UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED ~~MARCH 31,~~JUNE 30, 2023.


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ______ TO______.

Commission File Number: 333-31929

DISH DBS Corporation

(Exact name of registrant as specified in its charter)


Colorado	84-1328967
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

9601 South Meridian Boulevard
Englewood, Colorado	80112
(Address of principal executive offices)	(Zip code)

(303) 723-1000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act: None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ⌧ No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ⌧ No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer ◻		Accelerated filer ◻

Non-accelerated filer ⌧		Smaller reporting company ☐

		Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ⌧

As of ~~May~~August 8, 2023, the registrant’s outstanding common stock consisted of 1,015 shares of common stock, $0.01 par value.

The registrant meets the conditions set forth in General Instructions (H)(1)(a) and (b) of Form 10-Q and is therefore filing this Form 10-Q with the reduced disclosure format.

Table of Contents

TABLE OF CONTENTS


PART I — FINANCIAL INFORMATION

	Disclosure Regarding Forward-Looking Statements	i

Item 1.	Financial Statements

	Condensed Consolidated Balance Sheets	1

	Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)	2

	Condensed Consolidated Statements of Changes in Stockholder’s Equity (Deficit)	3

	Condensed Consolidated Statements of Cash Flows	4

	Notes to Condensed Consolidated Financial Statements	5

Item 2.	Management’s Narrative Analysis of Results of Operations	3839

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	*

Item 4.	Controls and Procedures	4953

PART II — OTHER INFORMATION

Item 1.	Legal Proceedings	4953

Item 1A.	Risk Factors	4953

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	*

Item 3.	Defaults Upon Senior Securities	*

Item 4.	Mine Safety Disclosures	None

Item 5.	Other Information	None

Item 6.	Exhibits	5054

	Signatures	5155

*	This item has been omitted pursuant to the reduced disclosure format as set forth in General Instructions (H)(2) of Form 10-Q.

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PART I — FINANCIAL INFORMATION

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

Unless otherwise required by the context, in this report, the words “DISH DBS,” the “Company,” “we,” “our” and “us” refer to DISH DBS Corporation and its subsidiaries, “DISH Network” refers to DISH Network Corporation, our parent company, and its subsidiaries, including us, and “EchoStar” refers to EchoStar Corporation and its subsidiaries.

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including, in particular, statements about our plans, objectives and strategies, growth opportunities in our industries and businesses, our expectations regarding future results, financial condition, liquidity and capital requirements, our estimates regarding the impact of regulatory developments and legal proceedings, and other trends and projections. Forward-looking statements are not historical facts and may be identified by words such as “future,” “anticipate,” “intend,” “plan,” “goal,” “seek,” “believe,” “estimate,” “expect,” “predict,” “will,” “would,” “could,” “can,” “may,” and similar terms. These forward-looking statements are based on information available to us as of the date of this Quarterly Report on Form 10-Q and represent management’s current views and assumptions. Forward-looking statements are not guarantees of future performance, events or results and involve known and unknown risks, uncertainties and other factors, which may be beyond our control. Accordingly, actual performance, events or results could differ materially from those expressed or implied in the forward-looking statements due to a number of factors, including, but not limited to, those summarized below:

SUMMARY OF RISK FACTORS

Competition and Economic Risks

●

We face intense and increasing competition from providers of video, broadband and/or wireless services, which may require us to further increase subscriber acquisition and retention spending or accept lower subscriber activations and higher subscriber churn.

●

Changing consumer behavior and new technologies in our Pay-TV business may reduce our subscriber activations and may cause our subscribers to purchase fewer services from us or to cancel our services altogether, resulting in less revenue to us.

●

Our pay-TV competitors may be able to leverage their relationships with programmers to reduce their programming costs and/or offer exclusive content that will place them at a competitive advantage to us.

●

Changes in how network operators handle and charge for access to data that travels across their networks could adversely impact our Pay-TV business.

●

Economic weakness and uncertainty may adversely affect our ability to grow or maintain our business.

COVID-19 Pandemic

●

The COVID-19 pandemic and its impact on the economic environment generally, and on us specifically, have adversely impacted our business. Furthermore, any continuation or worsening of the pandemic and the economic environment could have a material adverse effect on our business, financial condition and results of operations.

Operational and Service Delivery Risks

●

Any deterioration in our operational performance and subscriber satisfaction could adversely affect our business, financial condition and results of operations.

●

If our subscriber activations decrease, or if our subscriber churn rate, subscriber acquisition costs or retention costs increase, our financial performance will be adversely affected.

●

Our programming expenses are increasing, which may adversely affect our future financial condition and results of operations.

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●

We depend on others to provide the programming that we offer to our Pay-TV subscribers and, if we fail to obtain or lose access to certain programming, our Pay-TV subscriber activations and our subscriber churn rate may be negatively impacted.

●

We may not be able to obtain necessary retransmission consent agreements at acceptable rates, or at all, from local network stations.

●

We have experienced and may continue to experience cyber-attacks or other malicious activities that disrupted or may continue to disrupt our business and any future failure or disruption of our information technology infrastructure and communications systems or those of third parties that we use in our operations, could harm our business.

●

Extreme weather may result in risk of damage to our infrastructure and therefore our ability to provide services, and may lead to changes in federal, state and foreign government regulation, all of which could materially and adversely affect our business, results of operations and financial condition.

●

We currently depend on DISH Network to provide the vast majority of our satellite transponder capacity and other related services to us. Our business would be adversely affected if DISH Network ceases to provide these services to us and we are unable to obtain suitable replacement services from third parties.

●

Our failure to effectively invest in, introduce, and implement new competitive products and services could cause our products and services to become obsolete and could negatively impact our business.

●

We rely on a single vendor or a limited number of vendors to provide certain key products or services to us, and the inability of these key vendors to meet our needs could have a material adverse effect on our business.

●

We depend on independent third parties to solicit orders for our services that represent a meaningful percentage of our total gross new subscriber activations.

●

We have limited satellite capacity and failures or reduced capacity could adversely affect our business, financial condition and results of operations.

●

We may have potential conflicts of interest with EchoStar due to our and DISH Network’s common ownership and management.

●

We rely on highly skilled personnel for our business, and any inability to hire and retain key personnel or hire qualified personnel may negatively affect our business, financial condition and results of operations.

Acquisition and Capital Structure Risks

●

Our parent, DISH Network, has made substantial investments to acquire certain wireless spectrum licenses and other related assets, and we have made and may continue to make funds available to DISH Network in the form of cash distributions or loans in connection with the development of DISH Network’s wireless business.

●

Our parent, DISH Network, has made substantial noncontrolling investments in the Northstar Entities and the SNR Entities related to AWS-3 wireless spectrum licenses, and we have made and may make additional cash distributions or loans to DISH Network so that DISH Network may fund the Northstar Entities and the SNR Entities including their obligations to purchase Northstar Manager’s and SNR Management’s ownership interests.

●

We may pursue acquisitions and other strategic transactions to complement or expand our business that may not be successful, and we may lose up to the entire value of our investment in these acquisitions and transactions.

●

We have substantial debt outstanding and may incur additional debt.

●

Our Senior Secured Notes (defined herein) are subordinated to our existing unsecured notes and certain future unsecured notes with respect to certain realizations under the Intercompany Loan (defined herein) and any collateral pledged as security therefor.

●

We may need additional capital, which may not be available on favorable terms, to continue investing in our business and to finance acquisitions and other strategic transactions.

●

Our parent, DISH Network, is controlled by one principal stockholder who is also our Chairman.

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Legal and Regulatory Risks

●

Our business depends on certain intellectual property rights and on not infringing the intellectual property rights of others.

●

We are, and may become, party to various lawsuits which, if adversely decided, could have a significant adverse impact on our business, particularly lawsuits regarding intellectual property.

●

Our services depend on Federal Communications Commission (“FCC”) licenses that can expire or be revoked or modified and applications for FCC licenses that may not be granted.

●

If our internal controls are not effective, our business, DISH Network’s stock price and investor confidence in our financial results may be adversely affected.

●

We may face other risks described from time to time in periodic and current reports we file with the Securities and Exchange Commission (“SEC”).

Other factors that could cause or contribute to such differences include, but are not limited to, those discussed under the caption “Risk Factors” in Part I, Item 1A of our most recent Annual Report on Form 10-K (the “10-K”) filed with the SEC, those discussed in “Management’s Narrative Analysis of Results of Operations” herein and in the 10-K and those discussed in other documents we file with the SEC. All cautionary statements made or referred to herein should be read as being applicable to all forward-looking statements wherever they appear. Investors should consider the risks and uncertainties described or referred to herein and should not place undue reliance on any forward-looking statements. The forward-looking statements speak only as of the date made, and we expressly disclaim any obligation to update these forward-looking statements.

iii

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Item 1. FINANCIAL STATEMENTS

DISH DBS CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except share amounts)

(Unaudited)



	As of				As of
	March 31,		December 31,		June 30,		December 31,
	2023		2022		2023		2022
Assets
Current Assets:
Cash and cash equivalents	$	113,324	$	621,975	$	84,725	$	621,975
Marketable investment securities		12,032		282,733		44,113		282,733
Trade accounts receivable, net of allowance for credit losses of $40,437 and $40,642, respectively		628,930		660,808
Trade accounts receivable, net of allowance for credit losses of $38,901 and $40,642, respectively						567,943		660,808
Inventory		307,992		307,411		302,191		307,411
Interest receivable - DISH Network (Note 13)						17,490		—
Other current assets		161,600		176,935		163,238		176,935
Total current assets		1,223,878		2,049,862		1,179,700		2,049,862

Noncurrent Assets:
Restricted cash, cash equivalents and marketable investment securities		54,073		53,525		54,717		53,525
Property and equipment, net		937,228		990,886		885,257		990,886
FCC authorizations		611,794		611,794		611,794		611,794
Other investment securities		93,069		93,806		93,098		93,806
Operating lease assets		108,613		130,454		98,760		130,454
Note receivable - DISH Network (Note 13)		7,160,116		7,160,116		7,381,589		7,160,116
Interest receivable - DISH Network (Note 13)		147,648		36,912		19,028		36,912
Other noncurrent assets, net		108,238		116,026		101,756		116,026
Total noncurrent assets		9,220,779		9,193,519		9,245,999		9,193,519
Total assets	$	10,444,657	$	11,243,381	$	10,425,699	$	11,243,381

Liabilities and Stockholder's Equity (Deficit)
Current Liabilities:
Trade accounts payable	$	453,455	$	385,899	$	331,771	$	385,899
Deferred revenue and other		524,677		555,151		480,375		555,151
Accrued programming		1,373,088		1,298,777		1,275,925		1,298,777
Accrued interest		223,431		180,823		160,197		180,823
Other accrued expenses		724,552		644,574		594,626		644,574
Current portion of long-term debt and finance lease obligations (Note 8)		41,880		1,484,101		42,779		1,484,101
Total current liabilities		3,341,083		4,549,325		2,885,673		4,549,325

Long-Term Obligations, Net of Current Portion:
Long-term debt and finance lease obligations, net of current portion (Note 8)		11,753,144		11,761,407		11,745,887		11,761,407
Deferred tax liabilities		334,471		352,748		317,686		352,748
Operating lease liabilities		66,635		75,142		61,732		75,142
Long-term deferred revenue and other long-term liabilities		214,304		209,288		217,743		209,288
Total long-term obligations, net of current portion		12,368,554		12,398,585		12,343,048		12,398,585
Total liabilities		15,709,637		16,947,910		15,228,721		16,947,910

Commitments and Contingencies (Note 9)

Stockholder’s Equity (Deficit):
Common stock, $0.01 par value, 1,000,000 shares authorized, 1,015 shares issued and outstanding		—		—		—		—
Additional paid-in capital		1,539,037		1,532,906		1,543,310		1,532,906
Accumulated other comprehensive income (loss)		(2,310)		(2,445)		(2,263)		(2,445)
Accumulated earnings (deficit)		(6,801,707)		(7,234,990)		(6,344,069)		(7,234,990)
Total stockholder’s equity (deficit)		(5,264,980)		(5,704,529)		(4,803,022)		(5,704,529)
Total liabilities and stockholder’s equity (deficit)	$	10,444,657	$	11,243,381	$	10,425,699	$	11,243,381

The accompanying notes are an integral part of these condensed consolidated financial statements.

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DISH DBS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE INCOME (LOSS)

(In thousands)

(Unaudited)

For the Three Months Ended

March 31,


2023

2022

Revenue:

Service revenue

$
2,924,045

$
3,108,313

Equipment sales and other revenue

22,366

25,098

Total revenue

2,946,411

3,133,411

Costs and Expenses (exclusive of depreciation):

Cost of services

1,856,592

1,890,096

Cost of sales - equipment and other

17,300

20,872

Selling, general and administrative expenses

335,720

401,751

Depreciation and amortization

83,900

95,916

Total costs and expenses

2,293,512

2,408,635

Operating income (loss)

652,899

724,776

Other Income (Expense):

Interest income

120,386

97,120

Interest expense, net of amounts capitalized

(198,800)

(232,369)

Other, net

(579)

790

Total other income (expense)

(78,993)

(134,459)

Income (loss) before income taxes

573,906

590,317

Income tax (provision) benefit, net

(140,623)

(145,906)

Net income (loss)

$
433,283

$
444,411

Comprehensive Income (Loss):

Net income (loss)

$
433,283

$
444,411

Other comprehensive income (loss):

Foreign currency translation adjustments

136

(187)

Unrealized holding gains (losses) on available-for-sale debt securities

12

(76)

Deferred income tax (expense) benefit, net

(13)

21

Total other comprehensive income (loss), net of tax

135

(242)

Comprehensive income (loss)

$
433,418

$
444,169


	For the Three Months Ended				For the Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022
Revenue:
Service revenue	$	2,852,460	$	3,093,765	$	5,776,505	$	6,202,078
Equipment sales and other revenue		98,699		27,249		121,065		52,347
Total revenue		2,951,159		3,121,014		5,897,570		6,254,425

Costs and Expenses (exclusive of depreciation):
Cost of services		1,782,237		1,887,814		3,638,829		3,777,910
Cost of sales - equipment and other		22,438		21,922		39,738		42,794
Selling, general and administrative expenses		380,182		364,147		715,902		765,898
Depreciation and amortization		81,832		89,418		165,732		185,334
Total costs and expenses		2,266,689		2,363,301		4,560,201		4,771,936

Operating income (loss)		684,470		757,713		1,337,369		1,482,489

Other Income (Expense):
Interest income		111,404		113,281		231,790		210,401
Interest expense, net of amounts capitalized		(184,511)		(230,210)		(383,311)		(462,579)
Other, net		(95)		455		(674)		1,245
Total other income (expense)		(73,202)		(116,474)		(152,195)		(250,933)

Income (loss) before income taxes		611,268		641,239		1,185,174		1,231,556
Income tax (provision) benefit, net		(153,630)		(158,059)		(294,253)		(303,965)
Net income (loss)	$	457,638	$	483,180	$	890,921	$	927,591

Comprehensive Income (Loss):
Net income (loss)	$	457,638	$	483,180	$	890,921	$	927,591
Other comprehensive income (loss):
Foreign currency translation adjustments		53		(507)		189		(694)
Unrealized holding gains (losses) on available-for-sale debt securities		1		6		13		(70)
Deferred income tax (expense) benefit, net		(7)		(7)		(20)		14
Total other comprehensive income (loss), net of tax		47		(508)		182		(750)
Comprehensive income (loss)	$	457,685	$	482,672	$	891,103	$	926,841

The accompanying notes are an integral part of these condensed consolidated financial statements.

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DISH DBS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDER’S EQUITY (DEFICIT)

(In thousands)

(Unaudited)

Accumulated

Additional

Other

Accumulated

Common

Paid-In

Comprehensive

Earnings

Stock

Capital

Income (Loss)

(Deficit)

Total
Balance, December 31, 2021

$
—

$
1,492,174

$
(1,262)

$
(9,045,735)

$
(7,554,823)
Non-cash, stock-based compensation

—

8,383

—

—

8,383
Change in unrealized holding gains (losses) on available-for-sale debt securities, net

—

—

(76)

—

(76)
Deferred income tax (expense) benefit attributable to other comprehensive income (loss)

—

—

21

—

21
Foreign currency translation

—

—

(187)

—

(187)
Net income (loss)

—

—

—

444,411

444,411
Other

—

13

—

—

13
Balance, March 31, 2022

$
—

$
1,500,570

$
(1,504)

$
(8,601,324)

$
(7,102,258)

Balance, December 31, 2022

$
—

$
1,532,906

$
(2,445)

$
(7,234,990)

$
(5,704,529)
Non-cash, stock-based compensation

—

6,131

—

—

6,131
Change in unrealized holding gains (losses) on available-for-sale debt securities, net

—

—

12

—

12
Deferred income tax (expense) benefit attributable to other comprehensive income (loss)

—

—

(13)

—

(13)
Foreign currency translation

—

—

136

—

136
Net income (loss)

—

—

—

433,283

433,283
Balance, March 31, 2023

$
—

$
1,539,037

$
(2,310)

$
(6,801,707)

$
(5,264,980)


					Accumulated
			Additional		Other		Accumulated
	Common		Paid-In		Comprehensive		Earnings
	Stock		Capital		Income (Loss)		(Deficit)		Total
Balance, December 31, 2021	$	—	$	1,492,174	$	(1,262)	$	(9,045,735)	$	(7,554,823)
Non-cash, stock-based compensation		—		8,383		—		—		8,383
Change in unrealized holding gains (losses) on available-for-sale debt securities, net		—		—		(76)		—		(76)
Deferred income tax (expense) benefit attributable to other comprehensive income (loss)		—		—		21		—		21
Foreign currency translation		—		—		(187)		—		(187)
Net income (loss)		—		—		—		444,411		444,411
Other		—		13		—		—		13
Balance, March 31, 2022	$	—	$	1,500,570	$	(1,504)	$	(8,601,324)	$	(7,102,258)
Non-cash, stock-based compensation		—		7,888		—		—		7,888
Change in unrealized holding gains (losses) on available-for-sale debt securities, net		—		—		6		—		6
Deferred income tax (expense) benefit attributable to other comprehensive income (loss)		—		—		(7)		—		(7)
Foreign currency translation		—		—		(507)		—		(507)
Net income (loss)		—		—		—		483,180		483,180
Other		—		(13)		—		—		(13)
Balance, June 30, 2022	$	—	$	1,508,445	$	(2,012)	$	(8,118,144)	$	(6,611,711)

Balance, December 31, 2022	$	—	$	1,532,906	$	(2,445)	$	(7,234,990)	$	(5,704,529)
Non-cash, stock-based compensation		—		6,131		—		—		6,131
Change in unrealized holding gains (losses) on available-for-sale debt securities, net		—		—		12		—		12
Deferred income tax (expense) benefit attributable to other comprehensive income (loss)		—		—		(13)		—		(13)
Foreign currency translation		—		—		136		—		136
Net income (loss)		—		—		—		433,283		433,283
Balance, March 31, 2023	$	—	$	1,539,037	$	(2,310)	$	(6,801,707)	$	(5,264,980)
Non-cash, stock-based compensation		—		4,273		—		—		4,273
Change in unrealized holding gains (losses) on available-for-sale debt securities, net		—		—		1		—		1
Deferred income tax (expense) benefit attributable to other comprehensive income (loss)		—		—		(7)		—		(7)
Foreign currency translation		—		—		53		—		53
Net income (loss)		—		—		—		457,638		457,638
Balance, June 30, 2023	$	—	$	1,543,310	$	(2,263)	$	(6,344,069)	$	(4,803,022)

The accompanying notes are an integral part of these condensed consolidated financial statements.

