Strong subscriber numbers from DirecTV
Posted
May 07 2009, 11:27 AM
by
Kim Peterson
Rating:
DirecTV (DTV) quarterly profit drops 46%? Big deal.
The real number to look at is net subscriber additions, which rose 67% in the U.S. to 460,000. That's the sharpest rise in four years. The company spent a pretty penny on promotions and signup deals, which resulted in a wave of new customers -- and a drop in profit.
Revenue was up 7%, while the percentage of customer turnover in the U.S. dropped to 1.33% -- a 10-year low. That's in part because DirecTV has gone after higher-quality subscribers that can better afford its services.
DTV shares are down more than 1% in midday trading, but I think investors should be encouraged by the surprisingly high subscriber numbers and the low churn.
The satellite TV company now has about 18 million subscribers.
Analysts say DirecTV was well-tuned to the upcoming digital TV transition, taking advantage of the switch to lure in new subscribers. The company also pounced upon weaknesses at rival Dish Network (DISH).
Related reading:
DirecTV loves TiVo again
DirecTV finally offering video on demand
DirecTV weeds out customers
Has DISH lost its mojo?
