Core Viewpoint - The Walt Disney Co. is suing Sling TV for including its networks in short-term packages without prior consultation, alleging a violation of their existing license agreement [2][3][4]. Company Actions - Disney filed a lawsuit in the U.S. District Court for the Southern District of New York, seeking compliance from Dish Network regarding their licensing deal [3][4]. - A Disney spokesperson emphasized that Sling's new offerings were made available without Disney's knowledge or consent [4]. Sling TV's New Offerings - Sling TV has introduced a new pay-TV model featuring short-term bundles: a $4.99 day pass, a $9.99 weekend pass, and a $14.99 seven-day pass, in addition to its standard monthly subscription starting at $45.99 [3][4]. - The new model is designed to cater to sports fans and live event viewers, particularly with the upcoming NFL season [5]. Industry Context - The streaming landscape is evolving, with services like Sling TV gaining traction among younger viewers, as traditional cable subscriptions decline [6]. - Pew reported that only about 16% of Americans aged 18-29 subscribed to cable or satellite in 2017, indicating a shift towards streaming options [6].

Table of Contents ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2025. OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO . Commission File Number: 001-39144 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark One) DISH Network Corporation (Exact name of registrant as specified in its charter) Nevada 88-0336997 (St ...

Financial Performance - Total revenue for Q1 2025 was $3,510,360, a decrease of 3.5% compared to $3,639,889 in Q1 2024[21] - Service revenue decreased to $3,333,959, down 4.9% from $3,505,432 in the same period last year[21] - Net loss attributable to DISH Network was $189,529, compared to a loss of $13,879 in Q1 2024, representing a significant increase in losses[21] - Operating income for Q1 2025 was a loss of $65,104, compared to an operating income of $25,979 in Q1 2024[21] - The company reported a comprehensive loss of $189,545 for Q1 2025, compared to a loss of $13,862 in Q1 2024[21] - For the three months ended March 31, 2025, DISH Network reported a net loss of $189,495 thousand, compared to a net loss of $10,231 thousand for the same period in 2024[27] - The operating loss for DISH Network for the same period was $65.1 million, with an OIBDA of $318.6 million[212] - For the three months ended March 31, 2024, DISH Network reported total revenue of $3.64 billion, with Pay-TV revenue at $2.73 billion and Wireless revenue at $913.43 million[214] Assets and Liabilities - Total current assets increased to $2,802,760, up 13.0% from $2,479,266 as of December 31, 2024[19] - Total liabilities rose to $39,061,424, an increase of 1.4% from $38,510,835 at the end of 2024[19] - Cash and cash equivalents increased to $791,735, up 66.2% from $476,075 as of December 31, 2024[19] - The accumulated earnings deficit increased to $382,559 from $193,030 as of December 31, 2024[25] - The carrying amount of total debt, finance lease, and other obligations, net of current portion, was $21,286,215 thousand as of March 31, 2025, compared to $20,754,776 thousand as of December 31, 2024, indicating an increase of approximately 2.6%[92] - The total cash, cash equivalents, and restricted cash at the end of the period was $1,040,339 thousand, up from $368,036 thousand at the end of the same period in 2024[27] Subscriber and Service Metrics - As of March 31, 2025, DISH Network had 7.397 million Pay-TV subscribers, including 5.503 million DISH TV subscribers and 1.894 million SLING TV subscribers[31] - The Wireless segment provides services to over 222 million Americans for 5G voice and over 269 million Americans for 5G broadband, with 7.145 million Wireless subscribers as of March 31, 2025[32][33] - Pay-TV subscriber and related revenue decreased to $2,524,352 from $2,701,179, representing a decline of 6.5% year-over-year[215] - Wireless services and related revenue increased slightly to $809,607 from $804,270, showing a growth of 0.4%[215] Cash Flows - Net cash flows from operating activities for the three months ended March 31, 2025, were $167,155 thousand, a decrease from $360,686 thousand in 2024[27] - The company reported net cash flows from investing activities of $(380,974) thousand for the three months ended March 31, 2025, compared to $520,683 thousand in 2024[27] - Net cash flows from financing activities were $523,369 thousand for the three months ended March 31, 2025, compared to $(976,081) thousand in 2024[27] Capital Expenditures and Investments - The company has invested over $30 billion in Wireless spectrum licenses, with $24 billion currently related to these licenses[34] - The company expects capital expenditures for its 5G Network to be approximately $10 billion, including amounts incurred since 2021[122] - The company incurred $352.61 million in property and equipment purchases for the three months ended March 31, 2025, compared to $508.88 million for the same period in 2024[214] Legal Proceedings - The company is involved in various legal proceedings, but management does not believe these will have a material adverse effect on financial condition[136][137] - DISH Network intends to vigorously defend against the lawsuits, acknowledging potential substantial damages and injunctions that could require modifications to current consumer offerings[143][145] - The company is currently defending against a securities fraud class action that alleges misleading public statements regarding its cybersecurity and 5G network buildout[157][158] - The company has faced multiple patent infringement allegations related to streaming and data compression technologies[167] - The outcome of several lawsuits remains uncertain, with potential implications for the company's operational features and financial liabilities[165] Advertising and Operating Expenses - Advertising expenses totaled $173 million for the three months ended March 31, 2025, compared to $123 million for the same period in 2024, representing a 40.7% increase[54] - The company reported subscriber acquisition costs of $276.97 million for the three months ended March 31, 2025[212] - DISH Network's programming costs for the three months ended March 31, 2025, were $1.22 billion, while connectivity services costs were $675.1 million[212] Research and Development - Research and development costs remained consistent at $7 million for both the three months ended March 31, 2025, and 2024[55] Marketable Securities - As of March 31, 2025, total marketable investment securities amounted to $53,623 thousand, compared to $24,168 thousand as of December 31, 2024, showing a significant increase of 122.3%[63] - The fair value of current marketable investment securities was $61 thousand as of March 31, 2025, compared to $286 thousand as of December 31, 2024, indicating a decrease of 78.7%[63]

About DISH Media DISH Media provides advertisers with intelligent solutions to efficiently maximize exposure to desired audiences across DISH TV and Sling TV while safeguarding consumer personal information. Through innovative platforms like addressable targeting and programmatic buying, viewer measurement tools and access to custom audiences on DISH TV and Sling TV, advertisers employ data-driven, demographically targeted buys that enhance their national media campaigns. Visit media.dish.com. DISH Media is ...

