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EchoStar Announces Financial Results for the Three and Nine Months Ended September 30, 2024

ENGLEWOOD, Colo., Nov. 12, 2024 /PRNewswire/ -- EchoStar Corporation (NASDAQ: SATS) announced its financial results for the three and nine months ended September 30, 2024.

Nine Months Ended September 30, 2024:

  • EchoStar reported total revenue of $11.86 billion for the nine months ended September 30, 2024, compared to $12.85 billion in the year ago period.
  • Net loss attributable to EchoStar in the first three quarters of 2024 was $454.78 million, compared to net income of $327.83 million in the year-ago period. Diluted loss per share was $1.67, compared to earnings per share of $1.06 in the year-ago period.
  • Consolidated OIBDA totaled $1.23 billion for the nine months ended September 30, 2024, compared to $1.69 billion in the year-ago period. (See OIBDA definition and non-GAAP reconciliation below.)

"The EchoStar team continued to execute against our plan in the third quarter. Our efforts focused on profitable customer acquisition and retention, strengthening our consumer offerings and enhancing our nationwide Open RAN 5G network," said Hamid Akhavan, president and CEO, EchoStar Corporation. "In addition, we recently announced a series of transformative transactions that will disrupt the wireless and pay-TV industries. We secured financing to meet our November debt maturity and announced an agreement with a group of our convertible note holders. This last transaction provides approximately $5.2 billion in additional financing and extends payment terms for the existing convertible notes tendered. In addition, we agreed to sell our pay-TV business to DIRECTV, subject to successful completion of an ongoing exchange and other closing conditions."

Three Months Ended September 30, 2024:

  • Net Pay-TV subscribers decreased approximately 43,000 in the third quarter, compared to a decrease of 64,000 in the year-ago quarter. Sling TV subscribers increased 145,000 in the third quarter, compared to a 117,000 increase in the year-ago quarter. The company closed the third quarter with 8.03 million Pay-TV subscribers including 5.89 million DISH TV subscribers and 2.14 million SLING TV subscribers. This decrease in net Pay-TV subscriber losses resulted from higher net SLING TV subscriber additions in the third quarter compared to the year-ago quarter and a lower DISH TV churn rate, offset by lower gross new DISH TV subscriber activations.
  • Retail Wireless subscribers, excluding Affordable Connectivity Program ("ACP") subscribers, increased approximately 62,000 in the third quarter. The company closed the third quarter with 6.98 million Retail Wireless subscribers. Retail Wireless net subscribers decreased by approximately 297,000 in the third quarter, compared to a decrease of 225,000 in the year-ago quarter. The increase in net retail wireless subscriber losses resulted from net losses of government subsidized subscribers, including ACP subscribers, compared to net additions in the year ago quarter, primarily due to the ACP program funding concluding on June 1, 2024. The third quarter was positively impacted by a lower retail wireless churn rate.
  • The company closed the third quarter with 912,000 Broadband Satellite subscribers, a decrease of approximately 43,000 in the quarter, compared to 59,000 in the year-ago quarter. The decrease in net Broadband Satellite subscriber losses was primarily due to the new EchoStar XXIV (Jupiter 3) satellite service launch and increased subscriber demand for our new satellite service plans. The third quarter was negatively impacted by the ACP program funding concluding on June 1, 2024.

Set forth below is a table highlighting certain of EchoStar's segment results for the three and nine months ended September 30, 2024 and 2023 (all U.S. GAAP amounts reference results from operations):

           
    

For the Three Months Ended
September 30,

 

For the Nine Months Ended
September 30,

     
    

2024

 

2023

 

2024

 

2023

    

(in thousands)

Revenue

         

Pay-TV

   

$     2,618,031

 

$    2,807,101

 

$     8,020,893

 

$    8,754,372

Retail Wireless

  

895,949

 

890,980

 

2,693,330

 

2,794,087

5G Network Deployment

 

43,227

 

29,916

 

108,245

 

67,902

Broadband and Satellite Services

386,709

 

413,073

 

1,163,306

 

1,305,779

All Other & Eliminations

 

(52,932)

 

(32,196)

 

(127,196)

 

(69,138)

Total

  

