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DISH Network (DISH -32%) is rapidly losing its connection with investors, selling off to multi-decade lows today following its Q3 report. Today's glaring headline was DISH's surprise net loss in the quarter, registering EPS of $(0.26), a striking reversal from the $0.31 figure delivered last quarter. DISH is amid plenty of change, with a pending combination with EchoStar (SATS) and a spectrum purchase agreement with T-Mobile (TMUS). With a 5G deadline continuing to loom, losses starting to pile up, and significant changes on the horizon, investors are fleeing from DISH, reflecting extraordinary uncertainty surrounding whether the long-established satellite services provider can avoid bankruptcy.

• What happened that led to the surprise loss? A few factors were at play, including higher marketing expenses, a change in commission structure, and elevated equipment costs as a higher percentage of handsets on DISH's 5G were deployed.
• Part of the problem with wireless was last year's dispute with TMUS, leading to T-Mobile shutting down its 3G CDMA network, causing DISH to replace these customers' handsets with new, compatible ones. Unfortunately, given the timing, these phones were not compatible with DISH's current network, causing another replacement cycle this year, eating into profitability. Also not helping matters is that wireless continued to hemorrhage subscribers in Q3, down 3% sequentially, an acceleration from the 2% drop qtr/qtr in Q2.
• Marketing is also not translating to much benefit. Recall that DISH partnered with Amazon (AMZN) this past summer, offering wireless service to Prime subscribers at $25 monthly. Although a competitive price point, awareness is not high, making marketing efforts seem futile. After conceding that it is not doing a great marketing job, DISH noted that it is working with AMZN to improve the overall storefront presentation. As such, perhaps numbers will improve in subsequent quarters as more Prime members become aware of the attractively priced phone service.
• Meanwhile, pay-TV remains a vanishing medium, with cord-cutting the central theme amongst TV-goers. This trend is reflected in DISH's subscriber growth, falling by 1% sequentially in Q3, following a 3% drop in Q2. Despite being a less popular aspect of DISH, given its emphasis on meeting its 5G deadline, pay-TV remains a critical component of cash flow. As a result, it will be crucial for DISH to stop bleeding pay-TV customers.

Bottom line, DISH's Q3 net loss was startling. Its wireless service marketing efforts are falling short while its pay-TV subscribers are fading. Its Q3 report did not change the fact that DISH continues staring at an extensive uphill battle as it takes on giants in its respective industries.