[PART I](index=6&type=section&id=PART%20I) [Item 1. Business](index=6&type=section&id=Item%201.%20Business) DISH Network, a wholly-owned EchoStar subsidiary, operates Pay-TV and Wireless segments, serving 7.778 million and 6.995 million subscribers respectively, while deploying a nationwide 5G O-RAN network - On December 31, 2023, EchoStar completed its acquisition of DISH Network, making DISH a wholly-owned subsidiary[27](index=27&type=chunk) - A planned acquisition of DISH's Pay-TV business (DISH DBS) by DIRECTV was terminated in November 2024 after certain conditions were not met[28](index=28&type=chunk)[29](index=29&type=chunk) Subscriber Count by Segment (as of Dec 31, 2024, in millions) | Segment | Brand(s) | Subscriber Count | | :--- | :--- | :--- | | **Pay-TV** | DISH TV & SLING TV | **7.778** | | | DISH TV | 5.686 | | | SLING TV | 2.092 | | **Wireless** | Boost Mobile & Gen Mobile | **6.995** | - The company is deploying the nation's first cloud-native, Open Radio Access Network (O-RAN) based 5G network, meeting its June 2023 and December 2024 FCC deployment commitments with deadlines extended to 2026 and potentially 2028[36](index=36&type=chunk)[37](index=37&type=chunk)[38](index=38&type=chunk) - DISH Network's current investment in Wireless spectrum licenses stands at **$24 billion**, not including an additional **$7 billion** in capitalized interest[36](index=36&type=chunk)[45](index=45&type=chunk) [Item 1A. Risk Factors](index=14&type=section&id=Item%201A.%20Risk%20Factors) The company faces intense competition, operational dependencies, substantial debt, regulatory compliance risks, and cybersecurity threats - The company faces intense and increasing competition from traditional pay-TV providers, broadband providers, and internet-based video services, which may lead to higher subscriber acquisition costs and churn[52](index=52&type=chunk) - As an MVNO, the company depends on network services from competitors T-Mobile and AT&T, where failure to manage relationships or meet minimum commitments could materially harm the business[66](index=66&type=chunk)[67](index=67&type=chunk)[69](index=69&type=chunk) - The company has substantial debt of **$21.688 billion** as of December 31, 2024, which could make it difficult to satisfy obligations, increase vulnerability to adverse economic conditions, and limit financial flexibility[129](index=129&type=chunk) - Significant capital is required to continue the 5G network deployment and commercialize its **$24 billion** investment in wireless spectrum licenses, with failure to meet FCC build-out requirements potentially resulting in license revocation[131](index=131&type=chunk)[132](index=132&type=chunk) - The business is vulnerable to cybersecurity threats, with past and future cyber-attacks potentially disrupting operations, compromising sensitive data, and resulting in significant financial and reputational damage[117](index=117&type=chunk)[123](index=123&type=chunk)[124](index=124&type=chunk) - EchoStar is controlled by Chairman Charles W. Ergen, who beneficially owns approximately **90.6%** of the total voting power, making EchoStar a "controlled company" under NASDAQ rules[153](index=153&type=chunk) [Item 1B. Unresolved Staff Comments](index=40&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports that it has no unresolved staff comments from the SEC - There are no unresolved staff comments[162](index=162&type=chunk) [Item 1C. Cybersecurity](index=40&type=section&id=Item%201C.%20Cybersecurity) The company manages cybersecurity risks through an enterprise-wide information security program, overseen by the CISO, acknowledging past and potential future cyber-attacks - The company has an enterprise-wide information security program designed to manage cybersecurity risks, informed by the NIST Cybersecurity Framework[163](index=163&type=chunk)[164](index=164&type=chunk) - The Chief Information Security Officer (CISO), with over 25 years of experience, leads the information security organization and provides regular reports to senior management and the EchoStar Board of Directors[168](index=168&type=chunk)[169](index=169&type=chunk) - The company has experienced cyber-attacks in the past and acknowledges that future disruptions could harm the business[166](index=166&type=chunk) [Item 2. Properties](index=42&type=section&id=Item%202.%20Properties) The company's principal properties include corporate and wireless offices, customer service centers, data centers, and nine satellites for its Pay-TV segment - Key properties include the corporate headquarters in Englewood, CO, a data center in Cheyenne, WY, and digital broadcast centers in Cheyenne, WY and Gilbert, AZ[173](index=173&type=chunk) - The Pay-TV segment utilizes nine satellites, which are a major component of its DISH TV services[173](index=173&type=chunk) [Item 3. Legal Proceedings](index=42&type=section&id=Item%203.%20Legal%20Proceedings) The company is involved in various legal proceedings, with detailed information provided in Note 13 of the Consolidated Financial Statements - Information regarding legal proceedings is detailed in Note 13 of the Consolidated Financial Statements[174](index=174&type=chunk) [PART II](index=42&type=section&id=PART%20II) [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=42&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) All 1,000 shares of DISH Network's common stock are held by its parent company, EchoStar, with no public trading market - All **1,000** outstanding shares of the company's common stock are held by EchoStar, and there is no public trading market for the stock[177](index=177&type=chunk) [Item 7. Management's Narrative Analysis of Results of Operations](index=43&type=section&id=Item%207.%20Management%27s%20Narrative%20Analysis%20of%20Results%20of%20Operations) Consolidated revenue for FY 2024 decreased by 6.6% to $14.293 billion, resulting in an operating loss of $180 million due to declines in both segments and significant 5G network capital requirements Consolidated Revenue and Operating Income (Loss) (in thousands) | Metric | 2024 | 2023 | Variance ($) | Variance (%) | | :--- | :--- | :--- | :--- | :--- | | **Total Revenue** | $14,292,658 | $15,295,088 | $(1,002,430) | (6.6)% | | Pay-TV Revenue | $10,688,204 | $11,571,159 | $(882,955) | (7.6)% | | Wireless Revenue | $3,606,177 | $3,732,160 | $(125,983) | (3.4)% | | **Total Operating Income (Loss)** | $(179,625) | $175,257 | $(354,882) | N/A | - In January 2024, the company transferred assets, including certain wireless spectrum licenses and a satellite under construction with a net carrying value of **$12.003 billion**, to its parent, EchoStar, recorded as a dividend[183](index=183&type=chunk)[184](index=184&type=chunk) - In March 2024, the company sold its 700 MHz spectrum to EchoStar for **$1.037 billion**, using the proceeds to pay off a maturing convertible note[186](index=186&type=chunk) - The company experienced negative free cash flow in 2024, primarily due to capital expenditures for the 5G Network Deployment, and expects