year.

Revenues declined 7.8% year over year to $3.187 billion. The top line also lagged the Zacks Consensus Estimate of $3.192 billion.

DISH exited the reported quarter with 9.639 million DISH TV and 2.424 million Sling TV subscribers. Total Pay-TV subscribers were 12.063 million.

Segment Details

Subscriber-related revenues (98.8% of revenues) declined 8% from the year-ago quarter to $3.148 billion.

Pay-TV video and related revenues fell 7.5% to $3.098 billion. Broadband revenues plunged 33.6% year over year to $49.8 million.


Pay-TV ARPU increased 0.6% year over year to $85.03 driven by DISH TV programming package price increases in the first quarter and a rise in revenue per subscriber related to Sling TV services.

Net Pay-TV subscribers declined approximately 259K. The number was much higher than 94K subscribers lost in the year-ago quarter. Moreover, churn rate was 1.74% in the reported quarter.

However, DISH added 7K net Sling TV subscribers.

Meanwhile, equipment sales and other revenues increased 10% to $39.4 million.

United States revenues declined 7.9% year over year to $3.176 billion. Canada and Mexico revenues increased 15% from the year-ago quarter to $10.9 million.

Operating Details

In the first quarter, subscriber-related expenses declined 8.2% year over year to $2 billion. As percentage of revenues, subscriber-related expenses decreased 300 basis points (bps) on a year-over-year basis to 62.9%.

Total subscriber acquisition costs (SACs) fell 1.1% from the year-ago quarter to $193.9 million. However, as percentage of revenues, SACs increased 400 bps to 6.1%. DISH TV SAC was $828, up 17.1% year over year.

EBITDA decreased 10.9% year over year to $597 million.

Operating income fell 13.8% year over year to $456.3 million. Operating margin contracted 100 bps to 14.3%.

Balance Sheet & Cash Flow

As of Mar 31, 2019, cash, cash equivalents and current marketable investment securities were $2.393 billion compared with $2.069 billion as of Dec 31, 2018.

DISH generated $732.9 million in cash flow from operating activities compared with $751.6 million in the year-ago quarter.

Zacks Rank and Stocks to Consider

DISH currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader consumer discretionary sector are Comcast (CMCSA - Free Report) , Electronic Arts (EA - Free Report) and IMAX Corporation (IMAX - Free Report) , sporting a Zacks #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth rate for Comcast, EA and IMAX is pegged at 12.8%, 16.5% and 17.5%, respectively.


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