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DISH DBS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)


	For the Three Months Ended				For the Six Months Ended
	March 31,				June 30,
	2023			2022	2023			2022
Cash Flows From Operating Activities:
Net income (loss)	$	433,283	$	444,411	$	890,921	$	927,591
Adjustments to reconcile net income (loss) to net cash flows from operating activities:
Depreciation and amortization		83,900		95,916		165,732		185,334
Realized and unrealized losses (gains) on investments and other		(49)		6		(49)		1,149
Non-cash, stock-based compensation		6,131		8,383		10,404		16,271
Deferred tax expense (benefit)		(18,290)		(29,922)		(35,082)		(61,618)
Changes in allowance for credit losses		(205)		(3,943)		(1,741)		(9,015)
Other, net		14,803		29,579		26,321		33,836
Non-cash interest income - DISH Network		(110,736)		(93,875)		(203,588)		(199,262)
Changes in current assets and current liabilities, net		304,254		83,524		(96,750)		(103,854)
Net cash flows from operating activities		713,091		534,079		756,168		790,432

Cash Flows From Investing Activities:
(Purchases) Sales and maturities of marketable investment securities, net		270,713		1,333,695		238,633		1,586,861
Purchases of property and equipment		(31,386)		(30,889)		(61,414)		(60,432)
Notes receivable - DISH Network		—		(1,500,000)		—		(1,500,000)
Other, net		688		1,623		1,230		2,675
Net cash flows from investing activities		240,015		(195,571)		178,449		29,104

Cash Flows From Financing Activities:
Repayment of long-term debt and finance lease obligations		(18,081)		(10,170)		(27,547)		(22,306)
Redemption and repurchases of senior notes		(1,443,179)		(1,175)		(1,443,179)		(301,331)
Other, net		51		(6)		51		(1,126)
Net cash flows from financing activities		(1,461,209)		(11,351)		(1,470,675)		(324,763)

Net increase (decrease) in cash, cash equivalents, restricted cash and cash equivalents		(508,103)		327,157		(536,058)		494,773
Cash, cash equivalents, restricted cash and cash equivalents, beginning of period (Note 4)		675,500		1,428,618		675,500		1,428,618
Cash, cash equivalents, restricted cash and cash equivalents, end of period (Note 4)	$	167,397	$	1,755,775	$	139,442	$	1,923,391

The accompanying notes are an integral part of these condensed consolidated financial statements.

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DISH DBS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1.	Organization and Business Activities

Principal Business

DISH DBS Corporation (which together with its subsidiaries is referred to as “DISH DBS,” the “Company,” “we,” “us” and/or “our,” unless otherwise required by the context) is a holding company and an indirect, wholly-owned subsidiary of DISH Network Corporation (“DISH Network”). DISH DBS was formed under Colorado law in January 1996 and its common stock is held by DISH Orbital Corporation (“DOC”), a direct subsidiary of DISH Network. Our subsidiaries operate one business segment, Pay-TV.

Pay-TV

We offer pay-TV services under the DISH^® brand and the SLING^® brand (collectively “Pay-TV” services). The DISH branded pay-TV service consists of, among other things, Federal Communications Commission (“FCC”) licenses authorizing us to use direct broadcast satellite (“DBS”) and Fixed Satellite Service (“FSS”) spectrum, our owned and leased satellites, receiver systems, broadcast operations, a leased fiber optic network, in-home service and call center operations, and certain other assets utilized in our operations (“DISH TV”). We also design, develop and distribute receiver systems and provide digital broadcast operations, including satellite uplinking/downlinking, transmission and other services to third-party pay-TV providers. The SLING branded pay-TV services consist of, among other things, multichannel, live-linear and on-demand streaming over-the-top (“OTT”) Internet-based domestic, international and Latino video programming services (“SLING TV”). As of ~~March 31,~~June 30, 2023, we had ~~9.198~~8.904 million Pay-TV subscribers in the United States, including ~~7.098~~6.901 million DISH TV subscribers and ~~2.100~~2.003 million SLING TV subscribers.

~~Recent~~Other Developments

Cyber-Security Incident

On February 23, 2023, our parent, DISH Network, announced on its quarterly earnings call that we had experienced a network outage that affected internal servers and IT telephony. We immediately activated our incident response and business continuity plans designed to contain, assess and remediate the situation. We engaged the services of cyber-security experts and outside advisors to assist in the evaluation of the situation, and once we determined that the outage was due to a cyber-security incident, we promptly notified appropriate law enforcement authorities.

On February 28, 2023, we further disclosed that certain data had been extracted from our IT systems as part of this incident. Our investigation into the extent of the incident is now ~~substantially~~ completed. We have determined that our customer databases were not accessed in this incident. However, we have confirmed that certain employee-related records as well as a limited number of other records containing personal information were among the data extracted. We have taken steps to protect the affected records and personal information, and we received confirmation that the extracted data has been deleted. While we have no evidence that this data has been misused, we have ~~started the process of notifying~~notified individuals whose data was extracted.

Our DISH TV and SLING TV services remained operational at all times during the incident. As of March 31, 2023, all significant systems ~~have~~had been restored.

During the first quarter ~~ending March 31,~~of 2023, we and our parent, DISH Network, incurred ~~certain~~substantially all of our cyber-security-related expenses for this matter, including, but not limited to, costs to remediate the incident and provide additional customer support. During the three months ended ~~March 31,~~June 30, 2023, we and our parent, DISH Network, have not incurred material expenses resulting from the cyber-security incident and do not expect to incur material expenses in future periods. During the six months ended June 30, 2023, we and our parent, DISH Network, incurred approximately $30 million in cyber-security-related expenses, which are recorded in “Cost of services” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). ~~We do not expect to incur material expenses in future periods resulting from the cyber-security incident.~~

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DISH DBS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

(Unaudited)

2.	Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and with the instructions to Form 10-Q and Article 10 of Regulation S-X for interim financial information. Accordingly, these statements do not include all of the information and notes required for complete financial statements prepared under GAAP. In our opinion, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Our results of operations for the interim periods presented are not necessarily indicative of the results that may be expected for the full year. For further information, refer to the Consolidated Financial Statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2022. Certain prior period amounts have been reclassified to conform to the current period presentation.

Principles of Consolidation

We consolidate all majority owned subsidiaries, investments in entities in which we have controlling influence and variable interest entities (“VIEs”) where we have been determined to be the primary beneficiary. Minority interests are recorded as noncontrolling interests or redeemable noncontrolling interests. Non-consolidated investments are accounted for using the equity method when we have the ability to significantly influence the operating decisions of the investee. When we do not have the ability to significantly influence the operating decisions of an investee, these equity securities are classified as either marketable investment securities or other investments and recorded at fair value with changes recognized in “Other, net” within “Other Income (Expense)” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). All significant intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense for each reporting period. Estimates are based on historical experience and other reasonable assumptions in accounting for, among other things, allowances for credit losses, self-insurance obligations, deferred taxes and related valuation allowances, uncertain tax positions, loss contingencies, fair value of financial instruments, fair value of options granted under DISH Network’s stock-based compensation plans, fair value of assets and liabilities acquired in business combinations, relative standalone selling prices of performance obligations, finance leases, asset impairments, estimates of future cash flows used to evaluate and recognize impairments, useful lives of property, equipment and intangible assets, incremental borrowing rate (“IBR”) on lease right of use assets, nonrefundable upfront fees, independent third-party retailer incentives, programming expenses and subscriber lives. Economic conditions may increase the inherent uncertainty in the estimates and assumptions indicated above. Actual results may differ from previously estimated amounts, and such differences may be material to our condensed consolidated financial statements. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected prospectively in the period they occur.

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DISH DBS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

(Unaudited)

Fair Value Measurements

We determine fair value based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. Market or observable inputs are the preferred source of values, followed by unobservable inputs or assumptions based on hypothetical transactions in the absence of market inputs. We apply the following hierarchy in determining fair value:

●

Level 1, defined as observable inputs being quoted prices in active markets for identical assets;

●

Level 2, defined as observable inputs other than quoted prices included in Level 1, including quoted prices for similar assets and liabilities in active markets; and quoted prices for identical or similar instruments in markets that are not active; and

●

Level 3, defined as unobservable inputs for which little or no market data exists, consistent with reasonably available assumptions made by other participants therefore requiring assumptions based on the best information available.

As of ~~March 31,~~June 30, 2023 and December 31, 2022, the carrying amount for cash and cash equivalents, trade accounts receivable (net of allowance for credit losses) and current liabilities (excluding the “Current portion of long-term debt and finance lease obligations”) was equal to or approximated fair value due to their short-term nature or proximity to current market rates. See Note 4 for the fair value of our marketable investment securities.

Fair values for our publicly traded debt securities are based on quoted market prices, when available. The fair values of private debt are based on, among other things, available trade information, and/or an analysis in which we evaluate market conditions, related securities, various public and private offerings, and other publicly available information. In performing this analysis, we make various assumptions regarding, among other things, credit spreads, and the impact of these factors on the value of the debt securities. See Note 8 for the fair value of our long-term debt.

Assets Recognized Related to the Costs to Obtain a Contract with a Subscriber

We recognize an asset for the incremental costs of obtaining a contract with a subscriber if we expect the benefit of those costs to be longer than one year. We have determined that certain sales incentive programs, including those with our independent third-party retailers, meet the requirements to be capitalized, and payments made under these programs are capitalized and amortized to expense over the estimated subscriber life exceeding one year. During the three months ended ~~March 31,~~June 30, 2023 and 2022, we capitalized $1719 million and ~~$21~~$23 million, respectively, under these programs. The amortization expense related to these programs was ~~$35~~$33 million and ~~$41~~$40 million for the three months ended ~~March 31,~~June 30, 2023 and 2022, respectively. During the six months ended June 30, 2023 and 2022, we capitalized $36 million and $44 million, respectively, under these programs. The amortization expense related to these programs was $68 million and $81 million for the six months ended June 30, 2023 and 2022, respectively. As of ~~March 31,~~June 30, 2023 and December 31, 2022, we had a total of $~~212~~198 million and $230 million, respectively, capitalized, net of amortization, on our Condensed Consolidated Balance Sheets. These amounts are capitalized in “Other current assets” and “Other noncurrent assets, net” on our Condensed Consolidated Balance Sheets, and then amortized in “Selling, general and administrative expenses” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

Advertising Costs

We recognize advertising expense when incurred as a component of “Selling, general and administrative expenses” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). Advertising expenses totaled $86112 million and ~~$119~~$99 million for the three months ended ~~March 31,~~June 30, 2023 and 2022, respectively.

Advertising expenses totaled $198 million and $218 million for the six months ended June 30, 2023 and 2022, respectively.

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DISH DBS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

(Unaudited)

Research and Development

Research and development costs are expensed as incurred and are included as a component of “Selling, general and administrative expenses” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). Research and development costs totaled $11 million and ~~$10~~$12 million for the three months ended ~~March 31,~~June 30, 2023 and 2022, respectively. Research and development costs totaled $22 million for each of the six months ended June 30, 2023 and 2022.

New Accounting Pronouncements

We do not expect that any recently issued accounting pronouncements will have a material effect on our condensed consolidated financial statements.

3.	Supplemental Data - Statements of Cash Flows

The following table presents certain supplemental cash flow and other non-cash data. See Note 7 for supplemental cash flow and non-cash data related to leases.


	For the Three Months Ended				For the Six Months Ended
	March 31,				June 30,
	2023		2022		2023		2022

	(In thousands)				(In thousands)
Cash paid for interest	$	149,709	$	210,818	$	390,963	$	456,291
Cash received for interest		8,586		2,180		8,593		9,011
Cash paid for income taxes		316		203		8,059		18,016
Cash paid for income taxes to DISH Network		123,035		165,614		360,548		342,735
Unsettled repurchases of senior notes						—		35,000

Our parent, DISH Network, provides a centralized system for the management of our cash and marketable investment securities as it does for all of its subsidiaries to, among other reasons, maximize yield of the portfolio. As a result, the cash and marketable investment securities included on our Condensed Consolidated Balance Sheets are a component or portion of the overall cash and marketable investment securities portfolio included on DISH Network’s Condensed Consolidated Balance Sheets and are managed by DISH Network. We are reflecting the purchases and sales of marketable investment securities on a net basis for each period presented on our Condensed Consolidated Statements of Cash Flows as we believe the net presentation is more meaningful to our cash flows from investing activities.

In our Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2023, management reclassified certain non material amounts reported for the three months ended March 31, 2022 related to paid in kind interest associated with the Intercompany Loan (defined herein) from “Other net” in the investing activities section to “Non-cash interest income – DISH Network” in the operating activities section of our Condensed Consolidated Statements of Cash Flows. The change in presentation corrected an overstatement of cash flows from operations and an overstatement of cash used in investing activities. The misstatement had no impact on our financial position, results of operations or overall cash balances. The presentation of paid in kind interest has been appropriately presented in our Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2023.

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DISH DBS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

(Unaudited)

4.	Marketable Investment Securities, Restricted Cash and Cash Equivalents, and Other Investment Securities

Our marketable investment securities, restricted cash and cash equivalents, and other investment securities consisted of the following:



	As of				As of
	March 31,		December 31,		June 30,		December 31,
	2023		2022		2023		2022

	(In thousands)				(In thousands)
Marketable investment securities:
Current marketable investment securities	$	12,032	$	282,733	$	44,113	$	282,733

Restricted cash and cash equivalents (1)		54,073		53,525		54,717		53,525

Other investment securities:
Other investment securities		93,069		93,806		93,098		93,806

Total marketable investment securities, restricted cash and cash equivalents, and other investment securities	$	159,174	$	430,064	$	191,928	$	430,064

(1)	Restricted marketable investment securities and restricted cash and cash equivalents are included in “Restricted cash, cash equivalents and marketable investment securities” on our Condensed Consolidated Balance Sheets.

Marketable Investment Securities

Our marketable investment securities portfolio may consist of debt and equity instruments. All equity securities are carried at fair value, with changes in fair value recognized in “Other, net” within “Other Income (Expense)” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). All debt securities are classified as available-for-sale and are recorded at fair value. We report the temporary unrealized gains and losses related to changes in market conditions of marketable debt securities as a separate component of “Accumulated other comprehensive income (loss)” within “Stockholder’s Equity (Deficit),” net of related deferred income tax on our Condensed Consolidated Balance Sheets. The corresponding changes in the fair value of marketable debt securities, which are determined to be company specific credit losses are recorded in “Other, net” within “Other Income (Expense)” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss).

Current Marketable Investment Securities

Our current marketable investment securities portfolio can include investments in various debt instruments including, among others, commercial paper, corporate securities and United States treasury and/or agency securities.

Commercial paper consists mainly of unsecured short-term, promissory notes issued primarily by corporations with maturities ranging up to 365 days. Corporate securities consist of debt instruments issued by corporations with various maturities normally less than 18 months. U.S. Treasury and agency securities consist of debt instruments issued by the federal government and other government agencies.

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DISH DBS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

(Unaudited)

Restricted Cash, Cash Equivalents and Marketable Investment Securities

As of ~~March 31,~~June 30, 2023 and December 31, 2022, our restricted marketable investment securities, together with our restricted cash and cash equivalents, included amounts required as collateral for our letters of credit and trusts.

Other Investment Securities

We have strategic investments in certain debt and/or equity securities that are included in noncurrent “Other investment securities” on our Condensed Consolidated Balance Sheets. Our debt securities are classified as available-for-sale and are recorded at fair value and our equity securities are accounted for using the equity method of accounting or recorded at fair value. Certain of our equity method investments are detailed below.

NagraStar L.L.C. We own a 50% interest in NagraStar L.L.C. (“NagraStar”), a joint venture that is our primary provider of encryption and related security systems intended to assure that only authorized customers have access to our programming.

Invidi Technologies Corporation. In November 2016, we, AT&T Inc., and Cavendish Square Holding B.V., an affiliate of WPP plc, entered into a series of agreements to acquire Invidi Technologies Corporation (“Invidi”), an entity that provides proprietary software for the addressable advertising market.

Our ability to realize value from our strategic investments in securities that are not publicly traded depends on, among other things, the success of the issuers’ businesses and their ability to obtain sufficient capital, on acceptable terms or at all, and to execute their business plans. Because private markets are not as liquid as public markets, there is also increased risk that we will not be able to sell these investments, or that when we desire to sell them we will not be able to obtain fair value for them.