this trend to continue in 2025[204](index=204&type=chunk) [Pay-TV Segment Analysis](index=56&type=section&id=Pay-TV%20Segment%20Analysis) The Pay-TV segment's revenue decreased 7.6% to $10.688 billion due to subscriber declines, partially offset by a 4.2% ARPU increase, while operating income remained stable Pay-TV Segment Performance (FY 2024 vs. FY 2023) | Metric | 2024 | 2023 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $10.688 B | $11.571 B | (7.6)% | | Operating Income | $2.648 B | $2.700 B | (1.9)% | | Net Subscriber Losses | (0.748 M) | (1.224 M) | Improvement | | Pay-TV ARPU | $108.90 | $104.56 | +4.2% | | DISH TV Churn Rate | 1.46% | 1.69% | (0.23)% | | DISH TV SAC | $999 | $1,118 | (10.6)% | - The decrease in net DISH TV subscriber losses was primarily due to a lower churn rate, positively impacted by an emphasis on acquiring and retaining higher quality subscribers[267](index=267&type=chunk)[271](index=271&type=chunk) - The **4.2%** increase in Pay-TV ARPU was primarily attributable to programming price increases for both DISH TV and SLING TV implemented in late 2023[276](index=276&type=chunk) - Cost of services decreased **6.2%** due to a lower average subscriber base and operational efficiencies, partially offset by higher programming costs per subscriber, particularly for local broadcast channels[277](index=277&type=chunk) [Wireless Segment Analysis](index=71&type=section&id=Wireless%20Segment%20Analysis) The Wireless segment's revenue decreased 3.4% to $3.606 billion, with operating loss widening by 12.0% to $2.828 billion, despite improved churn, impacted by ACP program end and 5G network costs Wireless Segment Performance (FY 2024 vs. FY 2023) | Metric | 2024 | 2023 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $3.606 B | $3.732 B | (3.4)% | | Operating Loss | $(2.828 B) | $(2.525 B) | (12.0)% | | Net Subscriber Losses | (0.304 M) | (0.617 M) | Improvement | | Wireless ARPU | $36.57 | $36.15 | +1.2% | | Wireless Churn Rate | 3.00% | 4.17% | (1.17)% | - The conclusion of the Affordable Connectivity Program (ACP) on June 1, 2024, negatively impacted subscriber numbers, as the company had no ACP subscribers by year-end 2024[311](index=311&type=chunk)[324](index=324&type=chunk) - The Wireless churn rate improved significantly to **3.00%** from **4.17%** in the prior year, positively impacted by a focus on higher quality subscribers and the completion of a disruptive subscriber migration off the T-Mobile TSA in 2023[328](index=328&type=chunk) - Beginning Jan 1, 2024, certain 5G network deployment costs (e.g., tower leases, transport) were reclassified from "Cost of sales" to "Cost of services," causing a **53.8%** reported increase in Cost of services[325](index=325&type=chunk)[332](index=332&type=chunk) - Depreciation and amortization expense increased by **41.7%** to **$1.135 billion** due to more 5G Network Deployment assets being placed in service[335](index=335&type=chunk) [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=87&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's market risk primarily stems from its investment portfolio and substantial fixed-rate debt, limiting immediate interest rate exposure but affecting future financing - As of December 31, 2024, the company had **$476 million** in unrestricted cash, cash equivalents, and current marketable investment securities, primarily invested for principal preservation[369](index=369&type=chunk) - Total debt outstanding was **$21.779 billion** with an estimated fair value of **$20.222 billion**, with the main interest rate risk relating to future financing activities due to its primarily fixed-rate nature[373](index=373&type=chunk) [Item 9A. Controls and Procedures](index=88&type=section&id=Item%209A.%20Controls%20and%20Procedures) The company's disclosure controls and internal control over financial reporting were deemed effective as of December 31, 2024, with no material changes in the recent quarter - Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of December 31, 2024[377](index=377&type=chunk) - Management concluded that the company's internal control over financial reporting was effective as of December 31, 2024, based on the COSO framework[381](index=381&type=chunk) [PART III](index=89&type=section&id=PART%20III) [Item 14. Principal Accounting Fees and Services](index=89&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) KPMG LLP served as the independent auditor for FY 2024, with total fees of $9.02 million for the EchoStar consolidated group, all pre-approved Fees Paid to KPMG LLP (in thousands) | Fee Type | 2024 | 2023 | | :--- | :--- | :--- | | Audit Fees | $7,756 | $9,725 | | Audit-Related Fees | $480 | $1,053 | | Tax Compliance Fees | $644 | $859 | | All Other Fees | $142 | $115 | | **Total Fees** | **$9,022** | **$11,751** | [PART IV](index=91&type=section&id=PART%20IV) [Item 15. Exhibits, Financial Statement Schedules](index=91&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section lists the financial statements, schedules, and exhibits filed as part of the Form 10-K report, including the auditor's report and various agreements - The report includes the Report of KPMG LLP, Consolidated Balance Sheets, Statements of Operations, Statements of Changes in Stockholder's Equity, Statements of Cash Flows, and Notes to Consolidated Financial Statements[392](index=392&type=chunk) - No separate financial statement schedules are filed; all required information is included within the consolidated financial statements and notes[392](index=392&type=chunk) [Financial Statements and Notes](index=101&type=section&id=Financial%20Statements%20and%20Notes) [Note 1. Organization and Business Activities](index=108&type=section&id=Note%201.%20Organization%20and%20Business%20Activities) This note details DISH Network's Pay-TV and Wireless segments, highlighting the December 2023 merger with EchoStar, the terminated DIRECTV transaction, and significant 2024 asset transfers with EchoStar - On January 10, 2024, DISH transferred assets with a net carrying value of **$12.003 billion**, including various wireless spectrum licenses, to its parent EchoStar, accounted for as a dividend[441](index=441&type=chunk)[443](index=443&type=chunk) - On March 12, 2024, DISH sold its 700 MHz spectrum to EchoStar for **$1.037 billion**, using the proceeds to pay off a maturing convertible note[445](index=445&type=chunk) - In May 2024, EchoStar transferred assets, including the EchoStar XXV satellite under construction, back to DISH, valued at its historical net carrying value of **$141 million** and recorded as a capital contribution[447](index=447&type=chunk) [Note 9. Debt, Finance Lease and Other Obligations](index=148&type=section&id=Note%209.