DirecTV Posts Q3 Profit

Nov 3, 2005  •  Post A Comment

Satellite operator DirecTV reported Thursday that it swung to a third-quarter profit, buoyed by strong subscriber gains and the company’s ongoing efforts to cut costs. However, the company continued to be dogged by a high rate of customer losses, known as churn.

The company reported a profit of $95 million, compared with red ink of just over $1 billion a year ago. Revenue rose 13 percent to $3.2 billion.

The results came as DirecTV had 1.1 million gross customer additions in the quarter. But those gains were partially offset by a churn rate of 1.9 percent, which the company blamed on disconnects of customers with lower credit rating scores who obtained service in 2004 and early 2005.

“Our No. 1 negative is churn,” said DirecTV CEO Chase Carey. “It is still high, but we are getting on top of it as we weed through high-credit-risk customers.”

DirecTV at the end of October had 15 million subscribers.