DIRECTV (DTV) Tops Q4 EPS by 13c

DIRECTV (NASDAQ: DTV) reported Q4 EPS of $1.53, $0.13 better than the analyst estimate of $1.40. Revenue for the quarter came in at $8.92 billion versus the consensus estimate of $8.91 billion.

Fourth Quarter Review

In the fourth quarter, DIRECTV U.S. revenues increased 5% to $7.14 billion compared with the fourth quarter of 2013 primarily due to strong ARPU growth along with a larger subscriber base. ARPU increased 5.0% to $117.30 mostly due to price increases on programming packages, higher advanced receiver service fees, higher ad sales, increased commercial business revenues and higher set-top box lease fees. These improvements were partially offset by increased promotional offers to existing customers and lower revenues from pay-per-view events. DIRECTV U.S. ended the year with 20.35 million subscribers.

DIRECTV U.S. net subscriber additions of approximately 149,000 increased compared to the prior year period principally due to higher gross subscriber additions and a four basis point improvement in the average monthly churn rate. The increase in gross additions was mainly associated with a successful new ad campaign, enhanced promotions, wider distribution in the consumer electronics channel and competitor programming disputes. The decrease in the monthly churn rate was primarily due to lower voluntary churn from improved retention practices, as well as more successful winback offers.

Fourth quarter OPBDA decreased slightly to $1.51 billion and OPBDA margin declined to 21.1% as higher revenues were offset by increased programming costs mostly related to programming supplier rate increases and higher subscriber acquisition costs. The higher subscriber acquisition costs were principally associated with an increase in promotional offers targeted at higher quality subscribers and a higher mix of sales from the consumer electronics channel, as well as increased usage of refurbished set-top boxes. The decline in margin was partially offset by lower upgrade and retention expenses mostly related to reduced equipment costs, as well as lower general and administrative expenses primarily related to a pension settlement charge in the fourth quarter of 2013. Operating profit decreased to $1.07 billion and operating profit margin declined to 15.1% in the fourth quarter mostly due to the decline in OPBDA margin.

For earnings history and earnings-related data on DIRECTV (DTV) click here.

You May Also Be Interested In

• Lockheed Martin (LMT) Tops Q1 EPS by 53c, Beats on Revenue; Offers FY24 Guidance
• Dominion Resources, Inc. (D) PT Raised to $43 at BofA Securities
• W.R. Berkley (WRB) Tops Q1 EPS by 13c