%20Debt%2C%20Finance%20Lease%20and%20Other%20Obligations) As of December 31, 2024, total obligations were $21.688 billion, with significant financing activities including new term loans, intercompany loans, and a $689 million gain on debt extinguishment from EchoStar Exchange Offers Debt Summary (as of Dec 31, 2024, in millions) | Debt Instrument | Issuer | Carrying Amount | | :--- | :--- | :--- | | 11 3/4% Senior Secured Notes due 2027 | DISH | $3,500 | | 5 1/4% Senior Secured Notes due 2026 | DDBS | $2,750 | | 5 3/4% Senior Secured Notes due 2028 | DDBS | $2,500 | | 7 3/4% Senior Notes due 2026 | DDBS | $2,000 | | Term Loan due 2029 | DBS SubscriberCo | $1,800 | | Other Notes & Leases | Various | $3,357 | | Intercompany Loans | Intercompany | $5,782 | | **Total** | | **$21,688** | - In November 2024, the EchoStar Exchange Offers resulted in the extinguishment of **$4.674 billion** (carrying value) of DISH's convertible notes, recorded as a capital contribution from the parent, EchoStar, resulting in a non-cash gain on debt extinguishment of **$689 million**[600](index=600&type=chunk)[601](index=601&type=chunk)[603](index=603&type=chunk) - In September 2024, the company received **$2.5 billion** in New DISH DBS Financing, consisting of term loans and mandatorily redeemable preferred shares, secured by approximately three million DISH TV subscribers and related assets[605](index=605&type=chunk)[606](index=606&type=chunk) - In November 2024, a subsidiary entered into an intercompany loan with EchoStar for up to **$4.5 billion**, of which **$1.015 billion** was outstanding at year-end, with interest paid in kind[649](index=649&type=chunk) [Note 13. Commitments and Contingencies](index=176&type=section&id=Note%2013.%20Commitments%20and%20Contingencies) The company has $44.5 billion in future commitments, including debt and 5G network deployment, and faces contingent liabilities from the AWS-3 Auction and ongoing patent infringement lawsuits Future Contractual Obligations (as of Dec 31, 2024, in billions) | Obligation Type | Total | Due in 2025 | | :--- | :--- | :--- | | Long-term debt | $21.8 | $0.9 | | Interest on debt | $5.0 | $1.6 | | Other long-term obligations | $9.7 | $1.9 | | Operating lease obligations | $5.7 | $0.5 | | Purchase obligations | $2.2 | $2.2 | | **Total** | **$44.5** | **$7.2** | - The company certified to the FCC in January 2025 that it met its accelerated buildout and **80%** nationwide coverage obligations due by December 31, 2024, extending final deployment deadlines to December 2026, with a potential further extension to June 2028[708](index=708&type=chunk) - The company faces a contingent liability for a potential "Re-Auction Payment" to the FCC for AWS-3 licenses that its affiliates Northstar and SNR returned, with the payment amount dependent on future re-auction results and potentially substantial[714](index=714&type=chunk)[717](index=717&type=chunk) - Significant ongoing litigation includes a patent infringement case from ClearPlay regarding the AutoHop™ feature, where a **$469 million** jury verdict was vacated by the trial court but is now on appeal[731](index=731&type=chunk) [Note 14. Segment Reporting](index=206&type=section&id=Note%2014.%20Segment%20Reporting) The company reports on two segments, Pay-TV and Wireless, with Pay-TV generating $10.688 billion revenue and $2.648 billion operating income, and Wireless generating $3.606 billion revenue with a $2.828 billion operating loss in FY 2024 - The company realigned its segments, combining the former Retail Wireless and 5G Network Deployment segments into a single "Wireless" segment[803](index=803&type=chunk) Segment Performance Summary (FY 2024, in thousands) | Segment | Total Revenue | Operating Income (Loss) | OIBDA | | :--- | :--- | :--- | :--- | | **Pay-TV** | $10,688,204 | $2,648,134 | $2,985,465 | | **Wireless** | $3,606,177 | $(2,827,759) | $(1,692,886) | Disaggregated Revenue from External Customers (FY 2024, in thousands) | Category | Revenue | | :--- | :--- | | Pay-TV subscriber and related revenue | $10,613,653 | | Wireless services and related revenue | $3,156,760 | | Pay-TV equipment sales and other revenue | $74,551 | | Wireless equipment sales and other revenue | $449,417 | | **Total (before eliminations)** | **$14,294,381** |

PART I — FINANCIAL INFORMATION [Financial Statements](index=8&type=section&id=Item%201.%20Financial%20Statements) The financial statements for Q3 2024 show a significant decline in stockholder's equity and a net loss for the period [Condensed Consolidated Balance Sheets](index=8&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of September 30, 2024, total assets decreased, liabilities increased, and stockholder's equity sharply declined Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | Sep 30, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | **Total current assets** | $4,171,312 | $2,343,661 | | **Total noncurrent assets** | $41,398,705 | $49,069,370 | | **Total assets** | **$45,570,017** | **$51,413,031** | | **Total current liabilities** | $7,285,490 | $7,592,166 | | **Total long-term obligations** | $36,984,962 | $26,590,309 | | **Total liabilities** | **$44,270,452** | **$34,182,475** | | **Total stockholder's equity (deficit)** | **$1,299,565** | **$16,792,174** | [Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20%28Loss%29) For Q3 2024, total revenue decreased, leading to an operating loss and a net loss for the quarter and nine-month period Statement of Operations Summary (in thousands) | Metric | Q3 2024 | Q3 2023 | Nine Months 2024 | Nine Months 2023 | | :--- | :--- | :--- | :--- | :--- | | **Total revenue** | $3,515,317 | $3,704,516 | $10,723,476 | $11,573,075 | | **Operating income (loss)** | $(124,500) | $(41,806) | $(130,292) | $487,951 | | **Net income (loss) attributable to DISH Network** | $(210,523) | $(139,185) | $(436,251) | $283,843 | [Condensed Consolidated Statements of Changes in Stockholder's Equity (Deficit)](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Stockholder%27s%20Equity%20%28Deficit%29) Stockholder's equity significantly decreased due to a major asset transfer to EchoStar and a net loss for the period - An asset transfer to parent company EchoStar, valued at **$12.003 billion**, was recorded as a dividend, significantly reducing accumulated earnings[23](index=23&type=chunk)[36](index=36&type=chunk) - The conversion of redeemable noncontrolling interest in SNR HoldCo to noncontrolling interest added **$442 million** to total equity[23](index=23&type=chunk)[61](index=61&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the nine months ended September 30, 2024, operating cash flow was positive, offset by investing activities, with significant financing proceeds Cash Flow Summary (Nine Months Ended Sep 30, in thousands) | Cash Flow Activity | 2024 | 2023 | | :--- | :--- | :--- | | **Net cash flows from operating activities** | $874,490 | $1,718,096 | | **Net cash flows from investing activities** | $(111,902) | $(2,498,267) | | **Net cash flows from financing activities** | $1,315,356 | $(131,725) | | **Net increase (decrease) in cash** | $2,077,944 | $(911,896) | [Notes to Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail the pending Pay-TV sale, asset transfers, segment operations, debt, litigation, and 5G network commitments [Management's Narrative Analysis of Results of Operations](index=78&type=section&id=Item%202.