ENGLEWOOD, Colo. - EchoStar Corporation (NASDAQ: SATS) reported a decline in revenue and a swing to loss in the first quarter of 2024, yet shares edged up slightly by 0.8% following the announcement.
The provider of satellite communication solutions posted a net loss of $107.38 million, or -$0.40 per share, compared to a net income of $253.53 million, or $0.82 per share, in the same quarter last year. The reported loss per share was notably below the analyst consensus estimate of -$0.24.
Revenue for the quarter was $4.01 billion, a decrease from $4.39 billion in the first quarter of the previous year, and slightly below the consensus estimate of $4.06 billion.
EchoStar's President and CEO, Hamid Akhavan, attributed the performance to strategic efforts in integrating EchoStar and DISH Network (NASDAQ:DISH) businesses, which led to increased Average Revenue Per User (ARPU) across all business units and improved customer satisfaction.
Despite the decline in net income and revenue, the company saw a smaller reduction in net Pay-TV subscribers, which fell by approximately 348,000 compared to a decrease of 552,000 in the year-ago quarter.
The company ended the quarter with 8.18 million Pay-TV subscribers, including 6.26 million DISH TV subscribers and 1.92 million SLING TV subscribers. The reduction in subscriber losses was primarily due to a lower churn rate and a focus on acquiring higher-quality subscribers.
The company's broadband segment also reported a decrease in net subscriber losses, attributed to the launch of the new EchoStar XXIV satellite service and increased demand for new satellite service plans. However, Retail Wireless net subscribers decreased by approximately 81,000, consistent with the year-ago quarter.
EchoStar's investments in 5G Network Deployment remained substantial, with purchases of property and equipment for the segment amounting to $549.17 million, a decrease from $871.04 million in the prior year.
In his statement, Akhavan highlighted the company's ongoing focus on addressing necessary financing, improving its position in Retail Wireless, expanding the wireless network, and maximizing profitability with the newly launched EchoStar XXIV/Jupiter™ 3 satellite.
The modest uptick in EchoStar's stock price post-earnings release suggests investors may have had tempered reactions to the company's financial performance and strategic initiatives. However, the company's efforts to improve operational efficiency and subscriber quality appear to be recognized in the market's response.
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