Feb. 21 (Bloomberg) -- Dish Network Corp., the second-largest U.S. satellite-television provider, reported fourth-quarter sales that missed analysts’ estimates as new subscriber growth remained sluggish.
Revenue rose 6.6 percent to $3.54 billion from the quarter a year ago, the Englewood, Colorado-based company said today in a regulatory filing. Analysts were projecting $3.59 billion on average, according to data compiled by Bloomberg. Net income was $288 million, up from $209 million in the period a year earlier.
Dish has been struggling to transform its business from a slow-growth satellite-TV provider into a more dynamic wireless carrier. Having acquired a large holding of U.S. airwaves, Dish Chairman Charlie Ergen has been able to almost double the company’s share price in the past two years even without providing a clear strategy to enter the mobile Internet and video streaming market.
“It’s all about their spectrum and their longer-term plans to monetize it somehow,” said Chris King, an analyst with Stifel Financial Corp. who recommends holding Dish shares. “That’s all that matters for them right now. They are not being valued solely on their operations any longer.”
Dish added 8,000 new pay-TV subscribers in the fourth quarter. Analysts estimated 21,000, according to a survey of eight estimates compiled by Bloomberg.
EchoStar Corp., the satellite-TV equipment manufacturer that also counts Charlie Ergen as its chairman, said today that it will receive five satellites from Dish. EchoStar, which split from Dish in 2008, also will get $11 million in cash in exchange for preferred tracking stock in Hughes Network Systems LLC, EchoStar’s broadband service division.
Dish shares rose 3.7 percent to $59.20 at 11:09 a.m. in New York. The stock is up 63 percent over the past year, as of yesterday’s close.
DirecTV, the largest U.S. satellite-TV provider, rose yesterday after the company announced a $3.5 billion stock buyback and beat analysts’ sales estimates for the fourth quarter. DirecTV gained 93,000 U.S. subscribers, and said it would, at a minimum, hold on to its market share in the country this year.
To contact the reporter on this story: Scott Moritz in New York at firstname.lastname@example.org
To contact the editor responsible for this story: Sarah Rabil at email@example.com