Fair Value Measurements

Our investments measured at fair value on a recurring basis were as follows:


	As of																As of
	March 31, 2023								December 31, 2022								June 30, 2023								December 31, 2022
	Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3

	(In thousands)																(In thousands)
Cash equivalents (including restricted)	$	140,982	$	54,097	$	86,885	$	—	$	650,523	$	99,437	$	551,086	$	—	$	114,125	$	65,366	$	48,759	$	—	$	650,523	$	99,437	$	551,086	$	—

Debt securities (including restricted):
U.S. Treasury and agency securities	$	—	$	—	$	—	$	—	$	7,727	$	7,727	$	—	$	—	$	—	$	—	$	—	$	—	$	7,727	$	7,727	$	—	$	—
Commercial paper		9,910		—		9,910		—		227,787		—		227,787		—		43,100		—		43,100		—		227,787		—		227,787		—
Corporate securities		2,045		—		2,045		—		46,764		—		46,764		—		874		—		874		—		46,764		—		46,764		—
Other		77		—		77		—		455		—		455		—		139		—		139		—		455		—		455		—
Total	$	12,032	$	—	$	12,032	$	—	$	282,733	$	7,727	$	275,006	$	—	$	44,113	$	—	$	44,113	$	—	$	282,733	$	7,727	$	275,006	$	—

As of ~~March 31,~~June 30, 2023, restricted and non-restricted marketable investment securities included debt securities of ~~$12~~$44 million with contractual maturities within one year. Actual maturities may differ from contractual maturities as a result of our ability to sell these securities prior to maturity.

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DISH DBS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

(Unaudited)

Gains and Losses on Sales and Changes in Carrying Amounts of Investments and Other

“Other, net” within “Other Income (Expense)” included on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) is as follows:


	For the Three Months Ended				For the Three Months Ended				For the Six Months Ended
	March 31,				June 30,				June 30,
Other, net:	2023		2022		2023		2022		2023		2022

	(In thousands)				(In thousands)
Costs related to early redemption of debt	$	49	$	(6)
Gains (losses) related to early redemption of debt					$	—	$	(1,143)	$	49	$	(1,149)
Equity in earnings (losses) of affiliates		(763)		679		(2)		1,282		(765)		1,961
Other		135		117		(93)		316		42		433
Total	$	(579)	$	790	$	(95)	$	455	$	(674)	$	1,245

5.Inventory

Inventory consisted of the following:


	As of				As of
	March 31,		December 31,		June 30,		December 31,
	2023		2022		2023		2022

	(In thousands)				(In thousands)
Finished goods	$	261,949	$	252,939	$	249,674	$	252,939
Work-in-process and service repairs		22,706		19,351		29,946		19,351
Raw materials		23,337		35,121		22,571		35,121
Total inventory	$	307,992	$	307,411	$	302,191	$	307,411

6.	Property and Equipment

Property and equipment consisted of the following:


	Depreciable		As of			Depreciable		As of
	Life	March 31,		December 31,		Life	June 30,		December 31,
	(In Years)	2023		2022		(In Years)	2023		2022

		(In thousands)					(In thousands)
Equipment leased to customers	2-5	$	1,264,030	$	1,309,737	2-5	$	1,263,380	$	1,309,737
EchoStar XV	15		277,658		277,658	15		277,658		277,658
EchoStar XVIII	15		411,255		411,255	15		411,255		411,255
Satellites acquired under finance lease agreements	15		174,685		174,685	15		174,685		174,685
Furniture, fixtures, equipment and other	2-20		1,058,220		1,054,619	2-20		1,058,508		1,054,619
Software	3-5		866,458		859,911	3-5		876,735		859,911
Buildings and improvements	5-40		295,328		295,375	5-40		296,033		295,375
Land	-		12,505		12,505	-		12,505		12,505
Construction in progress	-		35,722		35,326	-		38,468		35,326
Total property and equipment			4,395,861		4,431,071			4,409,227		4,431,071
Accumulated depreciation			(3,458,633)		(3,440,185)			(3,523,970)		(3,440,185)
Property and equipment, net		$	937,228	$	990,886		$	885,257	$	990,886

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DISH DBS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

(Unaudited)

Depreciation and amortization expense consisted of the following:


	For the Three Months Ended				For the Three Months Ended				For the Six Months Ended
	March 31,				June 30,				June 30,
	2023		2022		2023		2022		2023		2022

	(In thousands)				(In thousands)
Equipment leased to customers	$	46,712	$	51,270	$	44,853	$	49,743	$	91,565	$	101,013
Satellites		20,073		23,797		20,073		20,072		40,146		43,869
Buildings, furniture, fixtures, equipment and other		17,115		20,849		16,906		19,603		34,021		40,452
Total depreciation and amortization	$	83,900	$	95,916	$	81,832	$	89,418	$	165,732	$	185,334

Cost of sales and operating expense categories included in our accompanying Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) do not include depreciation expense related to satellites or equipment leased to customers.

Satellites

Pay-TV Satellites. We currently utilize ten satellites in geostationary orbit approximately 22,300 miles above the equator, two of which we own and depreciate over their estimated useful life. We currently utilize certain capacity on six satellites that we lease from DISH Network, which are accounted for as operating leases, except for Nimiq 5 which is accounted for as a finance lease and is depreciated over its economic life. We also lease two satellites from ~~third parties:~~third-parties: Ciel II and Anik F3, which are accounted for as operating leases.

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DISH DBS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

(Unaudited)

As of ~~March 31,~~June 30, 2023, our pay-TV satellite fleet consisted of the following:

Degree

Launch

Orbital

Lease

Launch

Orbital

Lease

Satellites

Date

Location

Termination Date

Date

Location

Termination Date

Owned:

EchoStar XV

July 2010

61.5

N/A

July 2010

61.5

N/A

EchoStar XVIII

June 2016

61.5

N/A

June 2016

61.5

N/A

Under Construction:

EchoStar XXV (1)

2026

110

N/A

2026

110

N/A

Leased from DISH Network (2):

EchoStar X

February 2006

110

February 2024

February 2006

110

February 2024

EchoStar XI

July 2008

110

February 2024

July 2008

110

February 2024

EchoStar XIV

March 2010

119

February 2024

March 2010

119

February 2024

EchoStar XVI

November 2012

61.5

January 2024

November 2012

61.5

January 2024

EchoStar XXIII

March 2017

110

Month to month

March 2017

110

Month to month

Nimiq 5

September 2009

72.7

September 2023

September 2009

72.7

September 2023

Leased from Other Third Party:

Leased from Other Third-Party:

Anik F3

April 2007

118.7

April 2025

April 2007

118.7

April 2025

Ciel II(3)

December 2008

129

July 2023

December 2008

129

July 2023

(1)

(2)	See Note 13 for further information on our Related Party Transactions with DISH Network.

(3)	We no longer lease this satellite.

7.	Leases

We enter into non-cancelable operating and finance leases for, among other things, satellites, office space, warehouses and distribution centers, vehicles, and other equipment. Our leases have remaining lease terms from one to nine years, some of which include renewal options, and some of which include options to terminate the leases within one year. For certain arrangements, the lease term includes the non-cancelable period plus the renewal period that we are reasonably certain to exercise.

Through the first quarter of 2022, our Anik F3 and Nimiq 5 satellites were accounted for as finance leases. However, during April 2022, we extended the Anik F3 lease and, as a result, it is currently accounted for as an operating lease. Substantially all of our remaining leases are accounted for as operating leases.

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DISH DBS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

(Unaudited)

The components of lease expense were as follows:


	For the Three Months Ended				For the Three Months Ended				For the Six Months Ended
	March 31,				June 30,				June 30,
	2023		2022		2023		2022		2023		2022

	(In thousands)				(In thousands)
Operating lease cost (1)	$	27,932	$	40,376	$	15,075	$	41,226	$	43,007	$	81,602

Short-term lease cost (1)(2)		31,219		16,330		46,080		25,659		77,299		41,989

Finance lease cost:
Amortization of right-of-use assets (3)		8,612		12,465		8,612		8,619		17,224		21,084
Interest on lease liabilities (3)		1,564		2,534		1,332		2,234		2,896		4,768
Total finance lease cost (3)		10,176		14,999		9,944		10,853		20,120		25,852
Total lease costs	$	69,327	$	71,705	$	71,099	$	77,738	$	140,426	$	149,443

(1)	The decrease in “Operating lease cost” is primarily related to our intercompany satellite leases with DISH Network, which were reclassified to “Short-term lease costs” during 2022 and the first quarter of 2023. All of our satellite operating leases with DISH Network are now short-term leases.

(2)	Leases that have terms of 12 months or less.

(3)	The decrease in finance lease cost is primarily related to the Anik F3 finance lease which was extended in April 2022 and, as a result, is currently accounted for as an operating lease.

Supplemental cash flow information related to leases was as follows:


	For the Three Months Ended				For the Six Months Ended
	March 31,				June 30,
	2023		2022		2023		2022

	(In thousands)				(In thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	54,497	$	39,163	$	69,507	$	80,561
Operating cash flows from finance leases	$	3,351	$	2,472	$	4,837	$	4,866
Financing cash flows from finance leases	$	18,080	$	10,170	$	27,547	$	22,167

Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	9,380	$	15,792	$	13,276	$	51,784
Finance leases	$	—	$	—	$	—	$	—

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(Unaudited)

Supplemental balance sheet information related to leases was as follows:


	As of				As of
	March 31,		December 31,		June 30,		December 31,
	2023		2022		2023		2022

	(In thousands)				(In thousands)
Operating Leases:
Operating lease assets	$	108,613	$	130,454	$	98,760	$	130,454

Other current liabilities	$	46,419	$	60,203	$	41,535	$	60,203
Operating lease liabilities		66,635		75,142		61,732		75,142
Total operating lease liabilities	$	113,054	$	135,345	$	103,267	$	135,345

Finance Leases:
Property and equipment, gross	$	175,704	$	175,704	$	175,704	$	175,704
Accumulated depreciation		(124,081)		(115,469)		(132,693)		(115,469)
Property and equipment, net	$	51,623	$	60,235	$	43,011	$	60,235

Other current liabilities	$	39,060	$	38,102	$	39,960	$	38,102
Other long-term liabilities		20,993		31,104		10,627		31,104
Total finance lease liabilities	$	60,053	$	69,206	$	50,587	$	69,206

Weighted Average Remaining Lease Term:
Operating leases		4.1 years		3.7 years		4.1 years		3.7 years
Finance leases		1.5 years		1.8 years		1.3 years		1.8 years

Weighted Average Discount Rate:
Operating leases		7.2%		7.2%		7.2%		7.2%
Finance leases		10.0%		10.0%		10.0%		10.0%

Maturities of lease liabilities as of ~~March 31,~~June 30, 2023 were as follows:


	Maturities of Lease Liabilities						Maturities of Lease Liabilities
	Operating		Finance				Operating		Finance
For the Years Ending December 31,	Leases		Leases		Total		Leases		Leases		Total

	(In thousands)						(In thousands)
2023 (remaining nine months)	$	40,376	$	32,234	$	72,610
2023 (remaining six months)							$	25,739	$	21,431	$	47,170
2024		34,976		32,147		67,123		36,287		32,147		68,434
2025		19,078		—		19,078		20,408		—		20,408
2026		10,723		—		10,723		11,548		—		11,548
2027		6,223		—		6,223		6,574		—		6,574
Thereafter		23,412		—		23,412		23,353		—		23,353
Total lease payments		134,788		64,381		199,169		123,909		53,578		177,487
Less: Imputed interest		(21,734)		(4,328)		(26,062)		(20,642)		(2,991)		(23,633)
Total		113,054		60,053		173,107		103,267		50,587		153,854
Less: Current portion		(46,419)		(39,060)		(85,479)		(41,535)		(39,960)		(81,495)
Long-term portion of lease obligations	$	66,635	$	20,993	$	87,628	$	61,732	$	10,627	$	72,359

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8.	Long-Term Debt and Finance Lease Obligations

Fair Value of our Long-Term Debt

The following table summarizes the carrying amount and fair value of our debt facilities as of ~~March 31,~~June 30, 2023 and December 31, 2022:


	As of								As of
	March 31, 2023				December 31, 2022				June 30, 2023				December 31, 2022
	Carrying Amount		Fair Value		Carrying Amount		Fair Value		Carrying Amount		Fair Value		Carrying Amount		Fair Value

	(In thousands)								(In thousands)
5% Senior Notes due 2023 (1)	$	—	$	—	$	1,443,179	$	1,441,635	$	—	$	—	$	1,443,179	$	1,441,635
5 7/8% Senior Notes due 2024		2,000,000		1,786,400		2,000,000		1,870,940		2,000,000		1,767,940		2,000,000		1,870,940
7 3/4% Senior Notes due 2026		2,000,000		1,327,960		2,000,000		1,620,280		2,000,000		1,239,220		2,000,000		1,620,280
5 1/4% Senior Secured Notes due 2026		2,750,000		2,195,105		2,750,000		2,336,813		2,750,000		2,217,655		2,750,000		2,336,813
7 3/8% Senior Notes due 2028		1,000,000		574,040		1,000,000		708,320		1,000,000		541,430		1,000,000		708,320
5 3/4% Senior Secured Notes due 2028		2,500,000		1,862,275		2,500,000		2,013,675		2,500,000		1,878,475		2,500,000		2,013,675
5 1/8% Senior Notes due 2029		1,500,000		805,680		1,500,000		976,755		1,500,000		705,975		1,500,000		976,755
Other notes payable		18,329		18,329		18,329		18,329		18,329		18,329		18,329		18,329
Subtotal		11,768,329	$	8,569,789		13,211,508	$	10,986,747		11,768,329	$	8,369,024		13,211,508	$	10,986,747
Unamortized deferred financing costs and debt discounts, net		(33,358)				(35,206)				(30,250)				(35,206)
Finance lease obligations (2)		60,053				69,206				50,587				69,206
Total long-term debt and finance lease obligations (including current portion)	$	11,795,024			$	13,245,508			$	11,788,666			$	13,245,508

(1)	We had repurchased or redeemed the principal balance of our 5% Senior Notes due 2023 as of March 15, 2023, the instrument’s maturity date.

(2)	Disclosure regarding fair value of finance leases is not required.

We estimated the fair value of our publicly traded long-term debt using market prices in less active markets (Level 2).

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(Unaudited)

9.	Commitments and Contingencies

Commitments

Future maturities of our long-term debt, finance lease and contractual obligations as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2022 have not changed materially, other than those disclosed below.

“Other long-term obligations” totaled ~~$4.601~~$4.150 billion as of ~~March 31,~~June 30, 2023 and $5.146 billion as of December 31, 2022, a decrease of ~~$545~~$996 million as of ~~March 31,~~June 30, 2023. This decrease primarily resulted from payments ~~during the first quarter of 2023.~~made for 2023 obligations. As of ~~March 31,~~June 30, 2023, our future “Other long-term obligations” were as follows:


For the Years Ending December 31,	Other Long-Term Obligations (1)		Other Long-Term Obligations (1)
	(In thousands)		(In thousands)
2023 (remaining nine months)	$	1,922,609
2023 (remaining six months)			$	1,412,393
2024		1,289,203		1,348,518
2025		739,613		739,613
2026		524,473		524,473
2027		125,084		125,084
Thereafter		—		—
Total	$	4,600,982	$	4,150,081

(1)

Represents obligations ~~for certain expenses~~ associated with DISH Network’s Wireless segment and satellite related and other obligations.

In certain circumstances, the dates on which we are obligated to make these payments could be delayed.

Our commitments include certain obligations incurred by us on behalf of DISH Network’s Wireless segment. These obligations will be either paid directly by DISH Network or settled monthly as part of our centralized cash management system with our parent, DISH Network. See Note 3 for further information.

On March 20, 2023, DISH Network entered into a contract with Maxar Space LLC for the construction of EchoStar XXV, a DBS satellite that is capable of providing service to the continental United States (“CONUS”) and is intended to be used at the 110 degree orbital location. This satellite is expected to be launched during 2026. The satellite construction costs for EchoStar XXV and any future lease obligations are not included in “Other long-term obligations” above.

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DISH Network’s Spectrum and 5G Network Deployment

DISH Network has invested a total of over $30 billion in wireless spectrum licenses, which includes over $10 billion in noncontrolling investments in certain entities.

~~DISH Network Spectrum~~

~~DISH Network has invested a total of over $30~~ ~~billion to acquire certain wireless spectrum licenses.~~ DISH Network’s wireless spectrum licenses are subject to certain interim and final build-out requirements, as well as certain renewal requirements. DISH Network plans to commercialize its wireless spectrum licenses through the completion of the nation’s first cloud-native, Open Radio Access Network (“O-RAN”) based 5G network (the “5G Network Deployment”). DISH Network currently expects capital expenditures, excluding capitalized interest, for its 5G Network Deployment to be approximately $10 billion, including amounts incurred in 2021, 2022 and in the first ~~three~~six months of 2023. DISH Network may need to make significant additional investments or partner with others to, among other things, ~~complete~~continue its 5G Network Deployment and further commercialize, build-out and integrate these licenses and related assets and any additional acquired licenses and related assets, as well as to comply with regulations applicable to such licenses. Depending on the nature and scope of such activities, any such investments or partnerships could vary significantly.

In addition, as DISH Network ~~completes~~continues its 5G Network Deployment, DISH Network has and ~~will~~may continue to incur significant additional expenses related to, among other things, research and development, wireless testing and ongoing upgrades to the wireless network infrastructure, software and ~~third party~~third-party integration. DISH Network may also determine that additional wireless spectrum licenses may be required ~~to complete~~for its 5G Network Deployment and to compete effectively with other wireless service providers.

In connection with the development of DISH Network’s wireless business, including, without limitation, the efforts described above, we have made cash distributions and the Intercompany Loan to partially finance these efforts to date and may make additional cash distributions or loans to finance, in whole or in part, DISH Network’s future efforts. There can be no assurance that DISH Network will be able to develop and implement a business model that will realize a return on these wireless spectrum licenses or that DISH Network will be able to profitably deploy the assets represented by these wireless spectrum licenses.

