Hughes Electronics

(GMH)

isn't dishing it the way Wall Street might have hoped.

The company behind the

DirecTV

home satellite services in the U.S. and Latin America said Monday night that it would miss subscriber growth forecasts for the second quarter and the rest of the year. Hughes, a unit of

General Motors

(GM) - Get General Motors Company (GM) Report

, cut revenue forecasts for the full year, though it boosted the low end of its estimated range for full-year earnings before interest, taxes, depreciation and amortization.

In trimming revenue growth estimates, Hughes CEO Jack Shaw acknowledged that Hughes executives -- specifically Eddy Hartenstein, senior vice president of the consumer sector, and Chief Financial Officer Roxanne Hughes -- had been distracted by the "uncertainty and complexity" of finding a business partner for the company. "Our performance is not satisfactory," Shaw told financial analysts on a conference call.

As GM has attempted to raise cash, the company has spent months trying to reach a deal that would combine Hughes with satellite properties controlled by Rupert Murdoch's

News Corp.

(NWS) - Get News Corporation Class B Report

. Meanwhile, home satellite competitor

EchoStar Communications

(DISH) - Get DISH Network Corporation Class A Report

is also attempting to strike some sort of deal with GM for Hughes.

Ahead of Monday night's announcement, Hughes fell 50 cents to close at $22.60. In light after-hours trading on

Island

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, the company's shares fell to $21.65.

Home on the Range

Instead of 2001 U.S. DirecTV revenue in the range of $5.6 billion to $5.8 billion, Hughes is now forecasting revenue of $5.5 billion to $5.7 billion. Instead of U.S. net subscriber growth of 1.5 million to 1.7 million, Hughes is now aiming for 1.3 million -- a target about which several analysts on the call expressed varying degrees of skepticism. The company aims to have 10 million U.S. subscribers by the end of the second quarter.

Rather than the 20%-25% revenue growth previously forecast for all of Hughes, the company is now forecasting 20% growth. Because the lower subscriber projections will result in lower marketing expenses, Hughes raised its forecast EBITDA range from $550 million-$650 million to $575 million-$650 million.

The company blamed its lower subscriber growth on two factors. Sales at the company's primary distribution outlets -- retailers such as

RadioShack

(RSH)

and

Circuit City

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-- are slower than expected because of the softening economy, Hughes says.

In addition, Hughes says DirecTV subscriber growth in rural markets served by the

National Rural Telecommunications Cooperative

have been slower than expected. Indeed,

Pegasus Communications

(PGTV)

, which markets DirecTV through that arrangement, said last month that it was

cutting subscriber growth targets because customer acquisition had become too costly.

In light of the economy and Pegasus's announcement, one portfolio manager, speaking on condition of anonymity, said, "I don't think it's overly shocking." But Hughes' announcement, says the manager, points to the contrast between Hughes and EchoStar, which

beat subscriber growth forecasts in its latest quarterly report. "That just tells you EchoStar is eating Hughes' lunch in the rural markets," says the manager, who owns stock in both firms.