EchoStar Corporation

Welcome to the ECHO Star Corporation Second Quarter 2025 Earnings Conference Call. At this time, all participants are in listen-only mode. The question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero from your telephone keypad. Please note that this conference is being recorded. At this time, I'll now turn the conference over to Dean Manson, Chief Legal Officer. Dean, you may begin.

Thank you. And welcome to Echostar's second quarter 2025 earnings call. We will begin with opening remarks from Hamid Akhavan, President and CEO, followed by Paul Orban, EVP and Principal Financial Officer, and John Swearinger, President of Technology and COO. We request that any participant producing a report not identify other participants or their firms in such reports. We also do not allow audio recording, which we ask that you respect. All statements we make during this call, other than statements of historical fact, constitute forward-looking statements made pursuant to the safe harbor provided by the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks, uncertainties, and other factors that could cause our actual results to be materially different from historical results and from any future results expressed or implied by the forward-looking statements. For a list of those factors and risks, please refer to our annual report on form 10Q, the quarterly report performed 10Q for the quarter ended June 30th, 2025, filed today, August 1st, and our subsequent filing made with the SEC. This information and supplemental materials relating to today's call will be posted on our investor relations website. All cautionary statements we make during the call should be understood as being applicable to any forward-looking statements we make wherever they appear. You should carefully consider the risks described in our reports and should not place any undue reliance on any forward-looking statements. We assume no responsibility for updating any forward-looking statements. We refer to OIBDA and free cash flow during this call. The comparable gap measure and a reconciliation for OIBDA is presented in our earnings release and, in the case of free cash flow, in our 10-Q. With that, I'll turn it over to Hamid.