Agreements in Connection with the Asset Purchase Agreement

On July 1, 2020, DISH Network completed the Boost Mobile Acquisition. In connection with the closing of the Boost Mobile Acquisition, DISH Network and T-Mobile entered into, among other things, the Spectrum Purchase Agreement (as defined in DISH Network’s Annual Report on Form 10-K for the year ended December 31, 2021) for approximately $3.59 billion. If DISH Network elects to not exercise the option to purchase the 800 MHz licenses pursuant to the Spectrum Purchase Agreement or it expires, DISH Network is potentially subject to pay T-Mobile a fee of approximately $72 million per the Spectrum Purchase Agreement, under certain circumstances. The $3.59 billion and the $72 million are not included in “Other long-term obligations” above.

On June 30, 2023, the Department of Justice provided notice to the United States District Court for the District of Columbia that, pursuant to its discretion under the Final Judgment, it granted a 60-day extension of the deadline for T-Mobile to divest the 800 MHz spectrum licenses, which expires on August 30, 2023. DISH Network is currently in negotiations with T-Mobile.

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DISH Network Noncontrolling Investments in the Northstar Entities and the SNR Entities Related to AWS-3 Wireless Spectrum Licenses

During 2015, through its wholly-owned subsidiaries American AWS-3 Wireless II L.L.C. (“American II”) and American AWS-3 Wireless III L.L.C. (“American III”), DISH Network initially made over $10 billion in certain noncontrolling investments in Northstar Spectrum, LLC (“Northstar Spectrum”), the parent company of Northstar Wireless, LLC (“Northstar Wireless,” and collectively with Northstar Spectrum, the “Northstar Entities”), and in SNR Wireless HoldCo, LLC (“SNR HoldCo”), the parent company of SNR Wireless LicenseCo, LLC (“SNR Wireless,” and collectively with SNR HoldCo, the “SNR Entities”), respectively. On October 27, 2015, the FCC granted certain AWS-3 wireless spectrum licenses (the “AWS-3 Licenses”) to Northstar Wireless (the “Northstar Licenses”) and to SNR Wireless (the “SNR Licenses”), respectively. The Northstar Entities and/or the SNR Entities may need to raise significant additional capital in the future, which may be obtained from ~~third party~~third-party sources or from DISH Network, so that the Northstar Entities and the SNR Entities may commercialize, build-out and integrate these AWS-3 Licenses, comply with regulations applicable to such AWS-3 Licenses, and make any potential payments related to the re-auction of AWS-3 licenses retained by the FCC. Depending upon the nature and scope of such commercialization, build-out and integration efforts, regulatory compliance, and potential re-auction payments, any such loans, equity contributions or partnerships could vary significantly. For further information regarding the potential re-auction of AWS-3 licenses retained by the FCC, see Note 10 “Commitments – DISH Network Noncontrolling Investments in the Northstar Entities and the SNR Entities Related to AWS-3 Wireless Spectrum Licenses” in the Notes to DISH Network’s Quarterly Report on Form 10-Q for the quarter ended ~~March 31,~~June 30, 2023.

We have made and may make additional cash distributions and loans to DISH Network so that DISH Network may fund the Northstar Entities and the SNR Entities related to DISH Network’s noncontrolling investments in these entities. There can be no assurance that DISH Network will be able to obtain a profitable return on its noncontrolling investments in the Northstar Entities and the SNR Entities.

We may need to raise significant additional capital in the future, which may not be available on favorable terms, to among other things, continue investing in our business and to pursue acquisitions and other strategic transactions.

See Note 10 “Commitments and Contingencies – Wireless – 5G Network Deployment” in the Notes to DISH Network’s Quarterly Report on Form 10-Q for the quarter ended ~~March 31,~~June 30, 2023 for further information.

Contingencies

Separation Agreement

On January 1, 2008, DISH Network completed the distribution of its technology and set-top box business and certain infrastructure assets (the “Spin-off”) into a separate publicly-traded company, EchoStar. In connection with the Spin-off, DISH Network entered into a separation agreement with EchoStar that provides, among other things, for the division of certain liabilities, including liabilities resulting from litigation. Under the terms of the separation agreement, EchoStar has assumed certain liabilities that relate to its business, including certain designated liabilities for acts or omissions that occurred prior to the Spin-off. Certain specific provisions govern intellectual property related claims under which, generally, EchoStar will only be liable for its acts or omissions following the Spin-off and DISH Network will indemnify EchoStar for any liabilities or damages resulting from intellectual property claims relating to the period prior to the Spin-off, as well as DISH Network’s acts or omissions following the Spin-off.

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On February 28, 2017, DISH Network and EchoStar and certain of their respective subsidiaries completed the transactions contemplated by the Share Exchange Agreement (the “Share Exchange Agreement”) that was previously entered into on January 31, 2017 (the “Share Exchange”), pursuant to which certain assets that were transferred to EchoStar in the Spin-off were transferred back to DISH Network. On September 10, 2019, DISH Network and EchoStar and certain of their respective subsidiaries completed the transactions contemplated by the Master Transaction Agreement (the “Master Transaction Agreement”) that was previously entered into on May 19, 2019, pursuant to which certain assets that were transferred to EchoStar in the Spin-off were transferred back to DISH Network. The Share Exchange Agreement and the Master Transaction Agreement contain additional indemnification provisions between DISH Network and EchoStar for certain liabilities and legal proceedings.

Litigation

We are involved in a number of legal proceedings (including those described below) concerning matters arising in connection with the conduct of our business activities. Many of these proceedings are at preliminary stages, and many of these proceedings seek an indeterminate amount of damages. We regularly evaluate the status of the legal proceedings in which we are involved to assess whether a loss is probable or there is a reasonable possibility that a loss or an additional loss may have been incurred and to determine if accruals are appropriate. If accruals are not appropriate, we further evaluate each legal proceeding to assess whether an estimate of the possible loss or range of possible loss can be made.

For certain cases described on the following pages, management is unable to provide a meaningful estimate of the possible loss or range of possible loss because, among other reasons: (i) the proceedings are in various stages; (ii) damages have not been sought; (iii) damages are unsupported and/or exaggerated; (iv) there is uncertainty as to the outcome of pending appeals or motions; (v) there are significant factual issues to be resolved; and/or (vi) there are novel legal issues or unsettled legal theories to be presented or a large number of parties. For these cases, however, management does not believe, based on currently available information, that the outcomes of these proceedings will have a material adverse effect on our financial condition, though the outcomes could be material to our operating results for any particular period, depending, in part, upon the operating results for such period.

ClearPlay, Inc.

On March 13, 2014, ClearPlay, Inc. (“ClearPlay”) filed a complaint against DISH Network, our wholly-owned subsidiary DISH Network L.L.C., EchoStar, and its then wholly-owned subsidiary EchoStar Technologies L.L.C., in the United States District Court for the District of Utah. The complaint alleges willful infringement of United States Patent Nos. 6,898,799 (the “799 patent”), entitled “Multimedia Content Navigation and Playback”; 7,526,784 (the “784 patent”), entitled “Delivery of Navigation Data for Playback of Audio and Video Content”; 7,543,318 (the “318 patent”), entitled “Delivery of Navigation Data for Playback of Audio and Video Content”; 7,577,970 (the “970 patent”), entitled “Multimedia Content Navigation and Playback”; and 8,117,282 (the “282 patent”), entitled “Media Player Configured to Receive Playback Filters From Alternative Storage Mediums.” ClearPlay alleges that the AutoHop^™ feature of our Hopper® set-top box infringes the asserted patents. On February 11, 2015, the case was stayed pending various third-party challenges before the United States Patent and Trademark Office regarding the validity of certain of the patents asserted in the action.

In those third-party challenges, the United States Patent and Trademark Office found that all claims of the 282 patent are unpatentable, and that certain claims of the 784 patent and 318 patent are unpatentable. ClearPlay appealed as to the 784 patent and the 318 patent, and on August 23, 2016, the United States Court of Appeals for the Federal Circuit affirmed the findings of the United States Patent and Trademark Office. On October 31, 2016, the stay was lifted, and in May 2017, ClearPlay agreed to dismiss us and EchoStar as defendants, leaving DISH Network L.L.C. and DISH Technologies L.L.C. as the sole defendants.

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(Unaudited)

On October 16, October 21, November 2, 2020 and November 9, 2020, DISH Network L.L.C. filed petitions with the United States Patent and Trademark Office requesting ex parte reexamination of the validity of the asserted claims of, respectively, the 784 patent, the 799 patent, the 318 patent and the 970 patent; and on November 2, November 20, December 14 and December 15, 2020, the United States Patent and Trademark Office granted each request for reexamination. On May 7, 2021, May 25, 2021, June 25, 2021 and July 7, 2021, the United States Patent and Trademark Office issued Ex Parte Reexamination Certificates confirming the patentability of the challenged claims of, respectively, the 799 patent, the 784 patent, the 318 patent and the 970 patent.

In October and November 2021, DISH Network L.L.C. filed petitions with the United States Patent and Trademark Office requesting ex parte reexamination of the validity of certain asserted claims of the 784 patent, the 799 patent and the 970 patent. In November and December, 2021, the United States Patent and Trademark Office granted review of the challenged claims of the 799 patent and the 970 patent, but denied review of the challenged claims of the 784 patent. In December 2021, DISH Network L.L.C. petitioned for review of the denial as to the 784 patent. On January 24, 2022, an examiner of the United States Patent and Trademark Office affirmed the challenged claims of the 799 patent, and on January 19, 2023, an examiner of the United States Patent and Trademark Office affirmed the challenged claims of the 970 patent.

In an order dated January 31, 2023, the Court granted in part and denied in part DISH Network L.L.C.’s and DISH Technologies L.L.C.’s motion for summary judgment. Thereafter, ClearPlay narrowed its case to three asserted claims: one under the 799 patent and two under the 970 patent. Following a two-week trial, on March 10, 2023, the jury returned a verdict that DISH Network L.L.C. and DISH Technologies L.L.C. infringed each of the asserted patent claims (though not willfully), and awarded damages of $469 million. That verdict became moot on March 21, 2023, when the trial court indicated that it would grant DISH Network L.L.C.’s and DISH Technologies L.L.C.’s motion for judgment as a matter of law, thus effectively vacating the jury award. ~~DISH Network L.L.C. and DISH Technologies L.L.C. have submitted a proposed form of~~On June 2, 2023, the Court entered its formal order granting ~~the motion.~~judgment as a matter of law.

We intend to vigorously defend this case. In the event that a court ultimately determines that we infringe the asserted patents, we may be subject to substantial damages, which may include treble damages, and/or an injunction that could require us to materially modify certain features that we currently offer to consumers. We cannot predict with any degree of certainty the outcome of the suit or determine the extent of any potential liability or damages.

Cyber-security Class Actions

On May 9, 2023, Susan Owen-Brooks, an alleged customer, filed a putative class action complaint against DISH Network in the United States District Court for the District of Colorado. She purports to represent a nationwide class of all individuals in the United States who allegedly had private information stolen as a result of the February 23, 2023 Cyber-security Incident (and a North Carolina statewide subclass of the same individuals). On behalf of the nationwide class, she alleges claims for contractual breaches, negligence and unjust enrichment (and, on behalf of the North Carolina subclass only, violation of the North Carolina Deceptive Trade Practices Act), and seeks monetary damages, injunctive relief and a declaratory judgment. Since that filing, ten additional putative class action complaints have been filed in the United States District Court for the District of Colorado, purporting to represent the same nationwide class of people, and Owen-Brooks has filed an amended complaint. Certain of the plaintiffs have filed a motion to have the cases consolidated.

DISH Network intends to vigorously defend this case. DISH Network cannot predict with any degree of certainty the outcome of the suit or determine the extent of any potential liability or damages.

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Digital Broadcasting Solutions, LLC

On August 29, 2022, Digital Broadcasting Solutions, LLC filed a complaint against our wholly-owned subsidiaries DISH Network L.L.C. and DISH Technologies L.L.C. in the United States District Court for the Eastern District of Texas. The complaint alleges infringement of U.S. Patent No. 8,929,710 (the “710 patent”) and U.S. Patent No. 9,538,122 (the “122 patent”), each entitled “System and method for time shifting at least a portion of a video program.” Generally, the plaintiff contends that the AutoHop feature of our Hopper® set-top boxes infringes the asserted patents. ~~The~~On June 21, 2023, the Court ~~has set~~granted the motion of DISH Network L.L.C. and DISH Technologies L.L.C. to have the case transferred to the United States District Court for ~~trial on April 1, 2024.~~the District of Colorado.

In May 2023, DISH Network L.L.C. and DISH Technologies L.L.C. filed petitions with the United States Patent and Trademark Office challenging the validity of all claims of the 710 patent and the 122 patent.

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~~(Unaudited)~~

Entropic Communications, LLC (first action)

On March 9, 2022, Entropic Communications, LLC (“Entropic”) filed a complaint against DISH Network and our wholly-owned subsidiaries DISH Network L.L.C. and Dish Network Service L.L.C. in the United States District Court for the Eastern District of Texas. The complaint alleges infringement of U.S. Patent No. 7,130,576 (the “576 patent”), entitled “Signal Selector and Combiner for Broadband Content Distribution”; U.S. Patent No. 7,542,715 (the “715 Patent”), entitled “Signal Selector and Combiner for Broadband Content Distribution”; and U.S. Patent No. 8,792,008 (the “008 Patent”), entitled “Method and Apparatus for Spectrum Monitoring.” On March 30, 2022, Entropic filed an amended complaint alleging infringement of the same patents. Generally, the plaintiff accuses satellite antennas, low-noise block converters, signal selector and combiners, and set-top boxes and the manner in which they process signals for satellite television customers of infringing the asserted patents. On October 24, 2022, this case was ordered to be transferred to the United States District Court for the Central District of California. A companion case against DirecTV was also ordered transferred to the United States District Court for the Central District of California.

In January and February of 2023, DISH Network L.L.C. and Dish Network Service L.L.C. filed petitions with the United States Patent and Trademark Office challenging the validity of all claims of the 715 patent, all claims of the 008 patent, and 25 claims of the 576 patent, which includes all of its asserted claims.

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Entropic Communications, LLC (second action)

On February 10, 2023, Entropic filed a second lawsuit against DISH Network and our wholly-owned subsidiaries DISH Network L.L.C., Dish Network Service L.L.C. and Dish Network California Service Corporation in the United States District Court for the Central District of California. The complaint alleges infringement of U.S. Patent No. 7,295,518 (the “518 patent”), entitled “Broadband network for coaxial cable using multi-carrier modulation”; U.S. Patent No. 7,594,249 (the “249 patent”), entitled “Network interface device and broadband local area network using coaxial cable”; U.S. Patent Nos. 7,889,759 (the “759 patent”), entitled “Broadband cable network utilizing common bit-loading”; U.S. Patent No. 8,085,802 (the “802 Patent”), entitled “Multimedia over coaxial cable access protocol”; U.S. Patent No. 9,838,213 (the “213 patent”), entitled “Parameterized quality of service architecture in a network”; U.S. Patent No. 10,432,422 (the “422 patent”), entitled “Parameterized quality of service architecture in a network”; U.S. Patent No. 8,631,450 (the “450 patent”), entitled “Broadband local area network”; U.S. Patent No. 8,621,539 (the “539 patent”), entitled “Physical layer transmitter for use in a broadband local area network”; U.S. Patent No. 8,320,566 (the “0,566 patent”), entitled “Method and apparatus for performing constellation scrambling in a multimedia home network”; U.S. Patent No. 10,257,566 (the “7,566 patent”), entitled “Broadband local area network”; U.S. Patent No. 8,228,910 (the “910 Patent”), entitled “Aggregating network packets for transmission to a destination mode”; and U.S. Patent No. 8,363,681 (the “681 patent”), entitled “Method and apparatus for using ranging measurements in a multimedia home network.” Generally, the patents relate to Multimedia over Coax Alliance standards and the manner in which we provide a whole-home DVR network over an on-premises coaxial cable network. Entropic has asserted the same patents in the same court against Comcast, Cox and ~~Cox.~~DirecTV.

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Freedom Patents

On April 7, 2023, Freedom Patents LLC filed a complaint against DISH Network and our wholly-owned subsidiaries DISH Network L.L.C. and Dish Network Service L.L.C. in the United States District Court for the Eastern District of Texas. The complaint alleges infringement of U.S. Patent No. 8,284,686 (the “686 Patent”), entitled “Antenna/Beam Selection Training in MIMO Wireless LANS with Different Sounding Frames”; U.S. Patent No. 8,374,096 (the “096 Patent”), entitled “Method for Selecting Antennas and Beams in MIMO Wireless LANs”; and U.S. Patent No. 8,514,815 (the “815 Patent”), entitled “Training Signals for Selecting Antennas and Beams in MIMO Wireless LANs.” Similar complaints were also filed against Acer, Altice, Charter, Comcast and Verizon. In general, the asserted patents relate to the 802.11 wireless standard, and the products accused of infringement are the Wireless Joey, its access point, and certain Ring, Nest and Linksys products that we sell.

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Jaramillo (Cyber-security Securities Class Action)

On March 23, 2023, a securities fraud class action complaint was filed against DISH Network and Messrs. Ergen, Carlson and Orban in the United States District Court for the District of Colorado. The complaint is brought on behalf of a putative class of purchasers of DISH Network’s securities during the February 22, 2021 to February 27, 2023 class period. In general, the complaint alleges that DISH Network’s public statements during that period were false and misleading and contained material omissions, because they did not disclose that we allegedly maintained a deficient cyber-security and information technology infrastructure, were unable to properly secure customer data and our operations were susceptible to widespread service outages.

DISH Network ~~intend~~intends to vigorously defend this case. WeDISH Network cannot predict with any degree of certainty the outcome of the suit or determine the extent of any potential liability or damages.

