Dish Network said the devastating hurricane that ripped through Puerto Rico and the U.S. Virgin Islands in September led to its net loss of 129,000 TV subscribers third quarter of 2017.
Excluding the losses Puerto Rico and the USVI, Dish actually posted a small net gain of 16,000 pay-TV subs in the U.S., according to the company. In addition, its overall churn rate improved in Q3 — standing at 1.57% compared with 2.11% in Q3 2016.
Dish combines together both satellite and Sling TV over-the-top customers in reporting subscribers, forcing investors to guess at how much its core satellite biz is shrinking.
After Hurricane Maria swept through Puerto Rico and USVI, Dish said it “proactively paused” service for customers in those areas, representing a net loss of 145,000 TV subscribers for Q3. The company ended the period with 13.203 million pay-TV subs, a 3.2% decline (down 440,000) over the prior 12 months.
In Q3, Dish lost 223,000 satellite subs while netting 239,000 Sling TV customers, per estimates by Wall Street analyst firm MoffettNathanson. However, “Sling TV is economically irrelevant,” analyst Craig Moffett wrote in a research note. “It is doing nothing to arrest Dish Network’s slide.”
Overall, Dish slightly missed Wall Street’s earnings expectations for Q3. The company posted revenue of $3.58 billion, up 0.5% year over year, and net income of $297 million (down from $318 million in the year-ago quarter). Dish’s earnings per share of 57 cents missed analyst forecasts of 59 cents.
Dish said that it expects to incur expenses in connection with the reactivation of returning customers in Puerto Rico and USVI, and will therefore record any returning customers in those areas as gross new pay-TV subscriber activations for the period in which they return.
Notwithstanding Dish’s exposure to Hurricane Maria, cord-cutting and lower-cost over-the-top services continue taking their toll on traditional pay-TV players. Comcast, AT&T (which owns DirecTV) and Charter Communications each reported accelerating losses of video subscribers in Q3 — with AT&T shedding a record 385,000 DirecTV satellite and U-verse TV customers in the period.
Meanwhile, Dish’s dishNET broadband service declined during Q3. As of September 30, 2017, it had 459,000 broadband subs in the U.S., down 22.6% year over year.
Pictured above: Homes in Catano, Puerto Rico, on Sept. 28, one week after Hurricane Maria hit the island.