By Chelsey Dulaney
Dish Network Corp. on Monday reported higher earnings and
revenue in the fourth quarter, but the company lost subscribers and
had a higher churn due to not having 21st Century Fox
programming.
Dish also said Chief Executive Joe Clayton will retire at the
end of March and will be succeeded by Chairman Charlie Ergen, who
will take the helm as the satellite-TV company is pushing to
diversify into new lines of business.
Dish said it saw lower pay-TV subscriber activations and
additions in the latest quarter and had a higher pay-TV churn rate
as Fox entertainment and news channels weren't available on its
service.
In the latest quarter, Dish lost a net 63,000 pay-TV
subscribers, compared with an addition of 8,000 net pay-TV
subscribers a year ago. Gross pay-TV additions were 615,000,
compared with 654,000 a year earlier.
Pay-TV subscriber churn rate, or the rate at which people
terminated service, was 1.61%, compared with 1.53% a year
earlier.
The company's satellite broadband customer growth slowed to
24,000 net subscriber additions in the quarter from 51,000
additions in the previous year's quarter.
Dish has struggled to boost its subscriber numbers amid what
executives have said is a negative pay-TV industry, pressured by a
weak economy and heavy promotions from competitors.
The company has also acknowledged that subscriber growth has
been impacted by quality of service issues, including not meeting
its own standards for installations, answering subscriber calls in
an acceptable time frame, and improving the reliability of some of
its equipment.
In part to offset losses, Dish rolled out a new online
video-streaming service called Sling TV in the U.S. earlier this
month. The service features a slimmed down subset of channels,
culminating a three-year effort to create an inexpensive streaming
TV service to reach a younger generation of viewers.
For the quarter ended Dec. 31, Dish posted a profit of $409.9
million, or 88 cents a share, compared with a year-earlier profit
of $283.2 million, or 63 cents a share.
Revenue grew 4% to $3.68 billion.
Analysts polled by Thomson Reuters had projected earnings of 43
cents a share and revenue of $3.7 billion.
Dish has come under scrutiny in recent weeks over its bidding in
the record U.S. sale of wireless licenses last month.
The company won a surprisingly large number of wireless licenses
in a recent government auction, but is facing criticism from major
wireless carriers and some government officials for setting up
bidding vehicles in a way that allowed it to secure $3.3 billion in
discounts intended for small businesses.
Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com
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