Dish Network posted a surprise loss for the third quarter as pay TV subscriptions dropped more than expected in the face of tough competition from streaming services, sending its shares down nearly 15% on Monday.
The company also said CEO Erik Carlson was stepping down as part of a planned merger with satellite operator EchoStar, a deal that will reunite billionaire Charlie Ergen’s telecom empire and create a nearly $6 billion company.
Dish is trying to expand its presence in the wireless market as its traditional TV business takes a hit from customers cutting the cord in favor of streamers including Netflix and Disney+.
Its pay-TV subscribers, which includes Dish TV and Sling TV customers, fell by 64,000 in the three months to September, larger than Visible Alpha estimates for a decline of 39,620.
Dish had added 30,000 subscribers a year ago for the September quarter, a traditionally strong period for its Sling TV streaming service thanks to college football and NFL.
But the company said in September that US-based Hearst Television had removed customer access to 37 local channels in 27 markets after a disagreement over distribution rates despite months of talks.
Dish posted a loss of $139 million, or 26 cents for the third quarter, while analysts’ had expected a 5-cent profit, LSEG data showed. Revenue fell nearly 10% to $3.70 billion, missing estimates of $3.72 billion.
Dish lost 225,000 retail wireless net subscribers in the quarter, compared with a 1,000 increase in the prior year.
In July, the company said its unit Boost Infinite had partnered with Amazon to sell postpaid wireless plans through the e-commerce platform in the US.
Dish also has the option to buy 800 megahertz of T-Mobile’s spectrum licenses, but has not yet made the move.
Bloomberg News reported last month that the companies told a court they had agreed to give Dish until April 1 to buy the airwaves after the satellite network missed an August deadline.