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DirecTV Q3 Profit Up 24%, Results Beat View

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Satellite television company DirecTV Inc. (DTV) on Tuesday reported a 24 percent increase in profit for the third quarter from last year on higher revenues. Both earnings per share and revenue for the quarter beat analysts' expectations.

The increase in revenue was driven by higher average revenue per user or ARPU as well as subscriber additions at DirecTV U.S.

Revenues from DirecTV U.S for the third quarter increased 7 percent to $6.17 billion, reflecting strong ARPU growth along with a larger subscriber base. ARPU increased 6.2 percent to $102.37, while average monthly churn rate declined to 1.61 percent from 1.74 percent in the year-ago quarter.

Net subscriber additions in DirecTV U.S rose to 139 thousand from 67 thousand in the prior-year period, principally due to a lower average monthly churn rate. DirecTV U.S. ended the quarter with 20.16 million subscribers, compared with 19.98 million subscribers in the same period last year.

DirecTV Latin America owns about 93 percent of Sky Brasil, 41 percent of Sky Mexico and 100 percent of PanAmericana, which covers most of the remaining countries in the region.

DirecTV Latin America revenues for the quarter rose 5 percent to $1.66 billion, reflecting strong subscriber growth that was partly offset by a 11.7 percent decline in ARPU. Net additions of 260 thousand were sharply lower than net additions of 543 thousand in the year-ago period due to a decline in gross additions and higher churn.

Cumulative subscribers at DirecTV Latin America at the end of the quarter were 11.34 million, up from 9.67 million in the prior-year quarter. DirecTV Latin America and Sky Mexico surpassed 17 million customers in the quarter.

DirecTV's net income for the third quarter rose to $699 million or $1.28 per share from $565 million or $0.90 per share in the prior-year period. On average, 26 analysts polled by Thomson Reuters expected the company to earn $1.02 per share for the quarter. Analysts' estimates typically exclude special items.

Revenues for the quarter grew 6 percent to $7.88 billion from $7.42 billion in the same period last year and beat analysts' consensus estimate of $7.85 billion.

The increase in revenue was driven by DirecTV U.S. ARPU growth of 6.2 percent, along with strong DirecTV Latin America subscriber growth over the last year.

Total operating costs and expenses advanced to $6.66 billion from $6.35 billion a year earlier.

DTV closed Monday's regular trading session at $64.37, up $0.70 on a volume of 3.69 million shares.

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