EchoStar Corp. announced Thursday that it has created a new division called EchoStar Capital to invest the $45 billion the company has generated from the sale of its wireless spectrum.
EchoStar founder and chairman Charlie Ergen will take over as president and CEO of EchoStar Corp., putting him in charge of the operations of the pay television and wireless business units. Former EchoStar CEO Hamid Akhavan will head up the new investment arm.
“This is an opportune moment in time for our business to go on the offense as we build upon our 45-year institutional heritage and forge a new path forward for creating and developing opportunities in our strategic expertise domains that will provide attractive value creation for EchoStar and its shareholders,” Akhavan said in a news release.
The third quarter was a huge one in terms of redefining the company and its future. AT&T agreed to pay $22.65 billion in cash and SpaceX agreed to pay $19 billion for wireless spectrum that the Douglas County company had acquired over the years.
EchoStar had intended to deploy the spectrum to build out its Boost Mobile wireless network and private 5G networks for commercial customers. But the company wasn’t moving fast enough for the Federal Communications Commission, which had put pressure on it to use its spectrum or sell it. EchoStar agreed to sell the bulk of its spectrum and to rely on AT&T’s network to carry most of its wireless traffic going forward.
Although the choicest slices of spectrum have been claimed, the company announced on Thursday that it had reached an agreement to sell additional AWS-3 wireless spectrum to SpaceX for $2.6 billion worth of its shares.
A portion of the spectrum sale proceeds will go to pay down debt, but increasingly it is looking like the company will invest most of it to create future earnings for shareholders, who have seen a more than doubling in the company’s share price this year. EchoStar is one of the top-performing stocks this year, not including AI-related companies.
EchoStar reported $38.2 billion in liabilities at the end of the third quarter, down from $40.7 billion at the end of last year. Analysts said the company is now in a “net cash” position, meaning it has more cash and other liquid assets than it has debt.
That said, the company continues to struggle with declining subscriptions in DISH TV, its core satellite television business, which has lost 12.2% of its customer base over the past year. Sling TV, the over-the-internet alternative, fared better, gaining 159,900 subscribers, bringing the total number of pay television subscribers to 7.17 million.
The wireless side, consisting mostly of Boost Mobile, continued to grow, adding 223,000 new customers in the third quarter and generating $939 million in revenues. Boost Mobile is now larger than the pay-TV side with 7.52 million subscribers, although the monthly bill each subscriber is paying is smaller.
EchoStar took a $16.5 billion one-time charge to account for the impaired value on the portions of its 5G network that it won’t be using as a result of the agreement reached with AT&T. That noncash write-off contributed to a $12.8 billion loss in the third quarter, which compares to a $141.8 million loss in the third quarter of 2024.
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