%20Management%27s%20Narrative%20Analysis%20of%20Results%20of%20Operations) Management discusses the pending Pay-TV sale, asset transfers, segment performance, and future capital needs, expecting continued negative cash flow [Overview and Recent Developments](index=78&type=section&id=Overview%20and%20Recent%20Developments) This section details the pending Pay-TV sale, asset transfers to EchoStar, and integration efforts for synergy realization - On September 29, 2024, an agreement was made to sell the Pay-TV business (DISH DBS) to DIRECTV for **$1.00** plus the assumption of net debt, though the DISH DBS Exchange Offers subsequently failed[290](index=290&type=chunk)[295](index=295&type=chunk) - In Q1 2024, the company completed significant asset transfers to its parent, EchoStar, including wireless spectrum licenses and the EchoStar XXV satellite, with a historical net carrying value of **$12.0 billion**[297](index=297&type=chunk)[298](index=298&type=chunk) - The company is focused on integrating with EchoStar, its parent company since December 31, 2023, to realize synergies and cost savings[303](index=303&type=chunk)[304](index=304&type=chunk) [Future Capital Requirements, Economic Environment, and Liquidity](index=82&type=section&id=Future%20Capital%20Requirements%2C%20Economic%20Environment%2C%20and%20Liquidity) Management anticipates substantial future capital needs for 5G deployment, expects continued negative cash flow, and notes inflationary pressures - The company expects to continue experiencing negative cash flow in **2024** and beyond due to **5G** network deployment costs, litigation expenses, and declines in its Pay-TV and Wireless subscriber bases[321](index=321&type=chunk) - Future capital requirements are substantial, driven by the **5G** network build-out, potential spectrum purchases, and subscriber acquisition costs, which may not be available on favorable terms[314](index=314&type=chunk)[316](index=316&type=chunk) - The company has experienced inflationary pressures in commodity and labor costs, which have significantly impacted overall operating results[318](index=318&type=chunk) [Explanation of Key Metrics and Other Items](index=85&type=section&id=Explanation%20of%20Key%20Metrics%20and%20Other%20Items) This section defines key business metrics, including Pay-TV and Retail Wireless subscriber metrics, ARPU, churn, SAC, and non-GAAP measures - Pay-TV ARPU is calculated by dividing Pay-TV service revenue (excluding broadband) by the average number of Pay-TV subscribers, with an increase in SLING TV subscribers negatively impacting this metric[339](index=339&type=chunk) - DISH TV SAC includes all acquisition costs (advertising, installation, commissions) plus capitalized equipment, divided by gross new DISH TV subscriber activations[341](index=341&type=chunk) - Wireless churn rate is calculated by dividing terminated subscribers by the average number of subscribers, excluding government-subsidized subscriber additions[345](index=345&type=chunk) [Results of Operations – Segments](index=89&type=section&id=Results%20of%20Operations%20%E2%80%93%20Segments) Consolidated revenue decreased in Q3 2024, leading to a widened operating loss, primarily from 5G Network Deployment Segment Revenue and Operating Income (Loss) - Q3 2024 vs Q3 2023 (in thousands) | Segment | Revenue Q3 2024 | Revenue Q3 2023 | Operating Income (Loss) Q3 2024 | Operating Income (Loss) Q3 2023 | | :--- | :--- | :--- | :--- | :--- | | Pay-TV | $2,618,031 | $2,807,101 | $588,501 | $589,465 | | Retail Wireless | $895,949 | $890,980 | $(113,792) | $(168,166) | | 5G Network Deployment | $42,833 | $29,916 | $(599,022) | $(463,105) | | **Total** | **$3,515,317** | **$3,704,516** | **$(124,500)** | **$(41,806)** | Segment Revenue and Operating Income (Loss) - Nine Months 2024 vs 2023 (in thousands) | Segment | Revenue 9M 2024 | Revenue 9M 2023 | Operating Income (Loss) 9M 2024 | Operating Income (Loss) 9M 2023 | | :--- | :--- | :--- | :--- | :--- | | Pay-TV | $8,020,893 | $8,754,372 | $1,926,541 | $1,985,490 | | Retail Wireless | $2,693,330 | $2,794,087 | $(309,571) | $(298,872) | | 5G Network Deployment | $106,653 | $67,902 | $(1,747,262) | $(1,198,667) | | **Total** | **$10,723,476** | **$11,573,075** | **$(130,292)** | **$487,951** | [Other Consolidated Results](index=117&type=section&id=Other%20Consolidated%20Results) Q3 2024 saw a significant increase in net interest expense, a positive swing in 'Other, net' income, and a net loss - Interest expense, net of amounts capitalized, increased by **$150 million** in Q3 2024 compared to Q3 2023, primarily due to less interest capitalization as **5G** network assets were placed into service and after asset transfers to EchoStar[462](index=462&type=chunk)[463](index=463&type=chunk) - For the nine months ended Sep 30, 2024, 'Other, net' income was **$81 million**, positively impacted by a **$128 million** gain on an asset sale to EchoStar and a **$21 million** gain on the Liberty Puerto Rico asset sale, partially offset by a **$70 million** loss in equity earnings from the Invidi investment[471](index=471&type=chunk) [Non-GAAP Performance Measures and Reconciliation](index=121&type=section&id=Non-GAAP%20Performance%20Measures%20and%20Reconciliation) The company provides reconciliations for non-GAAP measures, with consolidated EBITDA increasing in Q3 2024 Consolidated EBITDA Reconciliation (in thousands) | Metric | Q3 2024 | Q3 2023 | Nine Months 2024 | Nine Months 2023 | | :--- | :--- | :--- | :--- | :--- | | **Net income (loss) attributable to DISH Network** | $(210,523) | $(139,185) | $(436,251) | $283,843 | | Interest, net | 151,998 | (8,476) | 464,027 | (63,528) | | Income tax provision (benefit), net | (47,971) | (67,988) | (80,872) | 81,930 | | Depreciation and amortization | 364,199 | 294,797 | 1,122,383 | 806,504 | | **Consolidated EBITDA** | **$257,703** | **$79,148** | **$1,069,287** | **$1,108,749** | Segment OIBDA - Q3 2024 (in thousands) | Segment | Operating Income (Loss) | Depreciation & Amortization | OIBDA | | :--- | :--- | :--- | :--- | | Pay-TV | $588,501 | $87,502 | $676,003 | | Retail Wireless | $(113,792) | $23,037 | $(90,755) | | 5G Network Deployment | $(599,022) | $269,529 | $(329,493) | [Controls and Procedures](index=123&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were effective, with no material changes in internal control over financial reporting - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of the end of the reporting period[480](index=480&type=chunk) - No changes occurred in internal control over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, these controls[481](index=481&type=chunk) PART II — OTHER INFORMATION [Legal Proceedings](index=123&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 9 of the financial statements for detailed information on ongoing legal proceedings - For information on legal proceedings, the report directs readers to Note 9 of the financial statements[482](index=482&type=chunk) [Risk Factors](index=123&type=section&id=Item%201A.