DirecTV Second-Quarter U.S. Sub Gains Weaken

NEW YORK - Satellite TV giant DirecTV reported improved second-quarter revenue and profit on Thursday, but its U.S. subscriber growth weakened in the traditionally slower period as the company cited economic weakness and heated competition. DirecTV's stock dropped in early trading. As of 10am ET, it was down 6.3 percent at $46.35. DirecTV's quarterly profit rose 20 percent to $701 million, and revenue grew 13 percent to $6.6 billion. DirecTV once again added subscribers in the U.S. and Latin America, but its 26,000 U.S. customer additions - to end June at 19.43 million U.S. users - compared with 100,000 in the year-ago period. Wunderlich Securities analyst Matthew Harrigan had predicted 68,000 net additions, and the Wall Street consensus estimate stood at 57,000. In its fast-growing Latin American unit, DirecTV added 472,000 net new customers. The NFL labor dispute stretched throughout the quarter, and DirecTV has the exclusive rights for the NFL Sunday Ticket program package, which could have affected U.S. user trends. Chairman and CEO Mike White cited "a challenging economic and competitive landscape" that "continues to impact DirecTV U.S." In the U.S., average revenue per user increased 3 percent to $90.58 driven by price increases on programming packages and leased set-top boxes, as well as higher advanced service fees. Those were partially offset by more promotional offers, according to the company. "Net additions declined to 26,000 as the increase in gross additions was more than offset by a higher average monthly churn rate of 1.59 percent principally resulting from a more competitive environment coupled with ongoing economic weakness," DirecTV said. Email: Georg.Szalai@thr.com Twitter: @georgszalai Related Topics