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UPDATE 3-Dish beats on profit and subscribers, shares soar
* Q4 EPS $0.70 vs analyst view $0.56
* Rev up 2.1 pct to $2.91 billion
* Loses 94,000 net subscribers
* Shares up over 20 percent (Adds CEO comment, analyst, share move)
By Yinka Adegoke and Franklin Paul
NEW YORK, May 11 (Reuters) - U.S. satellite TV provider Dish Network Corp (DISH.O) posted a better-than-expected profit on Monday and lost fewer subscribers than most Wall Street analysts had forecast, sending its shares soaring.
The Englewood, Colorado-based company lost 94,000 subscribers in the first quarter, fewer than the 128,000 analysts had expected on average.
Dish has lost subscribers on a net basis for four consecutive quarters as it struggles with operational issues and stiffer competition, which has prompted most analysts to lower their expectations.
"The results were bad -- a loss of 94,000 subscribers isn't good news in anyone's book -- but they could have been much worse," said Craig Moffett, analyst at Sanford Bernstein in a client note.
Shares rose as much as 21.5 percent in afternoon trading on the Nasdaq on the lower customer losses and indications that the company had started to get control over a long-standing problem with piracy with its set-top box software.
"The Street underestimated the impact of piracy on their business," said Todd Mitchell, analyst at Kaufman Bros. "Last quarter they went after the retailers that are the source of their piracy; and swapping customers' smart cards, you should see a small surge in customer additions going forward," said Mitchell.
Dish Network, controlled by entrepreneur Charlie Ergen, attributed the first-quarter subscriber loss to the weak economic environment, as well as aggressive promotional pricing by its rivals.
Earlier this year, AT&T Inc (T.N) ended a partnership with Dish that had allowed the phone company to package its telephone and Internet offerings with Dish's video service. The partnership had previously been an important new customer channel for Dish.
Ergen, who made key changes to his management team earlier this month, said that the company is working hard to turn things around by eliminating problems like piracy and customer service issues. But he cautioned it would take some time.
"It's not going to happen overnight, but I think we have the team to move forward to go execute to get better every day," said Ergen on a conference call with analysts.
Net income rose to $312.7 million, or 70 cents per share, from $258.6 million, or 57 cents a share, a year earlier, the company said.
Revenue rose 2.1 percent to $2.91 billion.
Analysts had expected a profit of 56 cents a share, on revenue of $2.90 billion.
Dish -which competes for subscribers with local cable operators, phone companies and its larger rival DirecTV Group Inc (DTV.O) -- said its average revenue per user increased to $70.03 from $67.93 a year earlier.
But customer churn -- the monthly rate at which it loses customers -- increased to 1.83 percent from 1.68 percent a year before.
EchoStar Corp (SATS.O), which was spun out of Dish last year, on Monday reported a quarterly loss, hurt mainly by a drop in the amount of satellite equipment sold to Dish [nBNG39171].
Shares of Dish Network were up $3.13 to $18.44 in afternoon trade on Nasdaq. Earlier they reached as high as $18.61. (Reporting by Franklin Paul and Yinka Adegoke; Editing by Derek Caney and Gerald E. McCormick)
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