Jones 401(k) Litigation

On December 20, 2021, four former employees filed a class action complaint in the United States District Court for the District of Colorado against DISH Network, DISH Network’s Board of Directors, and DISH Network’s Retirement Plan Committee alleging fiduciary breaches arising from the management of our 401(k) Plan. The putative class, comprised of all participants in the Plan on or after January 20, 2016, alleges that the Plan had excessive recordkeeping and administrative expenses and that it maintained underperforming funds. On February 1, 2023, a Magistrate Judge issued a ~~Recommendation~~recommendation that the defendants’ motion to dismiss the complaint be granted, and on March 27, 2023, the district court judge granted the motion. As permitted by the Court’s order, the plaintiffs filed an amended complaint on April 10, 2023, which is limited to allegations regarding the alleged underperformance of the Fidelity Freedom Funds.

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~~DISH Network intends to vigorously defend this case. DISH Network cannot predict with any degree of certainty the outcome of the suit or determine the extent of any potential liability or damages.~~

~~Owen-Brooks~~

DISH Network intends to vigorously defend this case. DISH Network cannot predict with any degree of certainty the outcome of the suit or determine the extent of any potential liability or damages.

Realtime Data LLC and Realtime Adaptive Streaming LLC

On June 6, 2017, Realtime Data LLC d/b/a IXO (“Realtime”) filed an amended complaint in the United States District Court for the Eastern District of Texas (the “Original Texas Action”) against DISH Network; our wholly-owned subsidiaries DISH Network L.L.C., DISH Technologies L.L.C. (then known as EchoStar Technologies L.L.C.), Sling TV L.L.C. and Sling Media L.L.C.; EchoStar, and EchoStar’s wholly-owned subsidiary Hughes Network Systems, L.L.C. (“HNS”); and Arris Group, Inc. Realtime’s initial complaint in the Original Texas Action, filed on February 14, 2017, had named only EchoStar and HNS as defendants. The amended complaint in the Original Texas Action alleges infringement of United States Patent No. 8,717,204 (the “204 patent”), entitled “Methods for encoding and decoding data”; United States Patent No. 9,054,728 (the “728 patent”), entitled “Data compression systems and methods”; United States Patent No. 7,358,867 (the “867 patent”), entitled “Content independent data compression method and system”; United States Patent No. 8,502,707 (the “707 patent”), entitled “Data compression systems and methods”; United States Patent No. 8,275,897 (the “897 patent”), entitled “System and methods for accelerated data storage and retrieval”; United States Patent No. 8,867,610 (the “610 patent”), entitled “System and methods for video and audio data distribution”; United States Patent No. 8,934,535 (the “535 patent”), entitled “Systems and methods for video and audio data storage and distribution”; and United States Patent No. 8,553,759 (the “759 patent”), entitled “Bandwidth sensitive data compression and decompression.”

Realtime alleges that DISH Network, Sling TV L.L.C., Sling Media L.L.C. and Arris Group, Inc.’s streaming video products and services compliant with various versions of the H.264 video compression standard infringe the 897 patent, the 610 patent and the 535 patent, and that the data compression system in Hughes’ products and services infringes the 204 patent, the 728 patent, the 867 patent, the 707 patent and the 759 patent.

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On July 19, 2017, the Court severed Realtime’s claims against DISH Network, DISH Network L.L.C., Sling TV L.L.C., Sling Media L.L.C. and Arris Group, Inc. (alleging infringement of the 897 patent, the 610 patent and the 535 patent) from the Original Texas Action into a separate action in the United States District Court for the Eastern District of Texas (the “Second Texas Action”). On August 31, 2017, Realtime dismissed the claims against DISH Network, Sling TV L.L.C., Sling Media Inc., and Sling Media L.L.C. from the Second Texas Action and refiled these claims (alleging infringement of the 897 patent, the 610 patent and the 535 patent) against Sling TV L.L.C., Sling Media Inc., and Sling Media L.L.C. in a new action in the United States District Court for the District of Colorado (the “Colorado Action”). Also on August 31, 2017, Realtime dismissed DISH Technologies L.L.C. from the Original Texas Action, and on September 12, 2017, added it as a defendant in an amended complaint in the Second Texas Action. On November 6, 2017, Realtime filed a joint motion to dismiss the Second Texas Action without prejudice, which the Court entered on November 8, 2017.

On October 10, 2017, Realtime Adaptive Streaming LLC (“Realtime Adaptive Streaming”) filed suit against our wholly-owned subsidiaries DISH Network L.L.C. and DISH Technologies L.L.C., as well as Arris Group, Inc., in a new action in the United States District Court for the Eastern District of Texas (the “Third Texas Action”), alleging infringement of the 610 patent and the 535 patent. Also on October 10, 2017, an amended complaint was filed in the Colorado Action, substituting Realtime Adaptive Streaming as the plaintiff instead of Realtime, and alleging infringement of only the 610 patent and the 535 patent, but not the 897 patent. On November 6, 2017, Realtime Adaptive Streaming filed a joint motion to dismiss the Third Texas Action without prejudice, which the court entered on November 8, 2017. Also on November 6, 2017, Realtime Adaptive Streaming filed a second amended complaint in the Colorado Action, adding our wholly-owned subsidiaries DISH Network L.L.C. and DISH Technologies L.L.C., as well as Arris Group, Inc., as defendants.

As a result, neither DISH Network nor any of its subsidiaries is a defendant in the Original Texas Action; the Court has dismissed without prejudice the Second Texas Action and the Third Texas Action; and our wholly-owned subsidiaries DISH Network L.L.C., DISH Technologies L.L.C., Sling TV L.L.C. and Sling Media L.L.C. as well as Arris Group, Inc., are defendants in the Colorado Action, which now has Realtime Adaptive Streaming as the named plaintiff. Following a settlement with the plaintiff, Arris Group, Inc. was dismissed from the action on March 10, 2021.

On July 3, 2018, Sling TV L.L.C., Sling Media L.L.C., DISH Network L.L.C., and DISH Technologies L.L.C. filed petitions with the United States Patent and Trademark Office challenging the validity of each of the asserted patents. On January 31, 2019, the United States Patent and Trademark Office agreed to institute proceedings on our petitions, and it held trial on the petitions on December 5, 2019. On January 17, 2020, the United States Patent and Trademark Office terminated the petitions as time-barred, but issued a final written decision invalidating the 535 patent to third parties that had timely joined in our petition (and, on January 10, 2020, issued a final written decision invalidating the 535 patent in connection with a ~~third party’s~~third-party’s independent petition). On March 16, 2020, Sling TV L.L.C., Sling Media L.L.C., DISH Network L.L.C., and DISH Technologies L.L.C. filed a notice of appeal from the terminated petitions to the United States Court of Appeals for the Federal Circuit. On June 29, 2020, the United States Patent and Trademark Office filed a notice of intervention in the appeal. On March 16, 2021, the Court of Appeals dismissed the appeal for lack of jurisdiction. On April 29, 2021, Sling TV L.L.C., Sling Media L.L.C., DISH Network L.L.C., and DISH Technologies L.L.C. filed a petition for rehearing, which was denied on June 28, 2021. On January 12, 2021, Realtime Adaptive Streaming filed a notice of dismissal of its claims on the 535 patent.

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On July 30, 2021, the District Court granted summary judgment in favor of DISH Network L.L.C., DISH Technologies L.L.C., Sling TV L.L.C. and Sling Media L.L.C., holding that the remaining asserted patent, the 610 patent, is invalid because it claims patent-ineligible abstract subject matter. Realtime Adaptive Streaming ~~filed a notice of appeal from~~appealed that ruling to the United States Court of Appeals for the Federal Circuit, ~~but~~and on May 11, 2023, that ~~court summarily~~Court affirmed the District Court’s ~~ruling.~~summary judgment order. Independently, on September 21, 2021, in connection with an ex parte reexamination of the validity of the 610 patent, an examiner at the United States Patent and Trademark Office issued a final office action rejecting each asserted claim of the 610 patent as invalid over the cited prior art. On April 19, 2023, the Patent Trial and Appeal Board rejected Realtime Adaptive Streaming’s appeal and affirmed the examiner’s rejection of the asserted claims of the 610 patent. Realtime did not further appeal the Patent Trial and Appeal Board’s determination and, thus, the asserted claims of the 610 patent will be canceled. As a result, DISH Network L.L.C., DISH Technologies L.L.C., Sling TV L.L.C. and Sling Media L.L.C. no longer face any possible exposure from this matter, and the liability phase of this case is concluded.

On January 21, 2022, the District Court granted the motion by DISH Network L.L.C., DISH Technologies L.L.C., Sling TV L.L.C. and Sling Media L.L.C. to have the case declared “exceptional,” and on September 20, 2022, awarded them $3.9 million in attorneys’ fees. Realtime Adaptive Streaming filed a notice of appeal to the United States Court of Appeals for the Federal Circuit from the exceptionality and fee award orders, and ~~briefing~~that appeal is underway. Independently, on September 21, 2021, in connection with an ex parte reexamination of the validity of the 610 patent, an examiner at the United States Patent and Trademark Office issued a final office action rejecting each asserted claim of the 610 patent. ~~On April 19, 2023, the Patent Trial and Appeal Board rejected Realtime Adaptive Streaming’s appeal and affirmed the examiner’s rejection of the asserted claims of the 610 patent.~~

SafeCast Limited

On June 27, 2022, SafeCast Limited filed a complaint against DISH Network in the United States District Court for the Western District of Texas. The complaint alleges that DISH Network infringes U.S. Patent No. 9,392,302, entitled “System for providing improved facilities in time-shifted ~~broadcasts.”~~broadcasts” (the “302 patent”). On the same day, it brought complaints in the same court asserting infringement of the same patent against AT&T, Google, HBO, NBCUniversal, Paramount and Verizon. On October 24, 2022, in response to the parties’ joint motion, the Court ordered the case against DISH Network transferred to the United States District Court for the District of Colorado. On December 1, 2022, SafeCast filed an amended complaint naming DISH Network L.L.C. and DISH Technologies L.L.C. as defendants and withdrawing the allegations as to DISH Network. On June 22, 2023, DISH Network L.L.C. and DISH Technologies L.L.C. filed a petition with the United States Patent and Trademark Office challenging the validity of the asserted claims of the 302 patent.

DISH Network intends to vigorously defend this case. In the event that a court ultimately determines that we infringe the asserted patent, we may be subject to substantial damages, which may include treble damages, and/or an injunction that could require us to materially modify certain features that we currently offer to consumers. We cannot predict with any degree of certainty the outcome of the suit or determine the extent of any potential liability or damages. The plaintiff is an entity that seeks to license a patent portfolio without itself practicing any of the claims recited therein.

Sound View Innovations, LLC

On December 30, 2019, Sound View Innovations, LLC filed one complaint against our wholly-owned subsidiaries DISH Network L.L.C. and DISH Technologies L.L.C. and a second complaint against our wholly-owned subsidiary Sling TV L.L.C. in the United States District Court for the District of Colorado. The complaint against DISH Network L.L.C. and DISH Technologies L.L.C. alleges infringement of United States Patent No 6,502,133 (the “133 patent”), entitled “Real-Time Event Processing System with Analysis Engine Using Recovery Information” and both complaints allege infringement of United States Patent No. 6,708,213 (the “213 patent), entitled “Method for Streaming Multimedia Information Over Public Networks”; United States Patent No. 6,757,796 (the “796 patent”), entitled “Method and System for Caching Streaming Live Broadcasts transmitted Over a Network”; and United States Patent No. 6,725,456 (the “456 patent”), entitled “Methods and Apparatus for Ensuring Quality of Service in an Operating System.” All but the 133 patent are also asserted in the complaint against Sling TV L.L.C.

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On May 21, 2020, June 3, 2020, June 5, 2020 and July 10, 2020, DISH Network L.L.C., DISH Technologies L.L.C. and Sling TV L.L.C. filed petitions with the United States Patent and Trademark Office challenging the validity of, respectively, the 213 patent, the 133 patent, the 456 patent and the 796 patent. On November 25, 2020, the United States Patent and Trademark Office declined to review the validity of the 213 patent, and on September 29, 2021, denied a request for rehearing of that decision. On January 19, 2021, the United States Patent and Trademark Office agreed to institute proceedings on the 456 patent but declined to review the 133 patent. On February 24, 2021, the United States Patent and Trademark Office agreed to institute proceedings on the 796 patent. On January 18, 2022, the United States Patent and Trademark Office issued a final written decision holding that the challenged claim of the 456 patent is patentable, and on February 8, 2022, it issued a final written decision holding that the challenged claims of the 796 patent are patentable.

On March 22, 2022, DISH Network L.L.C., DISH Technologies L.L.C. and Sling TV L.L.C. filed a notice of appeal to the United States Court of Appeals for the Federal Circuit from the adverse final written decision regarding the 456 patent, and on April 8, 2022, they filed a notice of appeal to the same court from the adverse final written decision regarding the 796 patent. The appeal on the 456 patent was voluntarily dismissed on December 6, 2022. Appellate briefing on the 796 appeal was completed on January 19, 2023.

On April 20, 2022, DISH Network L.L.C., DISH Technologies L.L.C. and Sling TV L.L.C. filed a petition with the United States Patent and Trademark Office requesting ex parte reexamination of the validity of one of the asserted claims of the 213 patent, and reexamination was ordered on June 16, 2022. On January 18, 2023, they filed another petition requesting ex parte reexamination of the validity of the four additional asserted claims of the 213 ~~patent.~~patent, and reexamination was ordered on April 17, 2023.

We intend to vigorously defend these cases. In the event that a court ultimately determines that we infringe the asserted patents, we may be subject to substantial damages, which may include treble damages, and/or an injunction that could require us to materially modify certain features that we currently offer to consumers. We cannot predict with any degree of certainty the outcome of the suit or determine the extent of any potential liability or damages. The plaintiff is an entity that seeks to license a patent portfolio without itself practicing any of the claims recited therein.

TQ Delta, LLC

On July 17, 2015, TQ Delta, LLC (“TQ Delta”) filed a complaint against us, DISH Network and our wholly-owned subsidiary DISH Network L.L.C. in the United States District Court for the District of Delaware. The Complaint alleges infringement of United States Patent No. 6,961,369 (the “369 patent”), which is entitled “System and Method for Scrambling the Phase of the Carriers in a Multicarrier Communications System”; United States Patent No. 8,718,158 (the “158 patent”), which is entitled “System and Method for Scrambling the Phase of the Carriers in a Multicarrier Communications System”; United States Patent No. 9,014,243 (the “243 patent”), which is entitled “System and Method for Scrambling Using a Bit Scrambler and a Phase Scrambler”; United States Patent No. 7,835,430 (the “430 patent”), which is entitled “Multicarrier Modulation Messaging for Frequency Domain Received Idle Channel Noise Information”; United States Patent No. 8,238,412 (the “412 patent”), which is entitled “Multicarrier Modulation Messaging for Power Level per Subchannel Information”; United States Patent No. 8,432,956 (the “956 patent”), which is entitled “Multicarrier Modulation Messaging for Power Level per Subchannel Information”; and United States Patent No. 8,611,404 (the “404 patent”), which is entitled “Multicarrier Transmission System with Low Power Sleep Mode and Rapid-On Capability.”

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On September 9, 2015, TQ Delta filed a first amended complaint that added allegations of infringement of United States Patent No. 9,094,268 (the “268 patent”), which is entitled “Multicarrier Transmission System With Low Power Sleep Mode and Rapid-On Capability.” On May 16, 2016, TQ Delta filed a second amended complaint that added EchoStar Corporation and its then wholly-owned subsidiary EchoStar Technologies L.L.C. as defendants. TQ Delta alleges that our satellite TV service, Internet service, set-top boxes, gateways, routers, modems, adapters and networks that operate in accordance with one or more Multimedia over Coax Alliance Standards infringe the asserted patents. TQ Delta has filed actions in the same court alleging infringement of the same patents against Comcast Corp., Cox Communications, Inc., DirecTV, Time Warner Cable Inc. and Verizon Communications, Inc. TQ Delta is an entity that seeks to license an acquired patent portfolio without itself practicing any of the claims recited therein.

On July 14, 2016, TQ Delta stipulated to dismiss with prejudice all claims related to the 369 patent and the 956 patent. On July 20, 2016, we filed petitions with the United States Patent and Trademark Office challenging the validity of all of the patent claims of the 404 patent and the 268 patent that have been asserted against us. Third parties filed petitions with the United States Patent and Trademark Office challenging the validity of all of the patent claims that have been asserted against us in the action. On November 4, 2016, the United States Patent and Trademark Office agreed to institute proceedings on the third-party petitions related to the 158 patent, the 243 patent, the 412 patent and the 430 patent.

On December 20, 2016, pursuant to a stipulation of the parties, the Court stayed the case until the resolution of all petitions to the United States Patent and Trademark Office challenging the validity of all of the patent claims at issue. On January 19, 2017, the United States Patent and Trademark Office granted our motions to join the instituted petitions on the 430 and 158 patents.

On February 9, 2017, the United States Patent and Trademark Office agreed to institute proceedings on our petition related to the 404 patent, and on February 13, 2017, the United States Patent and Trademark Office agreed to institute proceedings on our petition related to the 268 patent. On February 27, 2017, the United States Patent and Trademark Office granted our motions to join the instituted petitions on the 243 and 412 patents. On October 26, 2017, the United States Patent and Trademark Office issued final written decisions on the petitions challenging the 158 patent, the 243 patent, the 412 patent and the 430 patent, and it invalidated all of the asserted claims of those patents. On February 7, 2018, the United States Patent and Trademark Office issued final written decisions on the petitions challenging the 404 patent, and it invalidated all of the asserted claims of that patent on the basis of our petition. On February 10, 2018, the United States Patent and Trademark Office issued a final written decision on our petition challenging the 268 patent, and it invalidated all of the asserted claims.

