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Table of Contents
Year Ended December 31, 2005 Compared to the Year Ended December 31, 2004.
50
Item 7.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS —
Continued
For the Years Ended December 31,
Variance
2005
2004
Amount
%
(In thousands)
Statements of Operations Data
Revenue:
Subscriber
-
related revenue
$
7,986,394
$
6,692,949
$
1,293,445
19.3
Equipment sales
367,968
364,929
3,039
0.8
Other
92,813
100,593
(7,780
)
(7.7
)
Total revenue
8,447,175
7,158,471
1,288,704
18.0
Costs and Expenses:
Subscriber
-
related expenses
4,095,986
3,618,259
477,727
13.2
% of Subscriber
-
related revenue
51.3
%
54.1
%
Satellite and transmission expenses
134,545
112,239
22,306
19.9
% of Subscriber
-
related revenue
1.7
%
1.7
%
Cost of sales
—
equipment
271,697
259,058
12,639
4.9
% of Equipment sales
73.8
%
71.0
%
Cost of sales
—
other
23,339
33,265
(9,926
)
(29.8
)
Subscriber acquisition costs
1,492,581
1,527,886
(35,305
)
(2.3
)
General and administrative
456,206
398,898
57,308
14.4
% of Total revenue
5.4
%
5.6
%
Depreciation and amortization
805,573
505,561
300,012
59.3
Total costs and expenses
7,279,927
6,455,166
824,761
12.8
Operating income (loss)
1,167,248
703,305
463,943
66.0
Other income (expense):
Interest income
43,518
42,287
1,231
2.9
Interest expense, net of amounts capitalized
(373,844
)
(505,732
)
131,888
26.1
Gain on insurance settlement
134,000
—
134,000
NM
Other
36,169
(13,482
)
49,651
NM
Total other income (expense)
(160,157
)
(476,927
)
316,770
66.4
Income (loss) before income taxes
1,007,091
226,378
780,713
NM
Income tax benefit (provision), net
507,449
(11,609
)
519,058
NM
Net income (loss)
$
1,514,540
$
214,769
$
1,299,771
NM
Other Data:
DISH Network subscribers, as of period end (in millions)
12.040
10.905
1.135
10.4
DISH Network subscriber additions, gross (in millions)
3.397
3.441
(0.044
)
(1.3
)
DISH Network subscriber additions, net (in millions)
1.135
1.480
(0.345
)
(23.3
)
Average monthly subscriber churn rate
1.65
%
1.62
%
0.03
%
1.9
Average monthly revenue per subscriber (
“
ARPU
”
)
$
58.04
$
55.00
$
3.04
5.5
Average subscriber acquisition costs per subscriber (
“
SAC
”
)
$
693
$
611
$
82
13.4
EBITDA
$
2,142,990
$
1,195,384
$
947,606
79.3