Dish loses 23K subscribers in Q3; analysts suspect Sling TV helped bolster satellite TV business

For the second consecutive quarter, analysts have accused Dish Network (NASDAQ: DISH) of masking significant subscriber losses in its core satellite TV business with customer growth in its Sling TV OTT unit.

Dish reported net pay-TV subscriber losses of 23,000 for the third quarter, compared to a decline of 5,000 in the same period of 2014. Dish's figure includes its customer additions for Sling TV, the streaming video service it launched back in February. But the company is not saying how much Sling is contributing to its bottom line in terms of customer growth.

Evercore ISI analyst Vijay Jayant believes the actual attrition to Dish's core satellite business is in the range of 90,000 to 140,000, which "is a bit higher than estimated."

Dish said it lost 81,000 subscribers in the second quarter -- a figure analysts said was also masked partly by Sling TV gains.

Dish's customer losses stand in opposition to the gains AT&T reported in its own satellite TV business. AT&T reported net U.S. subscriber growth in the third quarter of 26,000 for DirecTV, as the company shifted focus for video service sales to its new satellite TV acquisition.

Evercore said it expects the overall U.S. pay-TV industry to report 385,000 in customer losses in the third quarter, a figure that would stand as a dramatic improvement from customer losses in the second quarter. Indeed, some major players like Comcast and Charter Communications are predicting further improvements in the fourth quarter.

Dish reported a 1.3 percent increase in third quarter revenue to $3.73 billion, which was slightly lower than analysts' consensus forecasts. 

The company's net income grew by 34 percent year over year to $196 million.

Dish executives, including Chairman and CEO, will speak today to investors during the company's third-quarter earnings call.

For more:
- read this Dish Network earnings release

Special Report: From Comcast to AT&T to Dish: How pay-TV performed in Q3 2015

Related articles:
Major pay-TV operators down less than 150K video subs in Q3
Huge Q2 pay-TV customer losses not a 'cord-cutting inflection,' Evercore says
Comcast's X1 deployment accelerates to 40K boxes a day, reaches 25% of footprint
Dish reports 81K sub losses in Q2, but analyst says Sling TV gains are hiding much bigger attrition

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