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[Satellite TODAY Insider 11-07-11] Pay-TV operator DirecTV gained more than 327,000 subscribers in the United States during its third quarter 2011 — the company’s highest net addition result in seven years — due to the strength of its NFL Sunday Ticket promotional content package, according to its latest financial results issued Nov. 3.
DirecTV recently ran a promotion to provide its $323 NFL Sunday Ticket package for free to customers who signed two-year video contracts. The deal represented the first time the operator included the service in a free giveaway since acquiring the rights to broadcast NFL games in 1994. In 2009, DirecTV signed an agreement with the league to pay about $4 billion for exclusive rights to NFL live games through 2013.
Earlier this year, the threat of an NFL Players Union strike had some analysts worried about the company’s health throughout the fall and winter seasons. DirecTV CFO Patrick Doyle said that while the NFL Sunday Ticket promotion was more popular than he anticipated, the company is much more interested in the long-term results. “The test of the success of our promotion will be the renewal rate next year, when we will have a much bigger pool of customers to up-sell in a year’s time thanks to the promotion,” Doyle said in a statement, adding that the rapid rate of customer additions also drove up its programming.
DirecTV does not expect to add as many customers in the fourth quarter 2011 in the wake of the promotion, but does expect to outperform its second quarter 2011 net addition mark of 26,000 U.S. subscribers.
Outside of the United States, DirecTV Latin America CEO Bruce Churchill gave analysts a pleasant surprise when he raised his division’s 2011 full-year revenue forecast from 30 percent to 40 percent, due to strong projected mid-term growth in Latin American markets. DirecTV Latin America added more than 574,000 customers during the quarter.
DirecTV’s overall profits rose from $479 million in the third quarter 2010 to $516 million in the previous quarter ending Sept. 30. The company’s third quarter revenue also rose 14 percent year-over-year to $6.84 billion. DirecTV bought back $1.45 billion of its shares in the quarter as part of the $6 billion share repurchase program the operator announced in February. Doyle said the company would continue to buy back its shares at a rate of about 100 million per week.
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