$     3,890,984

 

$    4,108,874

 

$   11,858,578

 

$  12,853,002

           

Net Income (loss) attributable to EchoStar

$      (141,812)

 

$     (138,371)

 

$      (454,779)

 

$       327,825

           

OIBDA

          

Pay-TV

   

$        676,003

 

$       675,565

 

$     2,184,514

 

$    2,271,638

Retail Wireless

  

(90,755)

 

(105,617)

 

(174,268)

 

(130,275)

5G Network Deployment

 

(330,737)

 

(299,146)

 

(977,319)

 

(813,597)

Broadband and Satellite Services

77,526

 

112,957

 

239,205

 

393,339

All Other & Eliminations

 

(15,370)

 

(17,897)

 

(43,153)

 

(31,289)

Total

  

$        316,667

 

$       365,862

 

$     1,228,979

 

$    1,689,816

           

Purchases of property and equipment, net of refunds, (including capitalized
interest related to regulatory authorizations)

    

Pay-TV

   

$         53,357

 

$        64,331

 

$        165,275

 

$       167,524

5G Network Deployment

 

396,596

 

852,169

 

1,506,237

 

2,907,102

Broadband and Satellite Services

44,913

 

79,164

 

172,083

 

172,251

Total

  

$        494,866

 

$       995,664

 

$     1,843,595

 

$    3,246,877

Reconciliation of GAAP to Non-GAAP Measurement:

For the Three Months 
Ended September 30, 2024

 

Pay-TV

 

Retail Wireless

 

5G Network
Deployment

 

Broadband and
Satellite Services

   

Consolidated 

Eliminations

  

(In thousands)

Segment operating income (loss)

 

$

588,501

 

$

(113,792)

 

$

(600,270)

 

$

(36,116)

 

$

910

 

$

(160,767)

Depreciation and amortization

  

87,502

  

23,037

  

269,533

  

113,642

  

(16,280)

  

477,434

OIBDA

 

$

676,003

 

$

(90,755)

 

$

(330,737)

 

$

77,526

 

$

(15,370)

 

$

316,667

                   

For the Three Months 
Ended September 30, 2023

            
 
   

Segment operating income (loss)

 

$

589,465

 

$

(168,166)

 

$

(463,105)

 

$

9,991

 

$

466

 

$

(31,349)

Depreciation and amortization

  

86,100

  

62,549

  

163,959

  

102,966

  

(18,363)

  

397,211

OIBDA

 

$

675,565

 

$

(105,617)

 

$

(299,146)

 

$

112,957

 

$

(17,897)

 

$

365,862

                   

For the Nine Months Ended 
September 30, 2024

 

Pay-TV

 

Retail Wireless

 

5G Network
Deployment

 

Broadband and
Satellite Services

   

Consolidated 

Eliminations

  

(In thousands)

Segment operating income (loss)

 

$

1,926,361

 

$

(309,571)

 

$

(1,749,961)

 

$

(110,256)

 

$

2,047

 

$

(241,380)

Depreciation and amortization

  

258,153

  

135,303

  

772,642

  

349,461

  

(45,200)

  

1,470,359

OIBDA

 

$

2,184,514

 

$

(174,268)

 

$

(977,319)

 

$

239,205

 

$

(43,153)

 

$

1,228,979

                   

For the Nine Months Ended
September 30, 2023

            
 
   

Segment operating income (loss)

 

$

1,985,490

 

$

(298,872)

 

$

(1,198,667)

 

$

81,543

 

$

4,724

 

$

574,218

Depreciation and amortization

  

286,148

  

168,597

  

385,070

  

311,796

  

(36,013)

  

1,115,598

OIBDA

 

$

2,271,638

 

$

(130,275)

 

$

(813,597)

 

$

393,339

 

$

(31,289)

 

$

1,689,816

Note on Use of Non-GAAP Financial Measures

OIBDA is defined as "Operating income (loss)" plus "Depreciation and amortization."

OIBDA, which is presented by segment above, is a non-GAAP measure reconciled to "Operating income (loss)" and does not purport to be an alternative to operating income (loss) as a measure of operating performance. We believe this measure is useful to management, investors and other users of our financial information in evaluating operating profitability of our business segments on a more variable cost basis as it excludes the depreciation and amortization expenses related primarily to capital expenditures and acquisitions for those business segments, as well as in evaluating operating performance in relation to our competitors.

