EchoStar Loses 314,000 Net Pay TV Subscribers in First Earnings Report Post-Merger

Charlie Ergen‘s EchoStar lost about 314,000 net pay TV subscribers in the fourth quarter, compared with a loss of 268,000 in the year-ago period and a decline of 64,000 in the third quarter of 2023.

The company disclosed late Thursday that it lost around 60,000 Sling TV subscribers in the latest quarter, ending 2023 with 2.06 million total Sling TV subs. “We lost approximately 279,000 net Sling TV subscribers during the year ended Dec. 31, 2023, compared to the loss of approximately 152,000 net Sling TV subscribers during the same period in 2022,” the company said in a regulatory filing. “The increase in net Sling TV subscriber losses were primarily related to lower Sling TV subscriber activations, partially offset by lower Sling TV subscriber disconnects in 2023.”

It also recorded a net decline of about 250,000 customers in its traditional Dish satellite TV business in the fourth quarter, ending 2023 with 6.47 million overall. “We lost approximately 945,000 net Dish TV subscribers during the year ended Dec. 31, 2023, compared to the loss of approximately 805,000 net Dish TV subscribers during the same period in 2022,” the firm explained. “This increase in net Dish TV subscriber losses primarily resulted from lower gross new Dish TV subscriber activations and a higher Dish TV churn rate.”

As a result, EchoStar’s total pay TV users as of the end of the year amounted to 8.53 million, compared with 8.84 million as of the end of September 2023.

EchoStar posted a fourth-quarter loss of $2.03 billion, a swing from a year-ago profit of $984 million. The net loss in the fourth quarter of 2023 was primarily attributable to a noncash impairment to goodwill totaling approximately $758 million, and an adjustment to the carrying value of the 800 MHz purchase option totaling approximately $1.6 billion,” EchoStar explained.

In a regulatory filing, the company warned that it “expects to use a substantial amount of cash” to make debt payments this year, including one worth $951 million in March.

The company, led by chairman Ergen and CEO Hamid Akhavan, was created by an all-stock merger of Ergen’s satellite TV and streaming service provider Dish Network with his broadband and communications provider EchoStar Corp. that closed at the start of the year.

Friday’s earnings report was the merged company’s first since the deal closed. Ergen has said the combination would help launch “a new era of connectivity,” adding: “We have brought together two trailblazing companies with complementary portfolios to create a global connectivity leader with premier wireless, satellite, and video distribution capabilities.”

Akhavan said Thursday: “With the close of the merger, we will continue to integrate our business and realize savings and operational efficiencies. We also will increase our focus on identifying and targeting the best, most profitable customers in each of our addressable market segments — pay-TV, retail wireless, and broadband and satellite services.”

Asked about Ergen’s level of involvement in the business — he was not on the earnings call Friday, which Akhavan said it was because it was his birthday and he had the day off — Akhavan said he has taken over the day-to-day operations, which has allowed Ergen to look at the bigger picture.

“That’s given the Charlie the ability to focus on more strategic and longer-term developments,” he said.