http://money.excite.com/ht/nw/bus/20041102/hle_bus-n022082.html
Tuesday November 2, 12:02 PM EST
NEW YORK (Reuters) - DirecTV Group Inc. (DTV) on Tuesday posted a large quarterly loss as marketing and subscriber retention costs rose sharply, offsetting a 49 percent rise in new subscribers.
The top U.S. satellite television operator, controlled by Rupert Murdoch's News Corp. Ltd. (NCP), reported a deeper third-quarter net loss of $1.0 billion, or 73 cents a share, including a $903 million after-tax impairment charge, a $204 million loss from an adjustment to the final selling price of a satellite operation, and a $624.3 million income tax benefit.
It posted a net loss of $23 million, or 2 cents a share, a year earlier.
The $903 million charge relates to an abandoned Spaceway project to offer Internet service over yet-to-be launched satellites. The three satellites, manufactured by Boeing Co. Inc. (BA), are expected to be used to expand the company's ability to offer high-definition video broadcasts.
Excluding items, DirecTV posted an operating loss of $1.55 billion, compared to an operating profit of $8 million a year earlier.
Revenue rose 20 percent to $2.86 billion, from $2.57 billion a year earlier.
Since News Corp. took control of DirecTV late last year, the El Segundo, California-based company has ramped up marketing and promotions to push deeper into cable service territories with devastating effect to its rivals.
In the third quarter, it added 484,000 net new subscribers, ending with 12.08 million subscribers. Monthly average revenue per user rose to $66.46 from $63.49 a year earlier.
But the gains came at a high cost. The rate at which customers left the service rose to 1.67 percent, from 1.60 percent in the year earlier period.
Subscriber acquisition costs rose by nearly 50 percent to $723.1 million in the quarter, and the cost to upgrade and retain customers more than doubled to $261.3 million.
Shares of DirecTV fell 22 cents to $16.80 in late morning trading on the New York Stock Exchange.
Tuesday November 2, 12:02 PM EST
NEW YORK (Reuters) - DirecTV Group Inc. (DTV) on Tuesday posted a large quarterly loss as marketing and subscriber retention costs rose sharply, offsetting a 49 percent rise in new subscribers.
The top U.S. satellite television operator, controlled by Rupert Murdoch's News Corp. Ltd. (NCP), reported a deeper third-quarter net loss of $1.0 billion, or 73 cents a share, including a $903 million after-tax impairment charge, a $204 million loss from an adjustment to the final selling price of a satellite operation, and a $624.3 million income tax benefit.
It posted a net loss of $23 million, or 2 cents a share, a year earlier.
The $903 million charge relates to an abandoned Spaceway project to offer Internet service over yet-to-be launched satellites. The three satellites, manufactured by Boeing Co. Inc. (BA), are expected to be used to expand the company's ability to offer high-definition video broadcasts.
Excluding items, DirecTV posted an operating loss of $1.55 billion, compared to an operating profit of $8 million a year earlier.
Revenue rose 20 percent to $2.86 billion, from $2.57 billion a year earlier.
Since News Corp. took control of DirecTV late last year, the El Segundo, California-based company has ramped up marketing and promotions to push deeper into cable service territories with devastating effect to its rivals.
In the third quarter, it added 484,000 net new subscribers, ending with 12.08 million subscribers. Monthly average revenue per user rose to $66.46 from $63.49 a year earlier.
But the gains came at a high cost. The rate at which customers left the service rose to 1.67 percent, from 1.60 percent in the year earlier period.
Subscriber acquisition costs rose by nearly 50 percent to $723.1 million in the quarter, and the cost to upgrade and retain customers more than doubled to $261.3 million.
Shares of DirecTV fell 22 cents to $16.80 in late morning trading on the New York Stock Exchange.