Thank you, Dean. Welcome, everyone. Thank you for joining us today. I would like to address a few notable items from the second quarter as well as an additional recent development. As we have said in our SEC filings on May 9, the FCC informed us that it had begun a review of our spectrum licenses. This includes a review of certain obligations to provide 5G broadband service, the September 2024 build-out extension granted by the FCC, and our exclusive rights to the AWS 4 band. and the inquiries it introduced have led to considerable amount of uncertainty over our spectrum rights. It has effectively frozen our ability to make decisions about our 5G terrestrial network build out, has materially impacted our ability to implement and adjust our overall business plan, and has required us to reevaluate the deployment of our resources. As a result of the FCC's inquiry, we chose to delay several of our scheduled interest payments. We submitted detailed responses in the various public proceedings the agency launched back in May. As explained in our responses, we strongly disagree with the factual and legal basis of the FCC's inquiries. On June 11, our chairman met with FCC Chairman Carr and explained how the FCC's actions threaten our viability. Following this meeting, President Trump encouraged the parties involved to reach a positive resolution. Due to the nature of our ongoing discussions with the FCC, government, and other entities, we chose to make our delayed interest payments within the permissible grace periods. In addition, today we made the due payment for our HSSC bonds. Since then, we have had numerous collaborative conversations with the FCC, the administration, and various parties to try and reach a constructive solution that is beneficial to ECOSTAR and consumers while also addressing the FCC's wishes and fosters U.S. leadership in telecom. It is our highest priority and a huge focus of the leadership team, including myself, but given the ongoing nature of this issue, I can't say more or get into any specifics today. The commitment to securing our future and promoting U.S. leadership in the global communications industry is a top priority. An exciting step towards that goal we've announced an agreement with MDA Space for them to be the prime contractor for our new LEO direct-to-device, or D2D satellite constellation. This new constellation will enable EchoStar to provide global wideband services directly to standard 5G and TN devices, such as popular Android and Apple and other compatible IoT products, and help foster U.S. leadership in D2D connectivity and the space economy. The constellation is enabled by our global S-band spectrum rights, which includes exclusive U.S. rights for AWS 4, along with the 30 megahertz of S-band, 2 gigahertz of SS rights in Europe, and similar magnitude of spectrum around the world. These spectrum rights, our technological leadership, and our strong service delivery capabilities will allow us to provide the dedicated capacity and security services that are in demand by consumer, enterprise, public safety, and government sectors within the U.S., Europe, and the rest of the world. Since 2012, Echostar has invested well over $13 billion in the S-band, beginning with the acquisition of two of the original MSS operators, DBSD and TerraStar, who held S-band FCC licenses, as well as three geostationary satellites, which are in operation today. We also led the efforts to include the S-band in the 3GPP standard to allow for satellite compatibility with off-the-shelf handsets. Echostar's total investment includes the acquisition, integration, deployment, and operation of the AWS 4-band as part of its 5G Open RAN network in the U.S. Echostar's new LEO constellation will utilize up to 25 by 20 megahertz of AWS 4 slash S-band spectrum. And we... will be fully compliant with the newly created NTN and 3GPP standards, allowing EchoStar to provide messaging, voice, broadband data, and video services upon launch to all devices with the current 3GPP NTN specification without modification. This is true 5G mobility. This wideband service is a fundamental improvement over the existing satellite messaging and SOS services. Launch of the satellites is planned for 2028, with commercial services starting in 2029. Initial configuration of the system consists of 200 satellites rapidly growing from there to provide continuous growth of capacity globally. Peak funding of the project is estimated to cost $5 billion, which will be self-funded by ECOSTAR. As we said, when we merged ECOSTAR and DISH in 2024, A key goal was to unite the spectrum and technological assets across both companies to realize our vision of a global D2D service seamlessly integrated with terrestrial connectivity to everyone. We look forward to sharing more details on this project in September at World Space Business Week in Paris. I'll now comment on some details across our lines of business. Our wireless segment continues to perform well as we executed on another quarter of sequential growth with 212,000 subscribers net ads in the period compared to a 16,000 net loss in the same period of 2024. Boost Mobile continues to focus efforts on driving profitable subscriber growth and delivering an exceptional customer experience with better value than the established carriers. The quality of our subscriber base continues to improve as evidenced by churn of 2.69%, an improvement of 24 basis points year-over-year, and an industry-leading level of prepaid ARPU. A significant factor in this success is our net port positive performance. These efforts led to us ending the quarter with approximately 7.4 million subscribers. Our broadband and satellite services segment offers market-leading products and services to a wide range of consumers, enterprises, and governments throughout the world. Our technology leadership in satellite, networking, and broadband services enables us to provide advanced communication services and solutions, fueling an 8% increase in our enterprise-committed contract volume year over year. On the Aerofront, we are pleased to be recently selected by two large airlines to deploy our huge in-flight connectivity solution in their fleets continuing our penetration in the market. Our in-flight connectivity business provides the aero industry's only future-proof solution by leveraging multi-frequency LEO-GEO satellite networks with multiple connectivity providers to offer airline customers a unique, flexible, and cost-effective solution. We have made significant advances with our in-flight product offerings, such as in-line fit production capabilities and selection by Airbus to offer joint service technology solutions to their customers via their HBC Plus in-flight connectivity program. In the second quarter, Hughes also received the AS9100 quality certification, a compliment to the numerous FAA certification milestones for products we have received over the past year. We are pleased with the success of this business unit and are optimistic about future global opportunities in this market. Finally, our HughesNet consumer business we closed Q2 with approximately 820,000 broadband subscribers, delivering higher ARPU as a result of focusing on higher value customers. In regard to our pay TV business, we remain steadfast in acquiring and retaining the most profitable subscribers despite headwinds in the pay TV landscape from new service entrants, M&A activity, and the overall cost of programming. Dish TV finished the quarter with approximately 5.3 million subscribers, churn continues to be at its lowest levels in more than a decade, excluding the pandemic, while viewership is up 8% year-over-year. For the quarter, churn was 1.29%, a reduction of roughly 11 basis points from Q2 of 2024. Our customers appreciate our exceptional product and the performance we are able to deliver, as is evidenced by this decrease in churn year-over-year. Pay TV also grew its ARPU 3% year-over-year. In spite of the highly competitive headwinds in the streaming market and lower tuning events across the sports and politics, Slink viewership increased 18% year-over-year. Additionally, Slink's streaming quality reached an all-time high, increasing our industry-leading performance measured by Conviva. We closed the second quarter with approximately 1.8 million Slink subscribers. Now I would like to turn it over to Paul Orbit for commentary and color on the numbers.