DirecTV Releases 4th Quarter Profit

Although DirecTV was expected to release performance figures that were better than its competitors in the Pay-TV market, it was not expected to show a profit. Fortunately for shareholders, the satellite giant showed a reversal of industry trends and even a small profit for investors.

“Our fourth quarter results, although marked by challenging macroeconomic conditions in Latin America and a conscious decision to reinvest in our U.S. business, capped off another strong year of operations for DIRECTV,” said Mike White, President and CEO of DirecTV to Benzinga. “In Latin America, despite the macroeconomic headwinds, our DIRECTV and Sky brands attracted over 1.4 million net new customers – surpassing the 19 million cumulative subscriber mark by year-end.”

During the first three-quarters of 2014, DirecTV lost 50,000 subscribers to increased competition in what Satellite TV More described as a “saturated market.” The loss in the customer base was much better than companies such as Comcast and Time Warner Cable. Time Warner lost over 400,000 Pay-TV subscribers during 2014.

Foreign growth, specifically in Latin America, is driving DirecTV’s current strength although the fluctuations in the exchange rate, as well as devaluation of local currency, make accurate earnings harder to determine.

The United States market accounts for almost 65 percent of DirecTV’s stock value and the company has approximately 20 million subscribers in the US. The company credits its exclusive NFL Sunday Ticket with the increase in subscribers. The contract with the NFL has been extended for an additional eight years, but it came with a price tag that had an almost 50 percent increase to $1.5 billion.

“2015 will bring additional challenges to our businesses, but given our solid continued operating momentum and the pending merger with AT&T, I am confident that we will continue to drive value for our shareholders for the foreseeable future,” White added.

The merger with AT&T, which was predicated on DirecTV retaining its current agreement with the NFL, has also kept the company shares from falling in value. AT&T agreed to buy DirecTV for $48 billion. The merger will strengthen both companies and is currently waiting FCC approval

Khurram Aziz is a web entrepreneur who trained as a journalist. He is a freelance writer, runs online ventures, and consults on WordPress and Magento web development.