On March 12, 2018, the United States Patent and Trademark Office issued a final written decision on a third-party petition challenging the 268 patent, and it invalidated all of the asserted claims. All asserted claims have now been invalidated by the United States Patent and Trademark Office. TQ Delta filed notices of appeal from the final written decisions adverse to it. On May 9, 2019, the United States Court of Appeals for the Federal Circuit affirmed the invalidity of the 430 patent and the 412 patent. On July 10, 2019, the United States Court of Appeals for the Federal Circuit affirmed the invalidity of the asserted claims of the 404 patent. On July 15, 2019, the United States Court of Appeals for the Federal Circuit affirmed the invalidity of the asserted claims of the 268 patent. On November 22, 2019, the United States Court of Appeals for the Federal Circuit reversed the invalidity finding on the 243 patent and the 158 patent, and then, on March 29, 2020, denied a petition for panel rehearing as to those findings. On April 13, 2021, the Court lifted the stay, and the case is proceeding on the 243 patent and the 158 patent. On April 23 and April 26, 2021, the United States Patent and Trademark Office issued orders granting requests for ex parte reexamination of, respectively, the 243 patent and the 158 patent, but on July 27, 2023, the United States Patent and Trademark Office confirmed the challenged claims of the 243 patent. In a proposed supplemental report, TQ Delta’s damages expert contends that TQ Delta is entitled to $251 million in damages.

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Uniloc 2017 LLC

On January 31, 2019, Uniloc 2017 LLC (“Uniloc”) filed a complaint against our wholly-owned subsidiary Sling TV L.L.C. in the United States District Court for the District of Colorado. The Complaint alleges infringement of United States Patent No. 6,519,005 (the “005 patent”), which is entitled “Method of Concurrent Multiple-Mode Motion Estimation for Digital Video”; United States Patent No. 6,895,118 (the “118 patent”), which is entitled “Method of Coding Digital Image Based on Error Concealment”; United States Patent No. 9,721,273 (the “273 patent”), which is entitled “System and Method for Aggregating and Providing Audio and Visual Presentations Via a Computer Network”); and United States Patent No. 8,407,609 (the “609 patent”), which is entitled “System and Method for Providing and Tracking the Provision of Audio and Visual Presentations Via a Computer Network.”

On June 25, 2019, Sling TV L.L.C. filed a petition with the United States Patent and Trademark Office challenging the validity of all of the asserted claims of the 005 patent. On July 19, 2019 and July 22, 2019, respectively, Sling TV L.L.C. filed petitions with the United States Patent and Trademark Office challenging the validity of all asserted claims of the 273 patent and the 609 patent. On August 12, 2019, Sling TV L.L.C. filed a petition with the United States Patent and Trademark Office challenging the validity of all of the asserted claims of the 118 patent. On October 18, 2019, pursuant to a stipulation of the parties, the Court entered a stay of the trial proceedings.

On January 9, 2020, the United States Patent and Trademark Office agreed to institute proceedings on the petition challenging the 005 patent. On January 15, 2020, the United States Patent and Trademark Office agreed to institute proceedings on the petition challenging the 273 patent. On February 4, 2020, the United States Patent and Trademark Office agreed to institute proceedings on the petition challenging the 609 patent. On February 25, 2020, the United States Patent and Trademark Office declined to institute proceedings on the petition challenging the 118 patent.

On December 28, 2020, the United States Patent and Trademark Office issued a final written decision upholding the validity of the challenged claims of the 273 patent. Sling TV L.L.C. appealed that decision to the United States Court of Appeals for the Federal Circuit, and on February 2, 2022, the Federal Circuit vacated the final written decision and remanded to the United States Patent and Trademark Office to reconsider its ruling. On remand, on September 7, 2022, the United States Patent and Trademark Office issued a revised final written decision finding all challenged claims of the 273 patent invalid. On November 9, 2022, Uniloc filed a notice of appeal of that revised final written ~~decision.~~ decision and briefing is underway.

On January 5, 2021, the United States Patent and Trademark Office issued a final written decision invalidating all challenged claims of the 005 patent. On January 19, 2021, the United States Patent and Trademark Office issued a final written decision invalidating all challenged claims of the 609 patent (and a second final written decision invalidating all challenged claims of the 609 patent based on a ~~third party’s~~third-party’s petition).

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Vermont National Telephone Company

On September 23, 2016, the United States District Court for the District of Columbia unsealed a qui tam complaint that, on May 13, 2015, Vermont National Telephone Company (“Vermont National”) filed against DISH Network; DISH Network’s wholly-owned subsidiaries, American AWS-3 Wireless I L.L.C., American II, American III, and DISH Wireless Holding L.L.C.; Charles W. Ergen (our Chairman) and Cantey M. Ergen (a member of DISH Network’s board of directors); Northstar Wireless; Northstar Spectrum; Northstar Manager, LLC; SNR Wireless; SNR HoldCo; SNR Wireless Management, LLC; and certain other parties. The complaint alleges violations of the federal civil False Claims Act (the “FCA”) based on, among other things, allegations that Northstar Wireless and SNR Wireless falsely claimed bidding credits of 25% in the AWS-3 Auction when they were allegedly under the de facto control of DISH Network and, therefore, were not entitled to the bidding credits as designated entities under applicable FCC rules. Vermont National participated in the AWS-3 Auction through its wholly-owned subsidiary, VTel Wireless. The complaint was unsealed after the United States Department of Justice notified the District Court that it had declined to intervene in the action. Vermont National seeks to recover on behalf of the United States government approximately $10 billion, which reflects the $3.3 billion in bidding credits that Northstar Wireless and SNR Wireless claimed in the AWS-3 Auction, trebled under the FCA. Vermont National also seeks civil penalties of not less than $5,500 and not more than $11,000 for each violation of the FCA. On March 2, 2017, the United States District Court for the District of Columbia entered a stay of the litigation until such time as the United States Court of Appeals for the District of Columbia (the “D.C. Circuit”) issued its opinion in SNR Wireless LicenseCo, LLC, et al. v. F.C.C. The D.C. Circuit issued its opinion on August 29, 2017 and remanded the matter to the FCC for further proceedings. See Note 10 “Commitments – DISH Network Noncontrolling Investments in the Northstar Entities and the SNR Entities Related to AWS-3 Wireless Spectrum Licenses” in the Notes to DISH Network’s Quarterly Report on Form 10-Q for the quarter ended ~~March 31,~~June 30, 2023 for further information.

Thereafter, the District Court maintained the stay until October 26, 2018. On February 11, 2019, the District Court granted Vermont National’s unopposed motion for leave to file an amended complaint. On March 28, 2019, the defendants filed a motion to dismiss Vermont National’s amended complaint, and on March 23, 2021, the District Court granted the motion to dismiss. On April 21, 2021, Vermont National filed a notice of appeal to the United States Court of Appeals for the DC Circuit and, on May 17, 2022, that court reversed the District Court’s dismissal of the complaint. On June 16, 2022, the Defendants-Appellees filed a petition for rehearing or rehearing en banc, but on August 17, 2022, that petition was denied.

DISH Network intends to vigorously defend this case. DISH Network cannot predict with any degree of certainty the outcome of this proceeding or determine the extent of any potential liability or damages.

Other

In addition to the above actions, we are subject to various other legal proceedings and claims that arise in the ordinary course of business, including, among other things, disputes with programmers regarding fees. In our opinion, the amount of ultimate liability with respect to any of these actions is unlikely to materially affect our financial condition, results of operations or liquidity, though the outcomes could be material to our operating results for any particular period, depending, in part, upon the operating results for such period.

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10.

Financial Information for Subsidiary Guarantors

Our registered senior notes are fully and unconditionally guaranteed, jointly and severally on a senior unsecured basis by certain of our wholly-owned subsidiaries (the “Guarantors”).

Our 7 3/8% Senior Notes due 2028 and 5 1/8% Senior Notes due 2029 are guaranteed by our current principal operating subsidiaries. Our 5 7/8% Senior Notes due 2024 and 7 3/4% Senior Notes due 2026 are guaranteed by our current principal operating subsidiaries other than Sling TV Holding L.L.C. (“Sling TV Holding”). However, Sling TV Holding, including all of its assets and operations, is a wholly-owned subsidiary of DISH Network L.L.C., which is a Guarantor on all of our outstanding registered senior notes. Certain of our wholly-owned subsidiaries are designated as “Unrestricted Subsidiaries” and do not guarantee any of our registered senior notes. These Unrestricted Subsidiaries are non-operating entities that hold minimal or no assets.

We and our subsidiaries participate with our parent company, DISH Network, in a centralized system for the management of our cash and marketable investment securities. Please see Note 3 for further information.

The assets, liabilities and results of operations of the combined issuer and Guarantors (excluding Unrestricted Subsidiaries) of the guaranteed securities are not materially different than corresponding amounts presented in the condensed consolidated financial statements of the parent company issuer. Therefore, summarized financial information of the issuer and the Guarantors are not required.

The below descriptions apply to all of our existing registered senior notes. There are no material differences between our registered senior notes guaranteed by all of our current principal operating subsidiaries and our registered senior notes guaranteed by our current principal operating subsidiaries other than Sling TV Holding, a wholly-owned subsidiary of DISH Network L.L.C., which is a Guarantor on all of our outstanding registered senior notes.

The guarantee of a Guarantor will be deemed automatically discharged and released in accordance with the terms of the applicable indenture: (i) in connection with any direct or indirect sale, conveyance or other disposition of all of the capital stock or all or substantially all of the assets of that Guarantor (including by way of merger or consolidation), if such sale or disposition is made in compliance with the applicable provisions of the indenture; (ii) if such Guarantor is dissolved or liquidated in accordance with the provisions of the indenture; (iii) if we designate any such Guarantor as an “Unrestricted Subsidiary” in compliance with the terms of the indenture; or (iv) with respect to a Guarantor which constitutes a Non-Core Asset (as such term is defined in the applicable indenture), upon the sale or other disposition of certain equity interests of such Guarantor, if such sale or disposition is made in compliance with the applicable provisions of the indenture. There are no restrictions on our ability to obtain cash dividends or other distributions of funds from the Guarantors, except those imposed by applicable law.

The rights of holders of the registered senior notes against the Guarantors may be limited under the U.S. Bankruptcy Code or state fraudulent transfer or conveyance law. Under certain circumstances (including a finding that a Guarantor was insolvent at the time its guarantee of the registered senior notes was issued), a court could hold that the obligations of a Guarantor under a guarantee may be voided or are subordinate to other obligations of the Guarantor. Each guarantee contains a provision intended to limit the Guarantor’s liability to the maximum amount that it could incur without causing the incurrence of obligations under its guarantee to be a fraudulent conveyance or transfer under U.S. federal or state law.

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DISH DBS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

(Unaudited)

11.

Disaggregation of Revenue

Geographic Information. Revenue is attributed to geographic regions based upon the location where the goods and services are provided. All service revenue was derived from the United States. Substantially all of our long-lived assets reside in the United States.

The following table summarizes revenue by geographic region:


	For the Three Months Ended				For the Three Months Ended				For the Six Months Ended
	March 31,				June 30,				June 30,
Revenue:	2023		2022		2023		2022		2023		2022

	(In thousands)				(In thousands)
United States	$	2,936,113	$	3,124,967	$	2,940,556	$	3,109,961	$	5,876,669	$	6,234,928
Canada and Mexico		10,298		8,444		10,603		11,053		20,901		19,497
Total revenue	$	2,946,411	$	3,133,411	$	2,951,159	$	3,121,014	$	5,897,570	$	6,254,425

The revenue from external customers disaggregated by major revenue source was as follows:


	For the Three Months Ended				For the Three Months Ended				For the Six Months Ended
	March 31,				June 30,				June 30,
Category:	2023		2022		2023		2022		2023		2022

	(In thousands)				(In thousands)
Pay-TV subscriber and related revenue	$	2,924,045	$	3,108,313	$	2,852,460	$	3,093,765	$	5,776,505	$	6,202,078
Equipment sales and other revenue		22,366		25,098		98,699		27,249		121,065		52,347
Total	$	2,946,411	$	3,133,411	$	2,951,159	$	3,121,014	$	5,897,570	$	6,254,425

12.

Contract Balances

Our valuation and qualifying accounts as of ~~March 31,~~June 30, 2023 were as follows:


Allowance for credit losses	Balance at Beginning of Period		Current Period Provision for Expected Credit Losses		Write-offs Charged Against Allowance		Balance at End of Period		Balance at Beginning of Period		Current Period Provision for Expected Credit Losses		Write-offs Charged Against Allowance		Balance at End of Period

	(In thousands)								(In thousands)
For the three months ended March 31, 2023	$	40,642	$	12,026	$	(12,231)	$	40,437
For the six months ended June 30, 2023									$	40,642	$	33,060	$	(34,801)	$	38,901

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DISH DBS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

(Unaudited)

Contract liabilities arise when we bill our customers and receive consideration in advance of providing the service. Contract liabilities are recognized as revenue when the service has been provided to the customer. Contract liabilities are recorded in “Deferred revenue and other” and “Long-term deferred revenue and other long-term liabilities” on our Condensed Consolidated Balance Sheets.

As of

March 31,

December 31,

June 30,

December 31,

2023

2022

2023

2022

(In thousands)

Contract liabilities

495,431

506,815

462,058

506,815

Our beginning of period contract liability recorded as customer contract revenue during 2023 was ~~$498~~$500 million.

We apply a practical expedient and do not disclose the value of the remaining performance obligations for contracts that are less than one year in duration, which represent a substantial majority of our revenue. As such, the amount of revenue related to unsatisfied performance obligations is not necessarily indicative of our future revenue.

13.

Related Party Transactions

Related Party Transactions with EchoStar

Following the Spin-off, DISH Network and EchoStar have operated as separate publicly-traded companies and neither entity has any ownership interest in the other. However, a substantial majority of the voting power of the shares of both companies is owned beneficially by Charles W. Ergen, our Chairman, and by certain entities established by Mr. Ergen for the benefit of his family.

In connection with and following the Spin-off, we and EchoStar have entered into certain agreements pursuant to which we obtain certain products, services and rights from EchoStar, EchoStar obtains certain products, services and rights from us, and we and EchoStar have indemnified each other against certain liabilities arising from our respective businesses. As of ~~March 31,~~June 30, 2023 and December 31, 2022 and during the three and six months ended ~~March 31,~~June 30, 2023 and 2022, none of these agreements with EchoStar had a material impact on our financial condition or our results of operations.

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DISH DBS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

(Unaudited)

Related Party Transactions with DISH Network

“Notes Receivable - DISH Network”

Concurrently with the issuance of the 5 1/4% Senior Secured Notes due 2026 and the 5 3/4% Senior Secured Notes due 2028 (our “Senior Secured Notes”) and using the proceeds thereof, we made the Intercompany Loan to DISH Network to be used by DISH Network to finance the purchase of certain wireless spectrum licenses and for general corporate purposes, including the buildout of wireless infrastructure. The Intercompany Loan is secured by: (i) the cash proceeds of the loan; and (ii) an interest in the wireless spectrum licenses acquired using such proceeds. Such collateral may be replaced by other then-existing wireless spectrum licenses held directly or indirectly by DISH Network of equivalent value (based upon a third-party valuation). The Intercompany Loan will mature in two tranches, with the first tranche maturing on December 1, 2026 (the “2026 Tranche”) and the second tranche maturing on December 1, 2028 (the “2028 Tranche”). The aggregate principal amount of the Intercompany Loan was initially $5.250 billion, and on February 11, 2022, we advanced an additional $1.5 billion to DISH Network under the 2026 Tranche. Interest ~~will accrue~~accrues and beis payable semiannually, and interest payments with respect to the Intercompany Loan ~~will,~~are, at DISH Network’s option, be payable in kind for the first two years. In the third year, beginning November 2023, a minimum of 50% of each interest payment due with respect to each tranche of the Intercompany Loan must be paid in cash. Thereafter, beginning in November 2024, interest payments must be paid in cash. Interest ~~will accrue:~~accrues: (a) when paid in cash, at a fixed rate of 0.25% per annum in excess of the interest rate applicable to, in the case of the 2026 Tranche, the 5 1/4% Senior Secured Notes due 2026, and in the case of the 2028 Tranche, the 5 3/4% Senior Secured Notes due 2028 (each, the “Cash Accrual Rate” with respect to the applicable tranche); and (b) when paid in kind, at a rate of 0.75% per annum in excess of the Cash Accrual Rate for the applicable tranche. The Intercompany Loan ~~will be~~is repayable by DISH Network in whole or in part, at any time or from time to time, at a price equal to 100% of the principal amount thereof, plus accrued but unpaid interest thereon. We may use the proceeds of any such pre-payment for general corporate purposes, including refinancing of indebtedness, but may not use any such prepaid amounts to make a cash dividend or distribution to DISH Network prior to the repayment in full of the Intercompany Loan. The 5 1/4% Senior Secured Notes due 2026 and the 5 3/4% Senior Secured Notes due 2028 are subordinated to our existing and certain future unsecured notes with respect to certain realizations under the Intercompany Loan and any collateral pledged as security therefor. Any material amendments or modifications to the terms of the Intercompany Loan will require the written consent of the holders of a majority of the then-outstanding 5 1/4% Senior Secured Notes due 2026 and the 5 3/4% Senior Secured Notes due 2028. During the three months ended ~~March 31,~~June 30, 2023 and 2022, we recorded $~~111~~110 million and ~~$94~~$105 million of “Interest income,” respectively, on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). During the six months ended June 30, 2023 and 2022, we recorded $221 million and $199 million of “Interest income,” respectively, on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). As of ~~March 31,~~June 30, 2023 and December 31, 2022, ~~“Notes~~“Notes receivable – DISH Network” ~~was~~ ~~$7.160 billion including interest paid in kind and “Interest receivable – DISH Network” was $148 million and $37 million, respectively,~~ on our Condensed Consolidated Balance ~~Sheets.~~Sheets was $7.382 billion and $7.160 billion, respectively, including interest paid in kind. In addition, as of June 30, 2023 and December 31, 2022, “Interestreceivable – DISH Network” on our Condensed Consolidated Balance Sheets was $36 million ($17 million which must be paid in cash and $19 million which may be paid in kind), and $37 million (which was paid in kind), respectively.

“Accrued Taxes - DISH Network”

As of ~~March 31,~~June 30, 2023, we accrued $~~207~~130 million related to taxes payable to DISH Network in “Other accrued expenses” on our Condensed Consolidated Balance Sheets.

