DirecTV Returns to Profit in 2Q

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DirecTV Group Inc. Thursday reported second-quarter net income of $162 million and operating profit of $312 million.

The direct-broadcast satellite giant had posted a $13 million net loss in the second quarter of 2004 and an operating loss of $28 million.

DirecTV said revenue increased 21% versus year-ago levels to $3.19 billion and operating profit before depreciation and amortization of $523 million more than tripled compared with the prior-year quarter.

“With 964,000 gross subscriber additions in the quarter, demand for DirecTV continues to be strong,” CEO Chase Carey said in a prepared statement. “With the stricter credit-screening policy that we implemented at the beginning of the second quarter, we are now attaining subscribers with improved credit profiles.”

He added, “However, DirecTV's net subscriber additions of 225,000 were lower due to a disappointing average monthly churn rate in the quarter of 1.69%, primarily resulting from an increase in involuntary churn of high-risk customers attained over the last several quarters.”

Over the past year, the cumulative number of DirecTV subscribers increased 13% to 14.67 million, the DBS company said.

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