EchoStar headquarters in Engelwood, Colorado. Photo: EchoStar

EchoStar posted a 5% drop in revenue in the third quarter of 2024 as the company lost subscribers in satellite TV and broadband. EchoStar reported its third quarter financials on November 12 and closed a number of transactions to improve its capital and debt maturity profile, removing the “going concern” disclaimer the company posted earlier this year. 

EchoStar announced the strategic transactions on Tuesday, including raising $5.2 billion of spectrum-backed capital and a $400 million PIPE investment. With these transactions, EchoStar CEO Hamid Akhavan told investors the company removed the “going concern” disclosure from earlier this year that indicated doubt EchoStar could continue operations without additional funds. 

CEO Hamid Akhavan told investors he believes the company’s spectrum is undervalued in its stock price. 

“The recent transactions highlight the valuation of our spectrum assets. As we look to the future of connectivity and an AI-powered world, wireless connectivity will be a primary enabler, and wireless spectrum will be the most scarce resource, giving further rise to its valuation,” he told investors on Tuesday. 

“We believe there are upwards of tens of billions of dollars in asset value that are not accounted for in our current market cap. Closing this gap could have a tremendous positive impact on our share price. We are focused on realizing this value for our shareholders through robust development and scaling of our mobile business,” Akhavan added. 

EchoStar is currently going through a deal to sell Dish TV and Sling TV to refocus on wireless and satellite connectivity solutions. However, the deal has some difficulties to be realized. Reuters reported this week that a large group of Dish bondholders rejected a proposed debt-exchange offer from DirecTV.  

Akhavan told investors that regardless of whether the transaction closes, EchoStar has “a path forward now with the cash available to us from other sources that we have put on the balance sheet.” 

Overall, EchoStar reported $3.9 billion in revenue in the third quarter of 2024, down 5% compared to the prior year quarter, with declines in satellite TV and satellite broadband subscribers despite gains in mobile subscribers and Sling TV streaming subscribers. 

Net loss was $142 million, compared to a net loss of $138 million in the same time last year. 

Satellite Broadband Business 

Subscriber decline for Hughes Network Systems is slowing down after the launch of the JUpiter 3 high capacity satellite, EchoStar reported Tuesday. 

Revenue in the company’s Broadband and Satellite Services segment (from Hughes Network Systems) declined 6% year-over-year in the third quarter to $387 million. 

Hughes lost 43,000 subscribers during the quarter. However, the rate of decline slowed down compared to a year ago, when the company lost 59,000 subscribers. 

Hughes said the third quarter was negatively impacted by the end of the FCC’s Affordable Connectivity Program (ACP). The ACP ended on June 1 after Congress did not provide the program with funding to continue. 

However, Hughes Senior Vice President of Finance Jeff Boggs told investors the new Jupiter 3 satellite helped slow down the loss and there is increased subscriber demand for the company’s new satellite plans. 

Boggs told investors that Hughes has now shipped 10,000 user terminals for use on the Eutelsat OneWeb Low-Earth Orbit (LEO) constellation. Hughes recently reported hitting the 5,000 terminal milestone in mid-August, meaning it has shipped another 5,000 in the past three months. 

“Our focus remains, as in previous quarters, on acquiring and retaining high value customers for Hughes net in the enterprise market,” Boggs said. “Feedback from our customers continues to be very positive, and demand is increasing as we grow the business.”