Dish's Q1 disappoints; lowest sub adds in years
The satellite TV broadcaster Dish Network fell short of Wall Street expectations for the first quarter and shares slid to a three-week low Thursday.
Dish last month put in a $25.5 billion bid for cell carrier Sprint Nextel Corp., attempting to derail a competing bid from Japan's Softbank Corp and vault itself into the market for mobile entertainment.
Nomura analyst Mike McCormack said the earnings miss was driven by the higher cost of setting up new subscribers with set-top boxes. Dish introduced a new "Hopper" box this year that can send TV content to tablet computers.
The company earned $215.6 million, or 47 cents per share, for the period ended March 31. That was down 41 percent from $360.3 million, or 80 cents per share, a year earlier.
Revenue slipped 1 percent to $3.55 billion as rentals declined at the Blockbuster video-store chain, which Dish owns.
Analysts polled by FactSet expected earnings of 53 cents per share, and revenue of $3.62 billion.
Dish added 36,000 TV subscribers in its first quarter, the fewest since 2009 when the recession and a dismal housing market hammered consumers.
The first quarter is usually the strongest of the year, and analyst Christopher King at Stifel Nicolaus had expected 64,000 new subscribers. King said the weakness was not specific to Dish — the U.S. pay-TV industry is seeing an overall decline.
The number of Dish subscribers has declined slowly since 2010.
Dish began selling a faster satellite Internet service in September, resulting in a net 66,000 new broadband subscribers. It's using satellites from ViaSat and Hughes for the service. They also resell their services under other brands.
Shares of Dish Network Corp., based in Englewood, Colo., fell $1.11, or 2.8 percent, to $38.50, dipping as low as $38 at one point.