EchoStar Corp (SATS) Q2 2025 Earnings Call Highlights: Navigating Challenges and Strategic ...
OIBDA: $280 million in Q2, a decrease of $163 million year-over-year.
Operating Free Cash Flow: $166 million positive for the first half of the year.
Free Cash Flow (including debt service): Negative $739 million for Q2.
Total Cash and Marketable Securities: $4.7 billion as of June 30, 2025, a decrease of $711 million from the prior quarter.
Wireless Revenue: Increased by 4.7% to $935 million in Q2.
Wireless OIBDA Loss: Increased to negative $452 million from negative $394 million last year.
Pay-TV Revenue: Decreased 8% to $2.5 billion.
Pay-TV OIBDA: Decreased to $663 million from $753 million in the prior year.
Broadband and Satellite Services Revenue: Decreased by 13.8% to $340 million.
Broadband and Satellite Services OIBDA: Decreased by 17.8% to $68 million.
Wireless Subscribers: Added approximately 212,000 net subscribers, ending the quarter with 7.4 million subscribers.
Pay-TV Subscribers: DISH TV finished the quarter with approximately 5.3 million subscribers.
HughesNet Broadband Subscribers: Closed Q2 with approximately 820,000 subscribers.
Sling Subscribers: Closed the second quarter with approximately 1.8 million subscribers.
Warning! GuruFocus has detected 6 Warning Signs with SATS.
Release Date: August 01, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
EchoStar Corp (NASDAQ:SATS) announced an agreement with MDA Space to be the prime contractor for their new LEO satellite constellation, aiming to provide global wideband services directly to standard 5G NTN devices.
The company reported a sequential growth in its wireless segment with 212,000 net subscriber additions, compared to a net loss in the same period of 2024.
EchoStar Corp (NASDAQ:SATS) achieved a churn rate of 2.69% in its wireless segment, an improvement of 24 basis points year-over-year, indicating better customer retention.
The company's broadband and satellite services segment saw an 8% increase in enterprise committed contract volume year-over-year, showcasing growth in enterprise demand.
EchoStar Corp (NASDAQ:SATS) has invested over $13 billion in the S-band spectrum since 2012, demonstrating a long-term commitment to expanding its technological capabilities and market presence.
Negative Points
The FCC's review of EchoStar Corp (NASDAQ:SATS)'s spectrum licenses has introduced uncertainty, freezing the company's ability to make decisions about its 5G terrestrial network buildout.
Revenue for the second quarter was approximately $3.7 billion, a decrease of 5.8% year-over-year, primarily due to fewer subscribers in the Pay-TV and Broadband and Satellite Services segments.
OIBDA decreased by $163 million year-over-year, driven by fewer subscribers in Pay-TV and increased operating losses in the wireless segment due to higher subscriber acquisition costs.
Free cash flow, including debt service, was negative $739 million for the second quarter, a significant decrease compared to the prior year.
EchoStar Corp (NASDAQ:SATS) has suspended further 5G network buildout due to the FCC's inquiry, impacting its ability to expand its network infrastructure.
Q & A Highlights
Q: Can you elaborate on the decision to pursue the non-terrestrial network direct-to-device LEO constellation and its market strategy? A: Hamid Akhavan, President and CEO, explained that EchoStar is uniquely positioned to offer wideband services directly to devices, unlike others who focus on narrowband or broadband. The company plans to leverage its global spectrum rights and 5G NTN standardization to provide seamless connectivity. While EchoStar is open to partnerships, the current strategy is to go to market primarily through a wholesale model with carriers, aiming for a $5 billion peak funding spread over time.
Q: How does EchoStar envision the LEO constellation fitting into the existing wireless market? A: Hamid Akhavan stated that initially, the LEO constellation will complement terrestrial networks by covering areas that are uneconomical for terrestrial coverage. Over time, as satellite capacity increases, it could relieve carriers from the cost of maintaining networks in sparsely populated areas. The goal is to enhance carrier services without replacing them.
Q: What is the status of EchoStar's discussions with the FCC regarding spectrum rights, and how does it impact your operations? A: Hamid Akhavan noted that discussions with the FCC are ongoing, and while they have introduced uncertainty, EchoStar is working collaboratively to find a solution. The company has suspended further 5G network buildout until the matter is resolved but remains committed to optimizing existing infrastructure.
Q: Can you provide more details on the financial implications and timeline for the LEO constellation project? A: Hamid Akhavan clarified that the $5 billion peak funding includes satellite manufacturing, launch, and operational costs. The $1.3 billion agreement with MDA is part of this total. The project is expected to be self-funded after reaching peak funding, with commercial services launching in 2029.
Q: How does EchoStar plan to address its financial obligations while investing in the LEO project? A: Hamid Akhavan acknowledged the need to balance financial obligations with new investments. While specific financing details were not disclosed, he emphasized that the company is considering various options to ensure financial stability and intends to provide more information at the upcoming satellite show in Paris.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
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