The condensed consolidated financial statements of EchoStar for the period ended September 30, 2024, are attached to this press release. Detailed financial data and other information are available in EchoStar's Form 10-Q for the period ended September 30, 2024, filed today with the Securities and Exchange Commission.

EchoStar will host a conference call to discuss its earnings on Tuesday, November 12, 2024, at 11 a.m. Eastern Time. The conference call will be broadcast live in listen-only mode on EchoStar's investor relations website at ir.echostar.com. To attend the call, please dial: (877) 484-6065 (U.S.) and (201) 689-8846. When prompted on dial-in, please utilize the conference ID (13750022) or ask for the "EchoStar Corporation Q3 2024 Earnings Conference Call." Please dial in at least 10 minutes before the call to ensure timely participation.

About EchoStar Corporation

EchoStar Corporation (Nasdaq: SATS) is a premier provider of technology, networking services, television entertainment and connectivity, offering consumer, enterprise, operator and government solutions worldwide under its EchoStar®, Boost Mobile®, Sling TV, DISH TV, Hughes®, HughesNet®, HughesON™, and JUPITER™ brands. In Europe, EchoStar operates under its EchoStar Mobile Limited subsidiary and in Australia, the company operates as EchoStar Global Australia. For more information, visit www.echostar.com and follow EchoStar on X (Twitter) and LinkedIn.

Safe Harbor Statement under the US Private Securities Litigation Reform Act of 1995

This press release may contain statements that are forward looking, as that term is defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management's beliefs, as well as assumptions made by, and information currently available to, management. When used in this release, the words "believe," "anticipate," "goal," "seek," "estimate," "expect," "intend," "project," "continue," "future," "will," "would," "can," "may," "plans," and similar expressions and the use of future dates are intended to identify forward–looking statements. Although management believes that the expectations reflected in these forward–looking statements are reasonable, it can give no assurance that these expectations will prove to have been correct. You are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date made. We assume no responsibility for the accuracy of forward-looking statements or information or for updating forward-looking information or statements. These statements are subject to certain risks, uncertainties, and assumptions. See "Risk Factors" in EchoStar's Annual Report on Form 10-K for the period ended December 31, 2023, and subsequent quarterly reports on Form 10-Q as filed with the Securities and Exchange Commission and in the other documents EchoStar files with the Securities and Exchange Commission from time to time.

   

ECHOSTAR CORPORATION

   

CONDENSED CONSOLIDATED BALANCE SHEETS

   

(Dollars in thousands, except share amounts)

   

(Unaudited)

       
  

As of  

  

 September 30, 

 

December 31,

  

2024

 

2023

Assets

      

Current Assets:

    

Cash and cash equivalents

 

$

622,608

 

$

1,821,376

Current restricted cash and cash equivalents

  

2,047,489

  

Marketable investment securities

  

51,792

  

623,044

Trade accounts receivable, net of allowance for credit losses of $82,427 and
$74,390, respectively

  

1,099,545

  

1,122,139

Inventory

  

441,683

  

665,169

Prepaids and other assets

  

649,802

  

644,005

Other current assets

  

87,458

  

16,081

Total current assets

  

5,000,377

  

4,891,814

       

Noncurrent Assets:

      

Restricted cash, cash equivalents and marketable investment securities 

  

156,323

  

118,065

Property and equipment, net 

  

9,287,726

  

9,561,834

Regulatory authorizations, net

  

39,156,029

  

38,572,980

Other investments, net

  

216,139

  

314,370

Operating lease assets

  

3,158,548

  

3,065,448

Intangible assets, net 

  

79,078

  

172,892

Other noncurrent assets, net

  

493,157

  

411,491

Total noncurrent assets

  

52,547,000

  

52,217,080

Total assets

 

$

57,547,377

 

$

57,108,894

       

Liabilities and Stockholders' Equity (Deficit)

      

Current Liabilities:

      

Trade accounts payable

 

$

707,476

 

$

774,011

Deferred revenue and other

  

