Dish Network reported losses of 116,000 subscribers in the third quarter, a jump compared to attrition of just 23,000 in the third quarter of 2015. Dish lost 281,000 subscribers in the second quarter and has now lost 420,000 through three quarters of fiscal 2016.
Dish mixes in customer growth for its virtual Sling TV platform with its traditional satellite metrics. Analysts fear that losses to the core platform have been somewhat shielded by the IP service’s growth. With emerging competition in the virtual-MVPD market — led by AT&T’s DirecTV Now — Moffett Nathanson analyst Craig Moffett speculates that attrition could get even worse in coming quarters.
“AT&T’s planned $35 DirecTV Now service appears poised to strike right at the heart of Sling TV, which has been the sole glimmer of growth in Dish’s core business,” Moffett said in a note to investors. “By our estimates, Dish lost 320K traditional satellite subscribers in Q3, and has lost 949K over the past year. Their legacy subscriber base has shrunk by 8.1 percent year over year! That decline has been at least partially offset by the growth of Sling TV, which has added an estimated 517K subscribers over the past four quarters, cutting Dish Network’s overall annual decline rate to 3.1%. In Q3, we estimate that they added another 204K.”
Dish’s revenue per user grew to $89.44 from $86.33, suggesting rate hikes for traditional satellite customers.
Dish reported third-quarter revenue of $3.75 billion, up narrowly from $3.73 billion in the third quarter of 2015. The company’s network income totaled $307 million, up from $196 million in the corresponding quarter.
Dish will hold its earnings call with investment analysts and media at 12 p.m. EST today.