DirecTV on Thursday confirmed its interest in potentially bidding for online video site Hulu, as the satellite TV provider reported that its second-quarter profit surged 29 percent to $701 million over the same period a year ago.
DirecTV Chairman Mike White verified that the company is looking at Hulu, which enables its users to watch television shows and other entertainment over the Web. Hulu has been seeking to sell itself and has reportedly drawn the interest of several high-profile companies that want to capitalize on the rapid growth of online video services like Hulu and Netflix.
Meantime, DirecTV announced that it has surpassed 30 million customers since the company launched services in 1994. At least one Wall Street firm, Deutsche Bank Securities, is bullish on the company’s prospects.
“DTV remains a growth leader … and is well positioned, in our view, with its higher-end customer base, strong credit standards, leading brand, advantaged distribution and very fast growing" segment in Latin America, Deutsche Bank wrote in a research note Friday.
In the second quarter, revenues at DirecTV rose 13 percent to $6.60 billion, thanks partially to strong growth in Latin America. The company’s segment in Latin America added 472,000 subscribers, reflecting 14 percent growth over the second quarter of 2010, ending the period with 10.29 million customers.
Growth in the United States, however, slowed. El Segundo, Calif.-based DirecTV only added about one-quarter the number of customers (26,000) as it had in the same period a year ago (100,000). Average monthly churn – reflecting the percentage of customers who cancel service – also rose year over year from 1.51 percent to 1.59 percent.
DirecTV largely attributed the higher churn to “a more competitive environment coupled with ongoing economic weakness."
The company ended the quarter with 19.43 million U.S. customers.