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DISH DBS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

(Unaudited)

“Cost of services”

During the three months ended ~~March 31,~~June 30, 2023 and 2022, we incurred expenses of ~~$50~~$52 million and ~~$48~~$49 million, respectively, for satellite capacity leased from DISH Network, and telemetry, tracking and control (“TT&C”) and other professional services provided to us by DISH Network. During the six months ended June 30, 2023 and 2022, we incurred expenses of $102 million and $97 million, respectively, for satellite capacity leased from DISH Network, and TT&C and other professional services provided to us by DISH Network. As a result of the Master Transaction Agreement, DISH Network is now a supplier of the vast majority of our transponder capacity. These amounts are recorded in “Cost of services” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). The agreements pertaining to these expenses are discussed below.

Satellite Capacity Leased from DISH Network. On September 10, 2019, in connection with the Master Transaction Agreement, DISH Network entered into with EchoStar on May 19, 2019, we began leasing satellite capacity on satellites owned or leased by DISH Network from a wholly-owned subsidiary of DISH Network. See “Pay-TV Satellites” in Note 6 for further information. The term of each lease is set forth below:

●

EchoStar X, XI and XIV. On March 1, 2014, we began leasing all available capacity from EchoStar on the EchoStar X, XI and XIV satellites. The term of each satellite capacity agreement generally terminates upon the earlier of: (i) the end-of-life of the satellite; (ii) the date the satellite fails; or (iii) a certain date, which depends upon, among other things, the estimated useful life of the satellite. We generally have the option to renew each satellite capacity agreement on a year-to-year basis through the end of the respective satellite’s life. There can be no assurance that any options to renew such agreements will be exercised. Pursuant to the Master Transaction Agreement, on September 10, 2019, the satellite capacity agreement we previously had with EchoStar for EchoStar X, XI and XIV was transferred to DISH Network and we began leasing satellite capacity on these satellites from a wholly-owned subsidiary of DISH Network as of the same date.

●

EchoStar XVI. In December 2009, we entered into a transponder service agreement with EchoStar to lease all of the capacity on EchoStar XVI, a DBS satellite, after its service commencement date. EchoStar XVI was launched in November 2012. Effective December 21, 2012, we and EchoStar amended the transponder service agreement to, among other things, change the initial term to generally expire upon the earlier of: (i) the end-of-life or replacement of the satellite; (ii) the date the satellite fails; (iii) the date the transponder(s) on which service is being provided under the agreement fails; or (iv) four years following the actual service commencement date. In July 2016, we and EchoStar amended the transponder service agreement to, among other things, extend the initial term by one additional year and to reduce the term of the first renewal option by one year. Prior to expiration of the initial term, we had the option to renew for an additional five-year period. In May 2017, we exercised our first renewal option for an additional five-year period ending in January 2023. We ~~also~~have renewed and have the option to renew ~~for an additional~~ ~~five-year~~ ~~period prior to expiration~~this agreement on a year-to-year basis through the end of the ~~first renewal period in January 2023.~~satellite’s life. There can be no assurance that the option to renew this agreement will be exercised. During 2018, we and EchoStar further amended the agreement to, among other things, allow us to place and use certain satellites at the 61.5 degree orbital location. Pursuant to the Master Transaction Agreement, on September 10, 2019, the transponder service agreement we previously had with EchoStar for EchoStar XVI was transferred to DISH Network and we began receiving transponder services from a wholly-owned subsidiary of DISH Network as of the same date.

EchoStar XXIII. On March 1, 2023, we began leasing certain capacity on the EchoStar XXIII satellite from DISH Network on a month to month basis.

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DISH DBS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

(Unaudited)

Nimiq 5 Agreement. During 2009, EchoStar entered into a 15-year satellite service agreement with Telesat Canada (“Telesat”) to receive service on all 32 DBS transponders on the Nimiq 5 satellite at the 72.7 degree orbital location (the “Telesat Transponder Agreement”). During 2009, EchoStar also entered into a satellite service agreement (the “DISH Nimiq 5 Agreement”) with us, pursuant to which we received service from EchoStar on all 32 of the DBS transponders covered by the Telesat Transponder Agreement.

Under the terms of the DISH Nimiq 5 Agreement, we made certain monthly payments to EchoStar that commenced in 2009 when the Nimiq 5 satellite was placed into service and continued through the service term, which expired ten years following the date the Nimiq 5 satellite was placed into service. Upon expiration of the initial term, we had the option to renew on a year-to-year basis through the end-of-life of the Nimiq 5 satellite. Pursuant to the Master Transaction Agreement, on September 10, 2019, the Telesat Transponder Agreement was transferred to DISH Network and we began receiving transponder services on the Nimiq 5 satellite from a wholly-owned subsidiary of DISH Network as of the same date. We have exercised our option to renew for a one-year period through September 2023. As discussed in Note 6, “Property and Equipment, ~~and Intangible Assets,~~” the Nimiq 5 satellite lease has been accounted for as a finance lease since September 2019. Expenses related to this lease are recorded in “Depreciation and amortization” and “Interest expense, net of amounts capitalized” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). During each of the three months ended ~~March 31,~~June 30, 2023 and 2022, we recorded $98 million of “Depreciation and ~~amortization expense”~~amortization” expense and $2$1 million and $2$3 million of “Interest expense, net of amounts capitalized,” respectively, related to Nimiq 5. During each of the six months ended June 30, 2023 and 2022, we recorded $17 million of “Depreciation and amortization” expense and $3 million and $5 million of “Interest expense, net of amounts capitalized,” respectively, related to Nimiq 5.

TT&C Agreement. Effective January 1, 2012, we entered into a TT&C agreement pursuant to which we ~~receive~~received TT&C services from EchoStar for certain satellites (the “TT&C Agreement”). In February 2018, we amended the TT&C Agreement to, among other things, extend the term for one-year with four automatic one-year renewal periods. The fees for services provided under the TT&C Agreement ~~are~~were calculated at either: (i) a fixed fee; or (ii) cost plus a fixed margin, which will vary depending on the nature of the services provided. We and EchoStar were able to terminate the TT&C Agreement for any reason upon 12 months’ notice. On May 19, 2019, DISH Network entered into a Master Transaction Agreement pursuant to which, on September 10, 2019, the assets and employees that provide these services were transferred to DISH Network. We began receiving TT&C services from a wholly-owned subsidiary of DISH Network as of the same date.

“Selling, general and administrative expenses”

During the three months ended ~~March 31,~~June 30, 2023 and 2022, we incurred $3$1 million and $3 million, respectively, for selling, general and administrative expenses for services provided to us by DISH Network. During the six months ended June 30, 2023 and 2022, we incurred $4 million and $5 million, respectively, for selling, general and administrative expenses for services provided to us by DISH Network. These amounts are recorded in “Selling, general and administrative expenses” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). The agreements pertaining to these expenses are discussed below.

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DISH DBS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

(Unaudited)

Real Estate Lease Agreements. On September 10, 2019, in connection with the Master Transaction Agreement, we began leasing office space owned or leased by DISH Network from a wholly-owned subsidiary of DISH Network. The term of the remaining lease is set forth below:

●

Cheyenne Lease Agreement. The lease for certain space at 530 EchoStar Drive in Cheyenne, Wyoming is for a period ending on December 31, 2031. In connection with the completion of the Share Exchange, EchoStar transferred ownership of a portion of this property to DISH Network, and, effective March 1, 2017, DISH Network and EchoStar amended this lease agreement to: (i) terminate the lease of certain space at the portion of the property that was transferred to DISH Network; and (ii) provide for the continued lease to us of certain space at the portion of the property that EchoStar retained. Pursuant to the Master Transaction Agreement, the portion of the property EchoStar retained was transferred to DISH Network, and on September 10, 2019, this lease was transferred to DISH Network and we began leasing certain space from a wholly-owned subsidiary of DISH Network as of the same date.

Other Agreements – DISH Network

Broadband, Wireless and Other Operations. We provide certain administrative, call center, installation, marketing and other services to DISH Network’s broadband, wireless and other operations. During the three months ended ~~March 31,~~June 30, 2023 and 2022, the costs associated with these services were $3531 million and ~~$29~~$27 million, respectively. During the six months ended June 30, 2023 and 2022, the costs associated with these services were $66 million and $56 million, respectively.

Related Party Transactions with NagraStar L.L.C.

We own a 50% interest in NagraStar, a joint venture that is our primary provider of encryption and related security systems intended to assure that only authorized customers have access to our programming. Certain payments related to NagraStar are recorded in “Cost of services” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). In addition, certain other payments are initially included in “Inventory” and are subsequently capitalized as “Property and equipment, net” on our Condensed Consolidated Balance Sheets or expensed as “Selling, general and administrative expenses” or “Cost of services” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) when the equipment is deployed. We record all payables in “Trade accounts payable” or “Other accrued expenses” on our Condensed Consolidated Balance Sheets. Our investment in NagraStar is accounted for using the equity method.

~~The table below summarizes our transactions with NagraStar:~~

For the Three Months Ended

March 31,


2023

2022


(In thousands)
Purchases (including fees):

Purchases from NagraStar

$
9,545

$
11,957

As of

March 31,

December 31,

2023

2022

(In thousands)

Amounts Payable and Commitments:

Amounts payable to NagraStar

$
6,773

$
7,422

Commitments to NagraStar

$
4,000

$
3,272

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DISH DBS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - Continued

(Unaudited)

The table below summarizes our transactions with NagraStar:


	For the Three Months Ended				For the Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022

	(In thousands)
Purchases (including fees):
Purchases from NagraStar	$	9,495	$	10,471	$	19,040	$	22,428

	As of
	June 30,		December 31,
	2023		2022

	(In thousands)
Amounts Payable and Commitments:
Amounts payable to NagraStar	$	7,735	$	7,422
Commitments to NagraStar	$	2,811	$	3,272

14. Subsequent Events

On August 8, 2023, DISH Network entered into an Agreement and Plan of Merger (the “Merger Agreement”) with EchoStar Corporation, a Nevada corporation (“EchoStar”), and Eagle Sub Corp, a Nevada corporation and a wholly owned subsidiary of DISH Network (“Merger Sub”). DISH Network’s Board of Directors (the “Board”), acting upon the unanimous recommendation of a special transaction committee of independent directors of the Board, has unanimously approved and declared advisable the Merger Agreement and the transactions contemplated by the Merger Agreement.

The Merger Agreement provides, among other things, that subject to the satisfaction or waiver of the conditions set forth therein, DISH Network will acquire EchoStar by means of a merger of Merger Sub with and into EchoStar (the “Merger”), with EchoStar surviving the Merger as DISH Network’s wholly owned subsidiary. For more information and a copy of the Merger Agreement see Form 8-K of DISH Network Corporation filed August 8, 2023.

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Item 2.MANAGEMENT’S NARRATIVE ANALYSIS OF RESULTS OF OPERATIONS

You should read the following management’s narrative analysis of our financial condition and results of operations together with the condensed consolidated financial statements and notes to our financial statements included elsewhere in this Quarterly Report on Form 10-Q. This management’s narrative analysis is intended to help provide an understanding of our financial condition, changes in financial condition and results of our operations and contains forward-looking statements that involve risks and uncertainties. The forward-looking statements are not historical facts, but rather are based on current expectations, estimates, assumptions and projections about our industry, business and future financial results. Our actual results could differ materially from the results contemplated by these forward-looking statements due to a number of factors, including those discussed in our Annual Report on Form 10-K for the year ended December 31, 2022 under the caption “Item 1A. Risk Factors.” Furthermore, such forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q, and we expressly disclaim any obligation to update any forward-looking statements.

Overview

We currently operate one business segment, Pay-TV.

Our Pay-TV business strategy is to be the best provider of video services in the United States by providing products with the best technology, outstanding customer service, and great value. We offer pay-TV services under the DISH® brand and the SLING® brand (collectively “Pay-TV” services). The DISH branded pay-TV service consists of, among other things, FCC licenses authorizing us to use direct broadcast satellite (“DBS”) and Fixed Satellite Service (“FSS”) spectrum, our owned and leased satellites, receiver systems, broadcast operations, a leased fiber optic network, in-home service and call center operations, and certain other assets utilized in our operations (“DISH TV”). We also design, develop and distribute receiver systems and provide digital broadcast operations, including satellite uplinking/ downlinking, transmission and other services to third-party pay-TV providers. The SLING branded pay-TV services consist of, among other things, multichannel, live-linear and on-demand streaming over-the-top (“OTT”) Internet-based domestic, international and Latino video programming services (“SLING TV”). We promote our Pay-TV services by providing our subscribers with a better “price-to-value” relationship and experience than those available from other subscription television service providers. We market our SLING TV services to consumers who do not subscribe to traditional satellite and cable pay-TV services, as well as to current and recent traditional pay-TV subscribers who desire a lower cost alternative.

~~Recent~~Other Developments

Cyber-Security Incident

Our DISH TV and SLING TV services remained operational at all times during the incident. As of March 31, 2023, all significant systems ~~have~~had been restored.

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Economic Environment

During 2022 and the first ~~three~~six months of 2023, we experienced significant inflationary pressures in our commodity and labor costs resulting from the macroeconomic environment in the United States, which has significantly impacted our overall operating results.

COVID-19 Update

The COVID-19 pandemic created unanticipated circumstances and uncertainty, disruption, and significant volatility in the economic environment generally, which have adversely affected, and may continue to adversely affect, our business operations, including, but not limited to, our supply chain, and could materially and adversely affect our business, financial condition and results of operations. In addition, any resurgence in COVID-19 could adversely affect our business, financial condition and results of operations.

Pay-TV

We offer Pay-TV services under the DISH^® brand and the SLING^® brand. As of ~~March 31,~~June 30, 2023, we had ~~9.198~~8.904 million Pay-TV subscribers in the United States, including ~~7.098~~6.901 million DISH TV subscribers and ~~2.100~~2.003 million SLING TV subscribers. We promote our Pay-TV services by providing our subscribers with better service, technology and value than those available from other subscription television service providers. We offer a wide selection of video services under the DISH TV brand, with access to hundreds of channels depending on the level of subscription. Our standard programming packages generally include programming provided by national cable networks. We also offer programming packages that include local broadcast networks, specialty sports channels, premium movie channels and Latino and international programming. We market our SLING TV services to consumers who do not subscribe to traditional satellite and cable pay-TV services, as well as to current and recent traditional pay-TV subscribers who desire a lower cost alternative. Our SLING TV services require an Internet connection and are available on multiple streaming-capable devices including, among others, streaming media devices, TVs, tablets, computers, game consoles and phones. We offer SLING domestic, SLING International, and SLING Latino video programming services.

Trends

Competition

Competition has intensified in recent years as the pay-TV industry has matured. We and our competitors increasingly must seek to attract a greater proportion of new subscribers from each other’s existing subscriber bases rather than from first-time purchasers of pay-TV services. We face substantial competition from established pay-TV providers and broadband service providers and increasing competition from companies providing/facilitating the delivery of video content via the Internet to computers, televisions, and other streaming and mobile devices, including wireless service providers. In recent years, industry consolidation and convergence has created competitors with greater scale and multiple product/service offerings. These developments, among others, have contributed to intense and increasing competition, and we expect such competition to continue. We incur significant costs to retain our existing DISH TV subscribers, generally as a result of upgrading their equipment to next generation receivers, primarily including our Hopper® receivers, and by providing retention credits. Our DISH TV subscriber retention costs may vary significantly from period to period.

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Many of our competitors have been especially aggressive by offering discounted programming and services for both new and existing subscribers, including, but not limited to, bundled offers combining broadband, video and/or wireless services and other promotional offers. Certain competitors have been able to subsidize the price of video services with the price of broadband and/or wireless services.

Our Pay-TV services also face increased competition from programmers and other companies who distribute video directly to consumers over the Internet, as well as traditional satellite television providers, cable companies and large telecommunications companies that are increasing their Internet-based video offerings. We also face competition from providers of video content, many of which are providers of our programming content, that distribute content over the Internet including services with live-linear television programming, as well as single programmer offerings and offerings of large libraries of on-demand content, including in certain cases original content. These product offerings include, but are not limited to, Netflix, Hulu, Apple+, Prime Video, YouTube TV, Disney+, ESPN+, Paramount+, HBO Max, STARZ, Peacock, Fubo, Philo and Tubi.

Significant changes in consumer behavior regarding the means by which consumers obtain video entertainment and information in response to digital media competition could have a material adverse effect on our business, results of operations and financial condition or otherwise disrupt our business. In particular, consumers have shown increased interest in viewing certain video programming in any place, at any time and/or on any broadband or Internet-connected device they choose. Online content providers may cause our subscribers to disconnect our DISH TV services (“cord cutting”), downgrade to smaller, less expensive programming packages (“cord shaving”) or elect to purchase through these online content providers a certain portion of the services that they would have historically purchased from us.

Mergers and acquisitions, joint ventures and alliances among cable television providers, telecommunications companies, programming providers and others may result in, among other things, greater scale and financial leverage and increase the availability of offerings from providers capable of bundling video, broadband and/or wireless services in competition with our services and may exacerbate the risks described under the caption “Item 1A. Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2022 and elsewhere in our public filings. These transactions may affect us adversely by, among other things, making it more difficult for us to obtain access to certain programming networks on nondiscriminatory and fair terms, or at all.

Our Pay-TV subscriber base has been declining due to, among other things, the factors described above. There can be no assurance that our Pay-TV subscriber base will not continue to decline and that the pace of such decline will not accelerate. As our Pay-TV subscriber base continues to decline, it could have a material adverse long-term effect on our business, results of operations, financial condition and cash flow.

Programming

Our ability to compete successfully will depend, among other things, on our ability to continue to obtain desirable programming and deliver it to our subscribers at competitive prices. Programming costs represent a large percentage of our “Cost of services” and the largest component of our total expense. We expect these costs to continue to increase due to contractual price increases and the renewal of long-term programming contracts on less favorable pricing terms and certain programming costs are rising at a much faster rate than wages or inflation. In particular, the rates we are charged for retransmitting local broadcast channels have been increasing substantially and may exceed our ability to increase our prices to our subscribers. Going forward, our margins may face pressure if we are unable to renew our long-term programming contracts on acceptable pricing and other economic terms or if we are unable to pass these increased programming costs on to our subscribers.

