EchoStar Corporation SATS reported a third-quarter 2024 non-GAAP loss of 52 cents per share compared with a loss of 51 cents in the prior-year quarter. The bottom line was wider than the Zacks Consensus Estimate of a loss of 28 cents by 85.7%.

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Revenues in the quarter totaled $3.9 billion, down 5% year over year. The top line missed the consensus mark by 1.5%. Net subscriber losses in Pay-TV and Broadband and satellite services led to the contraction. However, steady growth in Retail Wireless and 5G Network Deployment businesses is a tailwind.

In response to the results, SATS’ shares plummeted 12.9%, and the trading session closed at $22.76 on Nov. 12. Shares of the company have gained 133.7% compared to the sub-industry’s rise of 18.2% in the past year.

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Segmental Details

In the reported quarter, revenues from the Pay-TV segment were down 6.7% year over year to $2.62 billion. In the third quarter, SATS experienced a net decline of roughly 43,000 pay-TV subscribers, a notable improvement from the loss of 64,000 subscribers in the previous year’s quarter. A key factor in this improvement was the increase in SLING TV subscribers, which grew by 145,000, surpassing the 117,000 additions in the prior year quarter. 

EchoStar now has 8.03 million pay-TV subscribers, which includes 5.89 million DISH TV and 2.14 million SLING TV customers. The surge in SLING TV subscriptions and lower churn in DISH TV helped offset fewer new DISH TV activations.

Retail Wireless category ended the quarter with 6.98 million subscribers and reported $896 million in net sales, up 0.5% year over year. The segment saw a net decrease of nearly 297,000 subscribers in the third quarter compared with a decline of 225,000 in the year-ago period. The lower net subscriber losses were due to a reduction in churn rates. The segment was adversely impacted by net losses from government-subsidized subscribers, particularly due to the Affordable Connectivity Program funding closure on June 1, 2024. Excluding these losses, the company added approximately 62,000 Retail Wireless subscribers during the quarter.

EchoStar Corporation Price, Consensus and EPS Surprise

EchoStar Corporation price-consensus-eps-surprise-chart | EchoStar Corporation Quote

Revenues from Broadband and Satellite Services were $386.7 million compared with $413 million in the prior-year quarter. Subscribers declined by 43,000 in the third quarter, an improvement from the 59,000 loss reported in the prior-year period. The net loss reduction is attributed to the successful launch of the EchoStar XXIV (Jupiter 3) satellite, which enhanced service offerings and attracted new customers. However, the conclusion of the ACP program on June 1, 2024, hurt broadband satellite subscriber growth.

Net sales from 5G Network Deployment increased to $43.2 million from $29.9 million a year ago.

Other Details

Operating income before depreciation and amortization (OIBDA) was $316.7 million in the third quarter compared with $365.9 million in the year-ago quarter.
OIBDA for PayTV was $676 million compared with $675.6 million a year ago.

OIBDA for Broadband and Satellite Services was $77.5 million, down 31.4% year over year.

OIBDA loss for Retail Wireless was $90.8 million compared with a loss of $105.6 million in the prior-year period.

OIBDA loss for 5G Network Deployment was $330.7 million compared with a loss of $299.2 million a year ago.

Balance Sheet

As of Sept. 30, 2024, SATS had total cash and cash equivalents of $622.6 million compared with $419.2 million as of June 30, 2024.

For the nine months ended Sept. 2024, SATS generated $1.2 billion of cash from operating activities compared with $2.02 billion in the year-ago period.

SATS’ Zacks Rank

Currently, EchoStar carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Companies

Iridium Communications IRDM reported an EPS of 21 cents for the third quarter of 2024, beating the Zacks Consensus Estimate by 5%. The company incurred a loss of 1 cent per share in the prior year quarter. 

Shares of IRDM lost 16.1% in the past year.

Itron Inc ITRI reported non-GAAP EPS of $1.84 for third-quarter 2024, which beat the Zacks Consensus Estimate by 62.8%. The company reported earnings of 98 cents in the prior-year quarter.

Shares of ITRI surged 90.8% in the past year. 

Watts Water Technologies, Inc. WTS reported third-quarter 2024 adjusted EPS of $2.03 compared with $2.04 in the prior-year quarter. The bottom line topped the Zacks Consensus Estimate by 2%.

Shares of WTS have gained 10.4% in the past year. 

 

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