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PRNewswire 12-Nov-2024 7:42 AM
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:
"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:
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 | For the Nine Months Ended | |||||||||
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 | ||||||||||
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 | Pay-TV | Retail Wireless | 5G Network | Broadband and | 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 | ||||||||||||||||||
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 | Pay-TV | Retail Wireless | 5G Network | Broadband and | 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 | ||||||||||||||||||
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 | 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 | 140 | |||||
Class B common stock, $0.001 par value, 800,000,000 shares authorized, | 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 | For the Nine Months | |||||||||||
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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SOURCE EchoStar Corporation