DirecTV dips on Q3
November 9, 2007
DirecTV’s third-quarter net income dropped 14 per cent as the company spent more to provide customers with high-definition channels and digital video recorders. The US's largest satellite-TV operator reported net income of $319 million (E217m), compared with $370.2 million a year earlier. Results in the year-ago quarter included a pretax gain of $61 million related to the merger of Sky Brazil and DirecTV’s Brazil operations.
Revenue rose 18 per cent to $4.32 billion on subscriber growth and an increase in the average revenue per subscriber. Operating costs surged 24 per cent, with programming-related and subscriber-acquisition costs both climbing 20 per cent.
The company said net US subscriber additions grew 45per cent to 240,000. DirecTV had 16.56 million subscribers as of September 30th, up 6per cent. Almost 40 per cent of subscribers have advanced services compared with less that 30 per cent a year ago.
Average monthly revenue per subscriber rose 8.3 per cent to $78.79 on higher prices for programming packages, higher fees for high-definition and DVR services and an additional week of NFL Sunday Ticket revenue in the current quarter compared with a year ago. Average subscriber acquisition cost went up 10 per cent to $696.
The monthly churn rate – the percentage of customers that left in the quarter – fell to 1.61 per cent from 1.8 per cent. The churn rate usually is higher in the third quarter because of seasonal trends.