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Leasing boxes, subs pump DirecTV

Company's quarterly earnings more than double

DirecTV, the nation’s largest satcaster — and soon to be the property of John Malone — said quarterly earnings more than doubled as it added subscribers and switched to leasing set-top boxes instead of selling them.

Net profit jumped to $365 million from $121 million. Revenue rose 16% to $4.18 billion.

It was a shot of good news from a sector that’s been overshadowed by cable and the mighty triple play.

In fact, investors applauded, driving DirecTV shares higher. They closed at $$25.30, up 5.5%.

The El Segundo, Calif., company said it added 275,000 subs to end the fourth quarter with about 16 million.

DirecTV has been focused aggressively on dumping deadbeat customers, who had slowed subscriber growth, but is also increasing revenue per subscriber. CEO Chase Carey predicted that average revenue per sub should rise 5% in 2007.

Monthly churn rate — how many customers defect — fell to 1.57% during the quarter from 1.7% a year ago.

And a move to lease set-top boxes is helping DirecTV’s numbers. It delays recognition of the equipment as an expense by spreading it over years and lets the company reuse the boxes.

DirecTV said it’s on track to offer 100 high-definition channels by year’s end. A second satellite will boost that to 150 high-def channels, including more local channels, next year.

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