DirecTV Inc. parent Hughes Electronics Corp. said it would substantially
exceed subscriber-growth targets in the first quarter, beating earlier
predictions by 75,000 customers.
Hughes -- which agreed to merge with rival direct-broadcast satellite
provider EchoStar Communications Corp. last October -- said it expects to add
about 325,000 new subscribers in the first quarter, which ends March 31.
Previously, Hughes had predicted that it would add between 200,000 and
Hughes also said it would hit its previous guidance of $80 million to $100
million in cash flow for the quarter, despite exceeding its subscriber
Hughes is scheduled to release first-quarter results April 15.
CIBC World Markets cable and satellite analyst Jeff Wlodarczak wrote in a
research report that the subscriber additions bode well for the industry.
'The fundamental health of the DBS industry appears to be improving and,
clearly, satellite continues to be a viable competitor to cable,' Wlodarczak
He added that the additions imply that DirecTV's subscriber base will grow
12.1 percent year-over-year, comparing favorably with the 0.8 percent growth
expected in cable in the first quarter.
The news had little effect on the company's stock, which rose 33 cents per share to $16.45 apiece Thursday.