Taken as a whole, the third-quarter results DISH Networks (NASDAQ: DISH) released Wednesday were not bad, though its earnings per share of $0.64 — good for a 52% improvement compared to last year — fell a bit short of pundits’ recently lowered expectations of $0.67. Revenue of $3.75 billion was flat and in line with consensus estimates for the quarter and, including its streaming TV service Sling, DISH added 736,000 new paying subscribers.
The not-so-good news is those new subscribers coming aboard DISH last quarter were fewer than the 751,000 it attracted in Q3 2015. And the news gets worse. A year ago, DISH reported a quarterly loss of 23,000 paying customers. That number soared about 400% last quarter, with 116,000 DISH subscribers heading for the exits.
To make matters worse, the recent six-figure subscriber loss was a drop in the bucket compared to the 281,000 it lost just a quarter ago. Many pundits blame the cord-cutting trend for DISH’s woes. There’s likely something to that theory, in that cord-cutting has been a growing trend for some time now as the number of streaming alternatives has increased — among them, its own Sling TV service.
According to one study, 2015 saw the most cord-cutting ever, with an estimated 4.9 million U.S. households opting to not pay for TV, and that figure is expected to grow even further this year and beyond. That said, shareholders have brushed aside the customer losses, trading DISH stock up 2.2% by mid-afternoon Wednesday.
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Tim Brugger has no position in any stocks mentioned.
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