645,719

  

754,658

Accrued programming

  

1,499,375

  

1,427,762

Accrued interest

  

406,619

  

297,678

Other accrued expenses and liabilities

  

1,699,434

  

1,717,826

Current portion of debt, finance lease and other obligations

  

2,520,297

  

3,046,654

Total current liabilities

  

7,478,920

  

8,018,589

       

Long-Term Obligations, Net of Current Portion:

      

Long-term debt, finance lease and other obligations, net of current portion

21,557,251

  

19,717,266

 

Deferred tax liabilities, net

  

4,926,162

  

5,014,309

Operating lease liabilities 

  

3,125,819

  

3,121,307

Long-term deferred revenue and other long-term liabilities

  

958,931

  

849,131

Total long-term obligations, net of current portion

  

30,568,163

  

28,702,013

Total liabilities

  

38,047,083

  

36,720,602

       

Commitments and Contingencies

      
       

Redeemable noncontrolling interests

  

  

438,382

       

Stockholders' Equity (Deficit): 

      

Class A common stock, $0.001 par value, 1,600,000,000 shares authorized,
140,480,742 and 140,153,020 shares issued and outstanding, respectively

  

140

  

140

Class B common stock, $0.001 par value, 800,000,000 shares authorized,
131,348,468 shares issued and outstanding

  

131

  

131

Additional paid-in capital

  

8,337,211

  

8,301,979

Accumulated other comprehensive income (loss)

  

(177,764)

  

(160,056)

Accumulated earnings (deficit)

  

11,283,204

  

11,737,983

Total EchoStar stockholders' equity (deficit)

  

19,442,922

  

19,880,177

Noncontrolling interests

  

57,372

  

69,733

Total stockholders' equity (deficit)

  

19,500,294

  

19,949,910

Total liabilities and stockholders' equity (deficit)

 

$

57,547,377

 

$

57,108,894

  

ECHOSTAR CORPORATION

  

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS 

  

(Dollars in thousands, except per share amounts)

  

(Unaudited)

             
  

For the Three Months
Ended September 30, 

 

For the Nine Months
Ended September 30, 

  

2024

 

2023

 

2024

 

2023

Revenue:

            

Service revenue

 

$

3,671,674

 

$

3,942,308

 

$

11,233,429

 

$

12,211,542

Equipment sales and other revenue

  

219,310

  

166,566

  

625,149

  

641,460

Total revenue

  

3,890,984

  

4,108,874

  

11,858,578

  

12,853,002

             

Costs and Expenses (exclusive of depreciation and amortization):

            

Cost of services

  

2,538,149

  

2,368,621

  

7,602,809

  

7,222,761

Cost of sales - equipment and other 

  

393,024

  

612,378

  

1,164,200

  

1,715,936

Selling, general and administrative expenses

  

643,144

  

762,013

  

1,862,590

  

2,221,347

Depreciation and amortization 

  

477,434

  

397,211

  

1,470,359

  

1,115,598

Impairment of long-lived assets and goodwill

  

  

  

  

3,142

Total costs and expenses

  

4,051,751

  

4,140,223

  

12,099,958

  

12,278,784

             

Operating income (loss)

  

(160,767)

  

(31,349)

  

(241,380)

  

574,218

             

Other Income (Expense):

            

Interest income, net

  

11,200

  

43,915

  

55,591

  

166,409

Interest expense, net of amounts capitalized

  

(81,503)

  

(21,795)

  

(262,077)

  

(63,476)

Other, net

  

52,107

  

(168,947)

  

(65,501)

  

(169,640)

Total other income (expense)

  

(18,196)

  

(146,827)

  

(271,987)

  

(66,707)

             

Income (loss) before income taxes

  

(178,963)

  

(178,176)

  

(513,367)

  

507,511

Income tax (provision) benefit, net

  

35,162

  

59,439

  

53,733

  

(120,711)

Net income (loss)

  

(143,801)

  

(118,737)

  

(459,634)

  

386,800

Less: Net income (loss) attributable to noncontrolling interests, net of tax

  

(1,989)

  

19,634

  

(4,855)

  

58,975

Net income (loss) attributable to EchoStar

 

