DirecTV Posts Buoyant Earnings

Satellite-TV operator adds 129,000 subscribers, unlike rival Dish Network.

By Robert Marich -- Broadcasting & Cable, 8/7/2008 12:05:00 PM

DirecTV Group reported robust second-quarter earnings Thursday that slightly exceeded stock-analyst forecasts, as its Latin American business was particularly robust.

Its U.S. operation also did well with a 5% net gain in subscribers compared with the same quarter a year earlier.

Second-quarter net profit rose to $455 million, or 40 cents per share, versus $448 million (37 cents) a year ago. Corporate revenue at the satellite-TV giant based in the Los Angeles area spurted 16% to $4.81 billion.

“DirecTV U.S. revenues were up 13% to $4.2 billion driven by solid subscriber growth -- due in large part to the lowest second-quarter monthly churn rate in four years of 1.49% -- as well as a 7% increase in ARPU [average revenue per unit],” DirecTV president and CEO Chase Carey said in a statement. “Much of our success in adding new subscribers, reducing churn and increasing household revenue can be attributed to the significant increase in subscribers with HD and/or DVR [digital-video-recorder] services over the past year.”

DirecTV finished the quarter with 17.16 million U.S. subscribers. “The 129,000 net adds were ahead of expectations of 110,000 due to lower churn,” said a research note from Morgan Stanley about U.S. performance.

DirecTV increasing subscribers stands in contrast to satellite rival Dish Network, which incurred a 25,000-net-subscriber loss in the same period.