Satellite television provider Dish Network Corp's posted deeper-than-expected subscriber losses for the fourth quarter as many customers canceled service after a dispute with Fox Network in October blacked out sports programs.
The second-largest U.S. satellite TV provider lost 156,000 subscribers in the quarter. Barclays analyst James Ratcliffe had expected Dish to lose 10,000 subscribers.
Dish shares in midafternoon trading were down 2 percent at $22.47. Earlier in the day, shares fell nearly 3 percent to $22.25, which Ratcliffe attributed to investors being confused about the company's long-term strategy and how it plans to use its cash.
In early February, Dish Network Corp spent about $1 billion buying DBSD North American, a hybrid satellite and land-band communications company.
The question investors have is: 'What is the company's long-term vision and what does that mean for how it deploys its capital? said Ratcliffe.
He said the company bought less than $400,000 worth of its shares in the fourth quarter, which pales in comparison with the $1.55 billion in shares that its rival DirecTV bought over the same time period.
The company also appears to be losing market share to DirecTV, which reported a higher-than-expected profit and subscriber additions.
For Dish, these are terrible subscriber numbers -- they really lost the match, especially with DirecTV posting such great numbers yesterday, said Wunderlich Securities analyst Matthew Harrigan.
Dish's subscriber losses reflect the same weakness affecting the cable TV industry, where viewers are canceling their service because they can no longer afford it and are turning to free content on the Internet.
In a regulatory filing, Dish blamed multiple programing interruptions related to contract disputes with several content providers during the fourth quarter for some of its subscriber losses.
Dish was in a dispute with News Corp's Fox Network in October after their programing deal expired. Viewers were deprived of Fox's regional sports networks, but the companies struck a deal in time for Major League Baseball's World Series.
Earlier this month, Cablevision Systems Corp, another pay-TV provider, also blamed its quarterly subscriber losses on a programing blackout with Fox.
Dish's fourth-quarter net income attributable to common shareholders rose 41 percent to $252 million, or 56 cents a share. Analysts on average were expecting 54 cents a share, according to Thomson Reuters I/B/E/S.
Revenue rose 8.2 percent to $3.21 billion, in line with expectations.
(Additional reporting by Sayantani Ghosh in Bangalore; Editing by Saumyadeb Chakrabarty and Gunna Dickson)