DirecTV Revenues Up, Despite Costly HD Push

DirecTV Group managed to put up some impressive revenue numbers for the first quarter of 2007, although the area in which it made the loudest noise--HD growth--appeared to have dampened some investor enthusiasm because of the costs of growing new HD subscribers and maintaining current ones.

While HD interest among consumers is running sky-high (perhaps encouraged by DirecTV's own advertising and PR campaign to offer at least 100 HD channels by the end of 2007), shares of the DBS firm's stock dropped about 2 percent over the quarter. The reason: Costs of attracting and keeping HD subs "was higher than expected," according to

Overall, group profits grew to $336 million in Q1 2007, up 43 percent from $235 million a year ago. Revenue rose 15 percent to slightly more than $3.9 billion. At the same time, DirecTV added about 235,000 U.S. customers (double the number of HD subs compared with Q1 2006).