Churn proved to be a small bright spot for Dish Network during a second quarter in which the company lost both subscribers and revenue.
Dish said net income of $40 million in the period was down from $424 million in the year-ago quarter thanks to litigation expenses of $280 million. Pay TV average revenue per user (ARPU) was also down to $87.25 from $89.98 the year prior, thanks in part to an influx of Sling TV subscribers.
The company said gross Pay TV adds totaled 444,000, but Dish came away from the quarter with a net loss of 196,000 pay TV customers. That number was better than expectations of 256,000 losses, though, and marked an improvement from 281,000 net losses in the second quarter 2016.
A bright spot for Dish, though, was churn, which showed strong improvement in the quarter. That metric dropped from 1.96 percent last year to 1.59 percent in the most recent period.
But that point isn’t enough to sustain a business.
MoffettNathanson analysts observed that Dish’s traditional satellite TV business appears to be shrinking at a pace of 9.1 percent, while service revenues are dropping 5.5 percent each year.
“Time is running out for Dish’s core business,” they wrote. “Shrinking gross additions in order to sustain EBITDA works for a little while…but only a little while. Eventually, the accumulated damage to the core business is greater than the short term benefit from shrinking gross additions.”
Jeffries Analyst Mike McCormack said he expects Dish will remain focused on its wireless strategy, with “industry structure and IoT build plans highlighted.”
