EchoStar Corporation (NASDAQ:SATS) shares edged up 1.98% in premarket trading Thursday, after the telecom group posted third-quarter revenue below expectations but highlighted progress in its ongoing transformation following recent multi-billion-dollar spectrum deals.
Revenue for the quarter came in at $3.61 billion, missing the $3.73 billion analyst estimate and down from $3.89 billion in the same period last year. Despite the shortfall, investor sentiment appeared positive as markets focused on the company’s restructuring efforts and improving operational performance across divisions.
The company reported an adjusted loss per share of -$44.37, primarily reflecting a one-time, non-cash impairment charge of $16.48 billion tied to the abandonment and decommissioning of parts of its 5G network. The decision followed two major spectrum transactions announced during the quarter — a $22.65 billion deal with AT&T and a $19 billion agreement with SpaceX.
“EchoStar will soon be in the unique position of having substantial available capital, vastly changing its scope of opportunities,” said Hamid Akhavan, CEO of the newly formed EchoStar Capital division. “Through EchoStar Capital we will fuel EchoStar’s growth into new and complementary arenas.”
The company’s wireless segment posted solid results, with 223,000 net subscriber additions during the quarter, bringing the total to about 7.52 million. Churn improved by 13 basis points year-over-year, while average revenue per user (ARPU) rose 2.6% compared to the prior year.
In the Pay-TV business, which includes DISH TV and Sling TV, performance also strengthened. DISH TV churn reached a record low for the third quarter at 1.33%, improving 14 basis points year-over-year, while Sling TV added 159,000 subscribers.
EchoStar also announced an amended agreement with SpaceX to sell its unpaired AWS-3 wireless spectrum for $2.6 billion in SpaceX stock, bolstering its balance sheet and providing further flexibility as it pivots toward new growth opportunities and capital redeployment.