EchoStar Announces Financial Results for the Three Months Ended March 31, 2023

Englewood, CO, May 8, 2023—EchoStar Corporation (Nasdaq: SATS) announced its financial results for the three months ended March 31, 2023.

Three Months Ended March 31, 2023 Financial Highlights:

• Consolidated revenue of $439.6 million.
• Net income of $27.8 million, consolidated net income attributable to EchoStar common stock of $29.0 million, and basic and diluted earnings per share of common stock of $0.35.
• Consolidated Adjusted EBITDA of $135.0 million (see discussion and the reconciliation of GAAP to this non-GAAP measure below).

“In the first quarter of 2023, the EchoStar team performed as planned, with a focus on optimizing our existing assets and market opportunities efficiently,” said Hamid Akhavan, CEO and President of EchoStar. “The business continues to pursue new avenues of growth, laying the operational foundation to drive increased revenues once our upcoming EchoStar XXIV/JUPITER™ 3 satellite enters into service and taking tangible steps toward fulfilling our vision of a global 5G network in the S-band.”

Three Months Ended March 31, 2023 – Additional Information:

• Consolidated revenue decreased 12.3% or $61.9 million year over year.  The decrease was driven by lower service revenues of $41.3 million partially due to fewer broadband customers.  Equipment sales decreased $20.7 million, primarily due to lower sales to both domestic and international enterprise customers.
• Net income decreased $61.1 million year over year.  The decrease was due to lower  operating income of $16.8 million and an unfavorable change in investments of $87.8 million due to $80.7 million of gains that occurred in 2022. These items were partially offset by a favorable change in interest income of $22.2 million and lower net income tax expense of $21.3 million.
• Adjusted EBITDA decreased 18.6% or $30.9 million year over year.
  • Hughes segment Adjusted EBITDA decreased $30.1 million year over year. The decrease was driven primarily by lower service and equipment revenue, partially offset by lower sales and marketing expense for our broadband consumer business.
  • ESS segment Adjusted EBITDA increased $2.0 million year over year primarily due to higher revenue.
  • Corporate and Other segment Adjusted EBITDA decreased $2.7 million year over year. The decrease was primarily due to higher corporate expenses, partially offset by higher earnings of unconsolidated affiliates, net, of $0.4 million.
• Hughes broadband subscribers totaled approximately 1,177,000, declining 51,000 from December 31, 2022.  Our current capacity limitations, increasing bandwidth usage by approximately 15% year on year on average by our existing U.S subscribers, and competitive pressures are impacting our consumer subscriber levels.  In Latin America, subscriber levels were tempered by our focus on more profitable consumer segments and by our allocation of capacity to enterprise opportunities.
• For the three months ended March 31, 2023, approximately 37% of Hughes segment revenue was attributable to our enterprise customers, increasing from 36% in the same period last year.
• Cash, cash equivalents and current marketable investment securities were $1.7 billion as of March 31, 2023.
• The JUPITER 3/EchoStar XXIV satellite is currently expected to be shipped to the launch site in June and subsequently launched at the first window that SpaceX can allocate to it, which is subject to preemption by certain higher-priority government launches.

Set forth below is a table highlighting certain of EchoStar’s segment results for the three months ended  March 31, 2023 and 2022 (amounts in thousands) (all US GAAP amounts reference results from operations):