DirecTV Group Inc. reported revenues of $3.4 billion and a profit of $235 million in the 2006 first quarter, the direct-to-home satellite operator announced May 4.

Revenues were up 8 percent from the first quarter of 2005 when DirecTV reported a $41 million loss. DirecTV credited the earnings rebound to higher operating profit, higher interest income resulting from higher average cash and short term investment balances and a $25 million gain on the sale of the remaining interest in HNS in January.

DirecTV U.S. reported revenue growth of 14 percent to $3.2 billion, while operating profit before depreciation and amortization more than doubled to $545 million.

“Similar to recent quarters, this solid growth was driven by our large and growing subscriber base, strong ARPU growth and higher operating margins due mostly to the significant scale and operating leverage of our business,” the company’s Chase Carey, president and CEO, said in a statement. “In addition to the strong financial performance, first quarter results also reflect the benefits gained from our strategy to attain higher quality subscribers. DirecTV’s stricter credit policies and revised dealer incentives implemented over the past several quarters have impacted both our gross and net subscriber growth.”

DirecTV U.S. reported a drop in gross of additions of 19 percent to 919,000 in the first three months of 2006, and net additions of 255,000. Churn improved for the first time in nearly two years, dipping to 1.45 percent in the first quarter. Average revenue per user improved 6 percent to $69.75 due primarily to price increases and higher mirroring, lease, digital video recorder and high-definition programming fees.

Revenues for DirecTV Latin America grew 5 percent to $193 million in the 2006 first quarter primarily due to a larger subscriber base. Operating profit before depreciation and amortization was $44 million, compared to a $14 million operating loss in the first quarter of 2005, due to a $57 million gain recorded from the Sky Mexico transaction.

DirecTV Latin America added 62,000 net subscribers in the 2006 first quarter, mainly in

Venezuela and Argentina, bringing its total subscriber base to 1.7 million.