Dish Network ( DISH) shares fell Monday after the satellite-television provider reported a weaker-than-expected quarterly profit as subscribers continued to leave the service. The Englewood, Colo., company said third-quarter net income fell to $91.9 million, or 20 cents a share, from earnings of $199.7 million, or 44 cents a share, in the same quarter a year earlier. Dish blamed the year-over-year decline on impairments on marketable and nonmarketable securities. Revenue rose 5.1% from the year-ago period to $2.94 billion. Dish Network said that it lost approximately 10,000 net subscribers during the third quarter, ending the three-month period with roughly 13.78 million users. By comparison, rival DirecTV ( DTV) added 156,000 net new U.S. customers in the third quarter, although that number was down from 240,000 in the same quarter a year ago. "Dish's subscriber loss of 10,000 subscribers is yet another indication of the travails at the low end of the market," Craig Moffett, an analyst with Sanford Bernstein. "Things are getting worse at the low end even faster than things are beginning to weaken at the top." Also on the negative side, the average monthly churn rate, which measures the number of subscribers who left the service, increased to 2.02% from 1.94% in the year-ago quarter. Additionally, the average subscriber acquisition cost increased to $735 from $646.
"Subscriber losses, churn rate, earnings and margins were all much worse," Moffett wrote in a research report. "In short, there are no signs of a turnaround. Dish is not having success keeping its customers ... and it is not having success getting new ones in the door." Shares of Dish were lately down 28 cents, or 1.8%, to $15.24.