%20Risk%20Factors) This section updates risk factors, focusing on the pending DIRECTV Transaction's potential for termination, delays, and disruptions - Termination of the DIRECTV Transaction could lead to adverse consequences, including negative reactions from financial markets, customers, and other stakeholders[484](index=484&type=chunk) - Completion of the DIRECTV Transaction is subject to uncertain conditions, including governmental approvals and the successful exchange of DISH DBS Notes, which could delay or prevent closing[487](index=487&type=chunk)[489](index=489&type=chunk) - The company is subject to restrictive covenants in the Purchase Agreement that limit its business activities, such as paying dividends, making certain investments, or incurring debt, prior to the transaction's completion[501](index=501&type=chunk)[502](index=502&type=chunk) - The announcement and pendency of the transaction could disrupt business operations, affecting relationships with customers, suppliers, and employees, and divert significant management resources[497](index=497&type=chunk)[499](index=499&type=chunk) [Exhibits](index=128&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including key agreements for the DIRECTV transaction and financing - Exhibit **2.1**: Equity Purchase Agreement with DIRECTV Holdings, LLC[509](index=509&type=chunk) - Exhibit **10.1**: Loan and Security Agreement for the **$2.5 billion** New DISH DBS Financing[509](index=509&type=chunk) - Exhibit **10.2**: Transaction Support Agreement with certain creditors for the exchange of convertible notes[509](index=509&type=chunk) [Signatures](index=129&type=section&id=Signatures) The Form 10-Q report was signed by the company's CEO, CFO, and Chief Accounting Officer on November 14, 2024 - The report was signed on November 14, 2024, by Hamid Akhavan (CEO), Paul W Orban (CFO), and James S Allen (Chief Accounting Officer)[512](index=512&type=chunk)

Core Viewpoint - DirecTV has decided to terminate its planned acquisition of EchoStar's video distribution service, DISH DBS, due to the rejection of a debt exchange offer by DISH bondholders [1][2]. Group 1: Acquisition Details - DirecTV announced in September that it would acquire DISH DBS for $1, which included assuming $9.75 billion of DISH's debt [2]. - A successful debt exchange was a condition for the acquisition, and the rejection of the offer has forced DirecTV to walk away from the deal by the deadline of November 22 [2][3]. Group 2: Market Context - The proposed merger was viewed as a strategic move in a declining pay-TV market, where both DirecTV and DISH are facing increased competition from streaming services [4]. - Streaming services have become more popular due to their on-demand nature and internet accessibility, leading to a decline in traditional satellite TV subscriptions [4]. Group 3: Financial Implications - The rejected debt exchange involved a "haircut" of $1.5 billion for DISH bondholders, which they did not accept [3]. - EchoStar, co-founded by Charlie Ergen, is currently burdened with over $20 billion in debt, making the merger critical for its financial health [5].

Core Viewpoint - The merger between DirecTV and Echostar's Video Distribution business, including Dish TV and Sling TV, is anticipated to create a stronger competitive force in the U.S. video industry, which is increasingly dominated by streaming services [1][2]. Group 1: Merger Details - DirecTV announced the acquisition of Dish/Sling for $1.00 while assuming Echostar's $9.75 billion debt [1]. - The merger will require government approval, with expectations that it will be approved by Q4 2025 [1][3]. - The combined entity will have over 18 million subscribers, making it the largest pay-TV provider, surpassing Comcast and Charter Communications [3]. Group 2: Industry Context - The pay-TV industry has seen a significant decline, with DirecTV and Dish losing 63% of their subscriber counts since 2016 [3]. - In 2023, DirecTV lost 1.8 million subscribers, while Dish lost 945,000 subscribers [3]. - The merger is expected to provide more negotiating power for carriage fee renewals with linear TV networks and SVOD providers [4]. Group 3: Financial Implications - The combined companies are projected to save at least $1 billion annually [5]. - EchoStar is expected to be in a stronger financial position to enhance its 5G network, benefiting its customers and stakeholders [6]. - TPG, a private equity partner, will acquire the remaining 70% of DirecTV from AT&T for $7.6 billion, marking AT&T's exit from the television industry [6][7]. Group 4: Historical Context - This merger follows a previous attempt in 2002 that was blocked by regulators due to competition concerns [1][8]. - The merger of satellite providers is not unprecedented, as seen in the 2008 merger of Sirius Satellite and XM Satellite Radio [8].

Group 1: Merger Considerations - EchoStar Corporation's subsidiary DISH TV is exploring a merger with AT&T's DirecTV, with discussions still in early stages and no agreement reached [1] - A merger between DirecTV and Dish could reshape the pay-TV market, potentially stabilizing subscriber bases in a streaming-dominated environment [2][3] - The combined subscriber base of the two companies could reach approximately 20 million, enhancing market strength [3] Group 2: Regulatory Environment - A merger of this scale is expected to face significant scrutiny from U.S. regulators, particularly concerning antitrust issues, as a previous merger attempt was blocked in 2002 [4] - There is speculation that the current industry changes may allow the deal to pass regulatory scrutiny this time [5] Group 3: Company Performance - EchoStar Corporation reported a 9% year-over-year decline in revenues to $3.96 billion, missing consensus estimates by 0.6% [6] - The company is experiencing net subscriber losses in its Pay-TV, Retail Wireless, and Broadband services, which are negatively impacting its top-line performance [6] - Currently, EchoStar has a Zacks Rank of 5 (Strong Sell), although its shares have increased by 44.2% over the past year, contrasting with a 13.8% decline in the sub-industry [7]

