What To Expect From Dish Network’s Q2

+102.58%
Upside
5.77
Market
11.69
Trefis
DISH: DISH Network logo
DISH
DISH Network

Dish Network (NASDAQ:DISH) is scheduled to announce its fiscal second quarter results on Friday, August 3. The company’s revenues declined in Q1 and it missed estimates, as it navigated a viewer shift from its legacy offering to streaming Sling TV. However, Sling TV adds of about 91,000 couldn’t totally mitigate a decline in satellite subscriptions of 185,000. As a result, the company’s subscriber-related revenue fell 6% y-o-y to $3.42 billion and net income declined 2% y-o-y to $368 million in Q1. While the entire Pay TV domain is suffering from the cord cutting phenomenon, the impact on Dish has been significant, as evidenced by the fact that the company has been unable to sustain its subscriber base despite a positive contribution from its streaming service Sling TV.

Dish Network’s stock price has declined more than 60% over the course of 2018, due to the continued subscriber losses – driven by cord cutting and the increasing popularity of over-the-top (OTT) streaming services from companies such as Netflix (NASDAQ:NFLX), Amazon (NASDAQ: AMZN) and Hulu. We have maintained our long-term price estimate for the company at $40, which is now around 30% ahead of the current market price. We have created an Interactive Dashboard on Dish Network’s 2018 earnings which outlines our forecasts for the company’s Q2 and full-year fiscal 2018 results. You can modify our forecasts to see the impact any changes would have on the company’s earnings and valuation. Our valuation dashboard suggests that Dish Network’s valuation still has some upside.

Q2 Trends

Relevant Articles
  1. With Echostar Merger Approaching, What To Expect From Dish’s Q3 Results?
  2. Can Dish Network Stock Return To Its Pre-Inflation Shock Highs?
  3. Dish Stock Has Big Upside Potential To Its Pre-Inflation Peak
  4. How Will The Cyber Attack Impact Dish’s Q1 Results?
  5. Is Dish Network Stock A Buy Despite Many Headwinds?
  6. Will Dish Network Stock Continue To Underperform?

We expect Dish Network to continue to see subscriber losses for Q2 which, coupled with pressure on average revenue per user (ARPU), will negatively impact revenues in the quarter. However, the company continues to offer “skinny bundles” to lure customers back to its Pay TV services through Sling TV, which could offset some of the secular pressure. We expect the company to report a 2% decline in revenues to around $3.4 billion.

Fiscal 2018 Outlook

We expect Dish Network to generate over $14 billion in revenues in 2018, and earnings of about $1.8 billion. Our revenue forecast of about $14.1 billion represents a modest year-on-year decline. Of the total expected revenues in 2018, we estimate $14 billion from the subscription-related business and over $100 million from equipment sales. In 2017, Dish Network lost approximately 284,000 net Pay-TV subscribers compared to a loss of approximately 392,000 net subscribers during the same period in 2016. We forecast the company’s total subscribers to continue to decline to around 12.9 million, with an average monthly fee per subscriber of around $91, translating into $14 billion in subscription-related revenues in 2018.

What’s behind Trefis? See How It’s Powering New Collaboration and What-Ifs

For CFOs and Finance Teams | Product, R&D, and Marketing Teams

More Trefis Research

Like our charts? Explore example interactive dashboards and create your own.