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DirecTV Swings to Profit

The rate of net subscriber additions slows.
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swung to a second-quarter profit on a 21% rise in sales, helped by higher spending among customers on its satellite television offerings.

The company earned $162 million, or 12 cents a share, in the quarter, compared with a loss of $13 million, or 1 cent a share, last year. The latest quarter included a gain of $33 million from a tax settlement and a charge of $65 million from a debt redemption. Revenue was $3.12 billion in the quarter, up from $2.64 billion a year ago.

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Analysts were forecasting earnings of 4 cents a share on sales of $3.15 billion.

DirecTV's operating profit before depreciation and amortization was $523 million in the latest quarter compared with $143 million a year ago. The company had net subscriber additions of 225,000 in the quarter and U.S. average revenue per user of $67.79, up from $65.01 a year earlier.

Net subscriber additions were down from 409,000 a year ago, a trend the company blamed on "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."