[PART I — FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20%E2%80%94%20FINANCIAL%20INFORMATION) [Disclosure Regarding Forward-Looking Statements](index=4&type=section&id=Disclosure%20Regarding%20Forward-Looking%20Statements) Forward-looking statements are subject to risks and uncertainties, with actual results potentially differing materially due to factors like the EchoStar merger and competition - The company identifies key risk categories that could cause actual results to differ from forward-looking statements, including risks related to the **merger with EchoStar**, **intense competition** in Pay-TV and Wireless, **operational performance**, reliance on third-party providers, **cybersecurity threats**, **substantial debt**, and the **need for additional capital**[5](index=5&type=chunk)[6](index=6&type=chunk)[7](index=7&type=chunk) [Item 1. Financial Statements](index=8&type=section&id=Item%201.%20Financial%20Statements) The financial statements reveal a significant decline in financial position, with assets decreasing, liabilities increasing, and a net loss, raising substantial doubt about the company's going concern ability Condensed Consolidated Balance Sheet Summary (As of June 30, 2024 vs. Dec 31, 2023) | Balance Sheet Item | June 30, 2024 (in thousands) | December 31, 2023 (in thousands) | | :--- | :--- | :--- | | **Total Current Assets** | $2,008,471 | $2,343,661 | | **Total Assets** | $43,286,892 | $51,413,031 | | **Total Current Liabilities** | $6,666,654 | $7,592,166 | | **Total Liabilities** | $41,782,948 | $34,182,475 | | **Total Stockholder's Equity (Deficit)** | $1,503,944 | $16,792,174 | Condensed Consolidated Statements of Operations Summary | Income Statement Item (in thousands) | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--- | :--- | :--- | :--- | :--- | | **Total Revenue** | $3,568,270 | $3,911,577 | $7,208,159 | $7,868,559 | | **Operating Income (Loss)** | $(31,771) | $206,334 | $(5,792) | $529,757 | | **Net Income (Loss)** | $(211,824) | $222,424 | $(222,055) | $465,662 | | **Net Income (Loss) Attributable to DISH Network** | $(211,849) | $200,323 | $(225,728) | $423,028 | Condensed Consolidated Statements of Cash Flows Summary (Six Months Ended) | Cash Flow Item (in thousands) | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--- | :--- | :--- | | **Net cash flows from operating activities** | $703,711 | $1,349,816 | | **Net cash flows from investing activities** | $161,532 | $(2,054,511) | | **Net cash flows from financing activities** | $(1,000,883) | $(42,072) | - The company states that **substantial doubt** exists about its ability to continue as a **going concern**, lacking cash for Q4 2024 operations or the **$1.983 billion debt maturing in November 2024**, and is actively discussing funding sources[32](index=32&type=chunk)[33](index=33&type=chunk) [Note 1: Organization and Business Activities](index=12&type=section&id=Note%201.%20Organization%20and%20Business%20Activities) DISH Network operates Pay-TV, Retail Wireless, and 5G Network Deployment segments, with significant early 2024 asset transfers to EchoStar, and management concluding **substantial doubt** about its **going concern** ability - On **January 10, 2024**, DISH transferred **significant assets** to its parent, EchoStar, including wireless spectrum licenses and the EchoStar XXV satellite, with a net carrying value of **$12.003 billion**, recorded as a dividend, and assigned a **$4.7 billion intercompany loan** to EchoStar[25](index=25&type=chunk)[26](index=26&type=chunk) - On **March 12, 2024**, DISH sold its **700 MHz spectrum** to EchoStar for approximately **$1.037 billion**, using the proceeds to repay the **$951 million** balance on its 2 3/8% Convertible Note[28](index=28&type=chunk) - As of **June 30, 2024**, the company had **8.074 million Pay-TV subscribers** (6.076 million DISH TV and 1.998 million SLING TV) and **7.281 million Wireless subscribers**[36](index=36&type=chunk)[38](index=38&type=chunk) [Note 8: Long-Term Debt and Finance Lease Obligations](index=34&type=section&id=Note%208.%20Long-Term%20Debt%20and%20Finance%20Lease%20Obligations) As of June 30, 2024, DISH reported approximately **$25.0 billion** in long-term debt, including a **$1.983 billion** maturity in November 2024 and a **$4.7 billion** intercompany loan to EchoStar, with fair values significantly below carrying amounts Long-Term Debt Summary (as of June 30, 2024) | Debt Instrument | Issuer | Carrying Amount (in thousands) | Fair Value (in thousands) | | :--- | :--- | :--- | :--- | | 5 7/8% Senior Notes due 2024 | DDBS | $1,982,544 | $1,885,796 | | 0% Convertible Notes due 2025 | DISH | $1,957,197 | $1,416,091 | | 3 3/8% Convertible Notes due 2026 | DISH | $2,908,799 | $1,827,540 | | Intercompany Loan 2026 Tranche | DISH | $4,767,289 | $4,767,289 | | **Total Long-Term Debt & Finance Lease Obligations** | | **$24,986,948** | **$19,624,639 (debt only)** | - In **January 2024**, a **$4.7 billion intercompany loan tranche** was assigned to parent company EchoStar, making it an **external obligation** of DISH Network to its parent[99](index=99&type=chunk)[114](index=114&type=chunk) [Note 9: Commitments and Contingencies](index=40&type=section&id=Note%209.%20Commitments%20and%20Contingencies) The company faces significant 5G network deployment commitments requiring additional capital for 2025, potential liabilities from the AWS-3 auction up to **$1.892 billion**, and ongoing litigation including patent infringement and a data breach class action - The company has **met its 2023/2024 5G deployment commitments**, covering **over 200 million Americans** with 5G VoNR, but will need to **raise additional capital** to meet its **June 14, 2025 final build-out requirements**[41](index=41&type=chunk)[119](index=119&type=chunk) - The company faces a **potential liability** from the **AWS-3 auction**, where Northstar Wireless could owe up to approximately **$1.892 billion** and SNR Wireless up to approximately **$1.029 billion** depending on re-auction outcomes[124](index=124&type=chunk)[126](index=126&type=chunk) - DISH is a defendant in **multiple patent infringement lawsuits** from entities like ClearPlay and TQ Delta, concerning features like AutoHop™ and satellite technologies, with many cases ongoing and **uncertain outcomes**[138](index=138&type=chunk)[145](index=145&type=chunk)[177](index=177&type=chunk) - A **class action lawsuit** was filed against the company related to a **February 2023 cybersecurity incident**, alleging deficient security and failure to protect customer data, with an **uncertain outcome and potential liability**[140](index=140&type=chunk)[149](index=149&type=chunk) [Note 10: Segment Reporting](index=61&type=section&id=Note%2010.%20Segment%20Reporting) For Q2 2024, Pay-TV generated **$668 million** operating income on **$2.68 billion** revenue, while Retail Wireless and 5G Network Deployment segments posted widening operating losses Segment Performance (Three Months Ended June 30, 2024 vs 2023) | Segment | Revenue 2024 (in thousands) | Revenue 2023 (in thousands) | Operating Income (Loss) 2024 (in thousands) | Operating Income (Loss) 2023 (in thousands) | | :--- | :--- | :--- | :--- | :--- | | Pay-TV | $2,676,284 | $2,975,140 | $667,797 | $720,792 | | Retail Wireless | $891,531 | $928,241 | $(121,362) | $(112,499) | | 5G Network Deployment | $34,892 | $19,079 | $(578,206) | $(401,959) | Segment Performance (Six Months Ended June 30, 2024 vs 2023) | Segment | Revenue 2024 (in thousands) | Revenue 2023 (in thousands) | Operating Income (Loss) 2024 (in thousands) | Operating Income (Loss) 2023 (in thousands) | | :--- | :--- | :--- | :--- | :--- | | Pay-TV | $5,402,862 | $5,947,271 | $1,338,040 | $1,396,025 | | Retail Wireless | $1,797,381 | $1,903,107 | $(195,779) | $(130,706) | | 5G Network Deployment | $63,820 | $37,986 | $(1,148,240) | $(735,562) | [Management's Narrative Analysis of Results of Operations](index=73&type=section&id=Item%202.