DirecTV's profit trails estimates after Latin America slowdown
DirecTV, the largest U.S. satellite- television provider, reported third-quarter profit that trailed estimates after Latin American subscriber additions failed to meet analyst projections.
Net income attributable to DirecTV rose to $565 million, or 90 cents a share, from $516 million, or 70 cents, a year earlier, the El Segundo, California-based company said today in a statement. Analysts had estimated 92 cents on average, according to data compiled by Bloomberg. Sales rose 8.4 percent to $7.4 billion, in line with the average analyst estimate.
DirecTV added 543,000 net subscribers in Latin America, fewer than the 585,000 estimate from nine analysts surveyed by Bloomberg. The disappointing results may indicate a deterioration in the regions economies, especially Venezuela, said Chris Marangi, a portfolio manager at Gamco Investors Inc. whose funds own 7.4 million DirecTV shares.
Latin American customer additions fell from 645,000 in the quarter ended in June. Last year, DirecTV reported 574,000 new Latin American users in the third quarter, an increase from the prior three-month period.
DirecTV added 67,000 net U.S. customers, less than the 99,000 average analyst estimate. The company has tried to entice subscribers with National Football League Sunday Ticket promotions, which give new customers access to all Sunday football games for free for a year. DirecTV also lowered the price for Sunday Ticket for current customers.
DirecTV shares rose less than 1 percent to $50.66 yesterday in New York, before the results were released. The stock has gained 18 percent this year.