$

(141,812)

 

$

(138,371)

 

$

(454,779)

 

$

327,825

             

Weighted-average common shares outstanding - Class A and B common stock: 

            

Basic

  

271,736

  

271,245

  

271,616

  

270,637

Diluted

  

271,736

  

271,245

  

271,616

  

308,259

             

Earnings per share - Class A and B common stock:

            

Basic net income (loss) per share attributable to EchoStar

 

$

(0.52)

 

$

(0.51)

 

$

(1.67)

 

$

1.21

Diluted net income (loss) per share attributable to EchoStar

 

$

(0.52)

 

$

(0.51)

 

$

(1.67)

 

$

1.06

   

ECHOSTAR CORPORATION

   

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

   

(In thousands) 

   

(Unaudited)

       
  

For the Nine Months Ended September 30, 

  

2024

 

2023

Cash Flows From Operating Activities:

      

Net income (loss)

 

$

(459,634)

 

$

386,800

Adjustments to reconcile net income (loss) to net cash flows from operating activities:

      

Depreciation and amortization

  

1,470,359

  

1,115,598

Impairment of long-lived assets and goodwill

  

  

3,142

Realized and unrealized losses (gains) on investments, impairments and other

  

41,929

  

(24,866)

Realized and unrealized losses (gains) on derivatives

  

  

192,107

Liberty Puerto Rico Asset Sale losses (gains)

  

(50,418)

  

Non-cash, stock-based compensation

  

28,298

  

37,729

Deferred tax expense (benefit)

  

(85,300)

  

103,614

Equity in (earnings) losses of affiliates

  

74,459

  

6,671

Changes in allowance for credit losses

  

8,037

  

8,638

Change in long-term deferred revenue and other long-term liabilities

  

15,996

  

9,122

Other, net

  

137,700

  

80,665

Changes in current assets and current liabilities, net

  

25,718

  

102,330

Net cash flows from operating activities

  

1,207,144

  

2,021,550

       

Cash Flows From Investing Activities:

      

Purchases of marketable investment securities

  

(29,166)

  

(2,384,614)

Sales and maturities of marketable investment securities

  

563,421

  

3,092,693

Purchases of property and equipment

  

(1,200,606)

  

(2,533,745)

Refunds and other receipts of purchases of property and equipment

  

  

34,611

Capitalized interest related to regulatory authorizations

  

(642,989)

  

(747,743)

Proceeds from other debt investments

  

  

148,448

Purchases of regulatory authorizations, including deposits 

  

(1,104)

  

(1,802)

Sale of assets to CONX

  

26,719

  

Liberty Puerto Rico Asset Sale

  

95,435

  

Other, net

  

10,892

  

(17,258)

Net cash flows from investing activities

  

(1,177,398)

  

(2,409,410)

       

Cash Flows From Financing Activities:

      

Repayment of long-term debt, finance lease and other obligations

  

(101,197)

  

(98,933)

Redemption and repurchases of convertible and senior notes

  

(951,170)

  

(1,634,084)

Proceeds from issuance of senior notes

  

  

1,500,000

Debt issuance costs and debt (discount) premium

  

  

21,635

Proceeds from New DISH DBS Financing

  

2,500,000

  

Debt issuance costs and debt (discount) premium from New DISH DBS Financing

  

(136,208)

  

Early debt extinguishment gains (losses) of convertible and senior notes

  

  

72,566

Net proceeds from Class A common stock options exercised and stock issued under the Employee Stock Purchase Plan

  

4,347

  

11,570

Purchase of SNR Management's ownership interest in SNR HoldCo

  

(441,998)

  

Other, net

  

(4,185)

  

(5,997)

Net cash flows from financing activities 

  

869,589

  

(133,243)

       

Effect of exchange rates on cash and cash equivalents

  

(3,458)

  

1,622

       

Net increase (decrease) in cash, cash equivalents, restricted cash and cash equivalents

  

895,877

  

(519,481)

Cash, cash equivalents, restricted cash and cash equivalents, beginning of period

  

1,911,601

  

2,561,803

Cash, cash equivalents, restricted cash and cash equivalents, end of period

 

$

2,807,478

 

$

2,042,322

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