%20Management%27s%20Narrative%20Analysis%20of%20Results%20of%20Operations) Management discusses declining consolidated revenue and operating losses driven by subscriber losses and 5G network investments, reiterating **substantial doubt** about the company's **going concern** ability and urgent need for capital - Management reiterates the **going concern issue**, stating the company lacks cash for Q4 2024 operations or the **$1.983 billion debt maturing in November 2024**, and is actively discussing options to **raise additional capital**[247](index=247&type=chunk)[255](index=255&type=chunk) - The company highlights **significant asset sales and transfers** to its parent, **EchoStar**, in **early 2024**, including wireless spectrum licenses and a satellite, executed to **manage capital and debt obligations**[233](index=233&type=chunk)[234](index=234&type=chunk)[236](index=236&type=chunk) - The company **achieved its 5G network deployment milestone**, covering **over 200 million Americans** with VoNR, but **capital expenditures are expected to increase** to meet 2025 build-out requirements[245](index=245&type=chunk)[253](index=253&type=chunk) [Pay-TV Segment Analysis](index=84&type=section&id=Pay-TV%20Segment%20Analysis) The Pay-TV segment faces intense competition, leading to subscriber decline, though Q2 2024 net losses improved to **104,000**, with revenue decreasing **10.0%** to **$2.68 billion** and operating income falling **7.4%** Pay-TV Key Metrics (Q2 2024 vs Q2 2023) | Metric | Q2 2024 | Q2 2023 | Change | | :--- | :--- | :--- | :--- | | Net Subscriber Losses (in millions) | (0.104) | (0.294) | +64.6% | | DISH TV Net Losses (in millions) | (0.182) | (0.197) | +7.6% | | SLING TV Net Additions (Losses) (in millions) | 0.078 | (0.097) | N/A | | Pay-TV ARPU | $108.42 | $104.07 | +4.2% | | DISH TV Churn Rate | 1.39% | 1.51% | -0.12 pts | | DISH TV SAC | $938 | $1,169 | -19.8% | - Competition remains **intense** from established providers and direct-to-consumer streaming services, leading to **cord-cutting and cord-shaving**, with **programming costs expected to continue increasing**[285](index=285&type=chunk)[291](index=291&type=chunk) - The **decrease in gross new DISH TV subscriber activations (down 36.7% YoY)** was attributed to lack of demand, shifting consumer behavior, lower marketing spend, and emphasis on higher-quality subscribers[301](index=301&type=chunk) [Retail Wireless Segment Analysis](index=97&type=section&id=Retail%20Wireless%20Segment%20Analysis) The Retail Wireless segment improved Q2 2024 net subscriber losses to **16,000** due to a lower churn rate of **2.93%**, but faces challenges from a widening operating loss of **$121 million** and the conclusion of the ACP program Retail Wireless Key Metrics (Q2 2024 vs Q2 2023) | Metric | Q2 2024 | Q2 2023 | Change | | :--- | :--- | :--- | :--- | | Net Subscriber Losses (in millions) | (0.016) | (0.188) | +91.5% | | Gross Subscriber Additions (in millions) | 0.606 | 0.711 | -14.8% | | Wireless Churn Rate | 2.93% | 4.54% | -1.61 pts | | Wireless ARPU | $35.91 | $36.37 | -1.3% | - The **federal Affordable Connectivity Program (ACP) funding concluded on June 1, 2024**, impacting approximately **387,000 ACP subscribers**, with a **risk of deactivation** in the second half of 2024 despite migration efforts[328](index=328&type=chunk) - The **significant drop in the wireless churn rate** was positively impacted by the **completion of a subscriber migration** off T-Mobile's TSA systems and a **strategic focus on acquiring and retaining higher-quality subscribers**[327](index=327&type=chunk)[338](index=338&type=chunk) [5G Network Deployment Segment Analysis](index=105&type=section&id=5G%20Network%20Deployment%20Segment%20Analysis) The 5G Network Deployment segment reported a Q2 2024 operating loss of **$578 million**, a **43.8%** increase, driven by higher operating costs and depreciation, requiring more capital for 2025 build-out 5G Network Deployment Financials (Q2 2024 vs Q2 2023) | Financial Item (in thousands) | Q2 2024 | Q2 2023 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $34,892 | $19,079 | +82.9% | | Total Costs and Expenses | $613,098 | $421,038 | +45.6% | | Operating Loss | $(578,206) | $(401,959) | -43.8% | | OIBDA | $(312,286) | $(278,475) | -12.1% | - **Operating costs increased** primarily due to **higher lease expenses** for communication towers and other **network-related costs** as deployment expands, with certain personnel costs reclassified from SG&A to Cost of Services[361](index=361&type=chunk) - **Depreciation and amortization expense increased by $142 million YoY** as more 5G network assets were placed into service, and this expense is **expected to continue increasing** as the buildout progresses[362](index=362&type=chunk) [Controls and Procedures](index=114&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded the company's disclosure controls and procedures were effective as of June 30, 2024, with no material changes to internal control over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were **effective** as of the end of the reporting period[384](index=384&type=chunk) - **No changes in internal control over financial reporting** occurred during the quarter that have materially affected, or are reasonably likely to materially affect, these controls[385](index=385&type=chunk) [PART II — OTHER INFORMATION](index=114&type=section&id=PART%20II%20%E2%80%94%20OTHER%20INFORMATION) [Legal Proceedings](index=114&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 9 of the Condensed Consolidated Financial Statements for detailed information regarding the company's ongoing legal proceedings - For information regarding legal proceedings, the report directs readers to **Note 9, "Commitments and Contingencies – Contingencies – Litigation"** in the financial statements[386](index=386&type=chunk) [Risk Factors](index=114&type=section&id=Item%201A.%20Risk%20Factors) This section incorporates by reference the detailed discussion of risk factors from the company's most recent Annual Report on Form 10-K for the year ended December 31, 2023 - The report **incorporates by reference** the detailed discussion of risk factors from the company's most recent **Annual Report on Form 10-K**[387](index=387&type=chunk) [Exhibits](index=114&type=section&id=Item%206.%20Exhibits) The report lists filed exhibits, including Section 302 and 906 certifications by the CEO and CFO, and financial statements formatted in iXBRL - Filed exhibits include **CEO and CFO certifications** as required by **Sarbanes-Oxley Sections 302 and 906**, as well as **iXBRL data files** for the financial statements[388](index=388&type=chunk) [Signatures](index=115&type=section&id=Signatures) The report was duly authorized and signed on **August 13, 2024**, by the President and CEO, EVP and CFO, and SVP and Chief Accounting Officer - The Form 10-Q was signed on **August 13, 2024**, by the company's **CEO, CFO, and Chief Accounting Officer**[390](index=390&type=chunk)