Increases in programming costs have caused us to increase the rates that we charge to our subscribers, which could in turn cause our existing Pay-TV subscribers to disconnect our services or cause potential new Pay-TV subscribers to choose not to subscribe to our services. Additionally, even if our subscribers do not disconnect our services, they may purchase through new and existing online content providers a certain portion of the services that they would have historically purchased from us.

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Furthermore, our net Pay-TV subscriber additions, gross new DISH TV subscriber activations, and DISH TV churn rate may be negatively impacted if we are unable to renew our long-term programming carriage contracts. In the past, our net Pay-TV subscriber additions, gross new DISH TV subscriber activations, and DISH TV churn rate have been negatively impacted as a result of programming interruptions and threatened programming interruptions in connection with the scheduled expiration of programming carriage contracts with content providers. There can be no assurance that the removal of ~~these or other~~any channels will not have a material adverse effect on our business, results of operations and financial condition or otherwise disrupt our business.

We cannot predict with any certainty the impact to our net Pay-TV subscriber additions, gross new DISH TV subscriber activations, and DISH TV churn rate resulting from ~~additional~~ programming interruptions or threatened programming interruptions that may occur in the future. As a result, we may at times suffer from periods of lower net Pay-TV subscriber additions or higher net Pay-TV subscriber losses.

Other Developments

Adaptive Bitrate Streaming Patents

Through our subsidiaries, we hold dozens of issued United States and foreign patents that relate to Adaptive Bitrate Streaming. On September 9, 2022, the chief administrative law judge at the United States International Trade Commission (“ITC”) issued an Initial Determination holding that the video streaming in certain Peloton, NordicTrack and Mirror exercise equipment infringes four of those patents, and recommended that the ITC prevent the importation of the infringing products. On March 8, 2023, the ITC issued its Final Determination, which affirmed the Initial Determination for three of the four patents in all material aspects, and issued the recommended exclusion and cease and desist orders, which will become effective after a Presidential review period. On February 9, 2023, we entered into a confidential license agreement covering Mirror exercise equipment that resolves our litigation involving those products. On May 1, 2023, we entered into a $75 million license agreement covering Peloton exercise equipment that resolves our litigation involving those products. During the three and six months ended June 30, 2023, we recorded the $75 million license agreement in “Equipment sales and other revenue” on our Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). We have not reached a settlement with respect to the NordicTrack infringing products and we intend to enforce this litigation and to pursue our related patent infringement claims against them.

Operational Liquidity

We make general investments in property such as, among others, satellites, set-top boxes, information technology and facilities that support our Pay-TV business. Moreover, since we are a subscriber-based company, we also make subscriber-specific investments to acquire new subscribers and retain existing subscribers. While the general investments may be deferred without impacting the business in the short-term, the subscriber-specific investments are less discretionary. Our overall objective is to generate sufficient cash flow over the life of each subscriber to provide an adequate return against the upfront investment. Once the upfront investment has been made for each subscriber, the subsequent cash flow is generally positive, but there can be no assurance that over time we will recoup or earn a return on the upfront investment.

There are a number of factors that impact our future cash flow compared to the cash flow we generate at a given point in time. The first factor is our churn rate and how successful we are at retaining our current subscribers. To the extent we lose subscribers from our existing base, the positive cash flow from that base is correspondingly reduced. The second factor is how successful we are at maintaining our service margins. To the extent our “Cost of services” grow faster than our “Service revenue,” the amount of cash flow that is generated per existing subscriber is reduced. Our Pay-TV service margins have been reduced by, among other things, higher programming costs. The third factor is the rate at which we acquire new subscribers. The faster we acquire new subscribers, the more our positive ongoing cash flow from existing subscribers is offset by the negative upfront cash flow associated with acquiring new subscribers. Conversely, the slower we acquire subscribers, the more our operating cash flow is enhanced in that period.

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Finally, our future cash flow is impacted by, among other things, the rate at which we make general investments, incur litigation expense, and any cash flow from financing activities. In addition, declines in our Pay-TV subscriber base and any decrease in subscriber-related margins negatively impact our cash flow, and there can be no assurance that our subscriber declines will not continue.

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Availability of Credit and Effect on Liquidity

The ability to raise capital has generally existed for us despite economic weakness and uncertainty. While modest fluctuations in the cost of capital will not likely impact our current operational plans, significant fluctuations could have a material adverse effect on our business, results of operations and financial condition.

Debt Issuances and Maturity

Our 5% Senior Notes due 2023 with an aggregate principal balance of $1.5 billion were repurchased or redeemed as of March 15, 2023.

Future Liquidity

We have made cash distributions and the Intercompany Loan to partially finance the development of DISH Network’s 5G Network Deployment, including, but not limited to, the purchase of wireless spectrum licenses and the retail wireless business to date, and we may make additional funds available to DISH Network in the form of cash distributions or loans to finance, in whole or in part, DISH Network’s future efforts. These factors, including, but not limited to, debt maturities, continuing investment in our business, financing acquisitions and other strategic transactions, may require us to raise additional capital in the future which may not be available on acceptable terms, or at all.

Covenants and Restrictions Related to our Long-Term Debt

We are subject to the covenants and restrictions set forth in the indentures related to our long-term debt. In particular, the indentures related to our outstanding senior notes and senior secured notes contain restrictive covenants that, among other things, impose limitations on our ability to: (i) incur additional indebtedness; (ii) enter into sale and leaseback transactions; (iii) pay dividends or make distributions on our capital stock or repurchase our capital stock; (iv) make certain investments; (v) create liens; (vi) enter into certain transactions with affiliates; (vii) merge or consolidate with another company; and (viii) transfer or sell assets. Should we fail to comply with these covenants, all or a portion of the debt under the senior notes, senior secured notes and our other long-term debt could become immediately payable. The senior notes and senior secured notes also provide that the debt may be required to be prepaid if certain change-in-control events occur. As of the date of filing of this Quarterly Report on Form 10-Q, we were in compliance with the covenants and restrictions related to our respective long-term debt.

Notes Receivable - DISH Network

Concurrently with the issuance of the 5 1/4% Senior Secured Notes due 2026 and the 5 3/4% Senior Secured Notes due 2028 and using the proceeds thereof, we made the Intercompany Loan to DISH Network to be used by DISH Network to finance the purchase of certain wireless spectrum licenses and for general corporate purposes, including the buildout of wireless infrastructure. The aggregate principal amount of the Intercompany Loan was initially $5.250 billion, and on February 11, 2022, we advanced an additional $1.5 billion to DISH Network. As of ~~March 31,~~June 30, 2023, the total Intercompany Loan amount outstanding plus interest paid in kind was ~~$7.160~~$7.382 billion, not including accrued interest receivable of ~~$148 million.~~$36 million, of which $17 million must be paid in cash.

New Accounting Pronouncements

See Note 2 in the Notes to our Condensed Consolidated Financial Statements for further information.

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EXPLANATION OF KEY METRICS AND OTHER ITEMS

Service revenue. “Service revenue” consists principally of Pay-TV subscriber revenue. Certain of the amounts included in “Service revenue” are not recurring on a monthly basis.

Equipment sales and other revenue. “Equipment sales and other revenue” principally includes the non-subsidized sales of Pay-TV ~~equipment.~~equipment and the licensing of certain intellectual property.

Cost of services. “Cost of services” principally includes Pay-TV programming expenses and other operating costs related to our Pay-TV services.

Cost of sales - equipment and other. “Cost of sales – equipment and other” principally includes the cost of the non-subsidized sales of Pay-TV equipment. Costs are generally recognized as products are delivered to customers and the related revenue is recognized.

Selling, general and administrative expenses. “Selling, general and administrative expenses” consists primarily of direct sales costs, advertising, third-party commissions related to the acquisition of subscribers and employee-related costs associated with administrative services such as legal, information systems, and accounting and finance. In addition, “Selling, general and administrative expenses” includes costs related to the installation of equipment for our new Pay-TV subscribers and the cost of subsidized sales of Pay-TV equipment for new subscribers.

Interest expense, net of amounts capitalized. “Interest expense, net of amounts capitalized” primarily includes interest expense associated with our long-term debt (net of capitalized interest), prepayment premiums, amortization of debt discounts and debt issuance costs associated with our long-term debt, and interest expense associated with our finance lease obligations.

Other, net. The main components of “Other, net” are gains and losses realized on the sale of investments, impairment of marketable and non-marketable investment securities, unrealized gains and losses from changes in fair value of certain marketable and non-marketable investment securities and equity in earnings and losses of our affiliates.

Earnings before interest, taxes, depreciation and amortization (“EBITDA”). EBITDA is defined as “Net income (loss)” plus “Interest expense, net of amounts capitalized” and net of “Interest income,” “Income tax (provision) benefit, net” and “Depreciation and amortization.” This “non-GAAP measure” is reconciled to “Net income (loss)” in our discussion of “Results of Operations” below.

Operating income before depreciation and amortization (“OIBDA”). OIBDA is defined as “Operating income (loss)” plus “Depreciation and amortization.” This “non-GAAP measure” is reconciled to “Operating income (loss)” in our discussion of “Results of Operations” below.

DISH TV subscribers. We include customers obtained through direct sales, independent third-party retailers and other independent third-party distribution relationships in our DISH TV subscriber count. We also provide DISH TV services to hotels, motels and other commercial accounts. For certain of these commercial accounts, we divide our total revenue for these commercial accounts by $34.99, and include the resulting number, which is substantially smaller than the actual number of commercial units served, in our DISH TV subscriber count.

SLING TV subscribers. We include customers obtained through direct sales and third-party marketing agreements in our SLING TV subscriber count. SLING TV subscriber additions are recorded net of disconnects. SLING TV customers receiving service for no charge, under certain new subscriber promotions, are excluded from our SLING TV subscriber count. For customers who subscribe to multiple SLING TV packages, each customer is only counted as one SLING TV subscriber.

Pay-TV subscribers. Our Pay-TV subscriber count includes all DISH TV and SLING TV subscribers discussed above. For customers who subscribe to both our DISH TV services and our SLING TV services, each subscription is counted as a separate Pay-TV subscriber.

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Pay-TV average monthly revenue per subscriber (“Pay-TV ARPU”). We are not aware of any uniform standards for calculating ARPU and believe presentations of ARPU may not be calculated consistently by other companies in the same or similar businesses. We calculate Pay-TV average monthly revenue per Pay-TV subscriber, or Pay-TV ARPU, by dividing average monthly Pay-TV “Service revenue,” for the period by our average number of Pay-TV subscribers for the period. The average number of Pay-TV subscribers is calculated for the period by adding the average number of Pay-TV subscribers for each month and dividing by the number of months in the period. The average number of Pay-TV subscribers for each month is calculated by adding the beginning and ending Pay-TV subscribers for the month and dividing by two. SLING TV subscribers on average purchase lower priced programming services than DISH TV subscribers, and therefore, as SLING TV subscribers increase as a percentage of total Pay-TV subscribers, it has had a negative impact on Pay-TV ARPU.

DISH TV average monthly subscriber churn rate (“DISH TV churn rate”). We are not aware of any uniform standards for calculating subscriber churn rate and believe presentations of subscriber churn rates may not be calculated consistently by different companies in the same or similar businesses. We calculate our “DISH TV churn rate” for any period by dividing the number of DISH TV subscribers who terminated service during the period by the average number of DISH TV subscribers for the same period, and further dividing by the number of months in the period. The average number of DISH TV subscribers is calculated for the period by adding the average number of DISH TV subscribers for each month and dividing by the number of months in the period. The average number of DISH TV subscribers for each month is calculated by adding the beginning and ending DISH TV subscribers for the month and dividing by two.

DISH TV SAC. Subscriber acquisition cost measures are commonly used by those evaluating traditional companies in the pay-TV industry. We are not aware of any uniform standards for calculating the “average subscriber acquisition costs per new DISH TV subscriber activation,” or DISH TV SAC, and we believe presentations of pay-TV SAC may not be calculated consistently by different companies in the same or similar businesses. Our DISH TV SAC is calculated using all costs of acquiring DISH TV subscribers (e.g., subsidized equipment, advertising, installation, commissions and direct sales, etc.), which are included in “Selling, general and administrative expenses,” plus capitalized payments made under certain sales incentive programs and the value of equipment capitalized under our lease program for new DISH TV subscribers, divided by gross new DISH TV subscriber activations. We include all new DISH TV subscribers in our calculation, including DISH TV subscribers added with little or no subscriber acquisition costs.

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RESULTS OF OPERATIONS

Three Months Ended ~~March 31,~~June 30, 2023 Compared to the Three Months Ended ~~March 31,~~June 30, 2022.


	For the Three Months Ended										For the Three Months Ended
	March 31,						Variance				June 30,						Variance
Statements of Operations Data	2023			2022			Amount			%	2023			2022			Amount			%

	(In thousands)										(In thousands)
Revenue:
Service revenue	$	2,924,045		$	3,108,313		$	(184,268)		(5.9)	$	2,852,460		$	3,093,765		$	(241,305)		(7.8)
Equipment sales and other revenue		22,366			25,098			(2,732)		(10.9)		98,699			27,249			71,450		*
Total revenue		2,946,411			3,133,411			(187,000)		(6.0)		2,951,159			3,121,014			(169,855)		(5.4)

Costs and Expenses:
Cost of services		1,856,592			1,890,096			(33,504)		(1.8)		1,782,237			1,887,814			(105,577)		(5.6)
% of Service revenue		63.5	%		60.8	%						62.5	%		61.0	%
Cost of sales - equipment and other		17,300			20,872			(3,572)		(17.1)		22,438			21,922			516		2.4
Selling, general and administrative expenses		335,720			401,751			(66,031)		(16.4)		380,182			364,147			16,035		4.4
% of Total revenue		11.4	%		12.8	%						12.9	%		11.7	%
Depreciation and amortization		83,900			95,916			(12,016)		(12.5)		81,832			89,418			(7,586)		(8.5)
Total costs and expenses		2,293,512			2,408,635			(115,123)		(4.8)		2,266,689			2,363,301			(96,612)		(4.1)

Operating income (loss)		652,899			724,776			(71,877)		(9.9)		684,470			757,713			(73,243)		(9.7)

Other Income (Expense):
Interest income		120,386			97,120			23,266		24.0		111,404			113,281			(1,877)		(1.7)
Interest expense, net of amounts capitalized		(198,800)			(232,369)			33,569		14.4		(184,511)			(230,210)			45,699		19.9
Other, net		(579)			790			(1,369)		*		(95)			455			(550)		*
Total other income (expense)		(78,993)			(134,459)			55,466		41.3		(73,202)			(116,474)			43,272		37.2

Income (loss) before income taxes		573,906			590,317			(16,411)		(2.8)		611,268			641,239			(29,971)		(4.7)
Income tax (provision) benefit, net		(140,623)			(145,906)			5,283		3.6		(153,630)			(158,059)			4,429		2.8
Effective tax rate		24.5	%		24.7	%						25.1	%		24.6	%
Net income (loss)	$	433,283		$	444,411		$	(11,128)		(2.5)	$	457,638		$	483,180		$	(25,542)		(5.3)

Other Data:
Pay-TV subscribers, as of period end (in millions)		9.198			10.245			(1.047)		(10.2)		8.904			9.988			(1.084)		(10.9)
DISH TV subscribers, as of period end (in millions)		7.098			7.993			(0.895)		(11.2)		6.901			7.791			(0.890)		(11.4)
SLING TV subscribers, as of period end (in millions)		2.100			2.252			(0.152)		(6.7)		2.003			2.197			(0.194)		(8.8)
Pay-TV subscriber additions (losses), net (in millions)		(0.552)			(0.462)			(0.090)		(19.5)		(0.294)			(0.257)			(0.037)		(14.4)
DISH TV subscriber additions (losses), net (in millions)		(0.318)			(0.228)			(0.090)		(39.5)		(0.197)			(0.202)			0.005		2.5
SLING TV subscriber additions (losses), net (in millions)		(0.234)			(0.234)			—		*		(0.097)			(0.055)			(0.042)		(76.4)
Pay-TV ARPU	$	102.71		$	99.44		$	3.27		3.3	$	104.07		$	101.30		$	2.77		2.7
DISH TV subscriber additions, gross (in millions)		0.113			0.159			(0.046)		(28.9)		0.120			0.156			(0.036)		(23.1)
DISH TV churn rate		1.98	%		1.59	%		0.39	%	24.5		1.51	%		1.51	%		—	%	*
DISH TV SAC	$	1,055		$	1,088		$	(33)		(3.0)	$	1,169		$	980		$	189		19.3
Purchases of property and equipment	$	31,386		$	30,889		$	497		1.6	$	30,028		$	29,543		$	485		1.6
EBITDA	$	736,220		$	821,482		$	(85,262)		(10.4)	$	766,207		$	847,586		$	(81,379)		(9.6)
OIBDA	$	736,799		$	820,692		$	(83,893)		(10.2)	$	766,302		$	847,131		$	(80,829)		(9.5)

* Percentage is not meaningful.

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Pay-TV Subscribers

DISH TV subscribers. We lost approximately ~~318,000~~197,000 net DISH TV subscribers during the three months ended ~~March 31,~~June 30, 2023 compared to the loss of approximately ~~228,000~~202,000 net DISH TV subscribers during the same period in 2022. This ~~increase~~decrease in net DISH TV subscriber losses primarily resulted from lower DISH TV subscriber disconnects in 2023, partially offset by lower gross new DISH TV subscriber ~~activations and a higher DISH TV churn rate.~~activations.

SLING TV subscribers. We lost approximately ~~234,000~~97,000 net SLING TV subscribers during the three months ended ~~March 31,~~June 30, 2023 compared to the loss of approximately ~~234,000~~55,000 net SLING TV subscribers during the same period in 2022. The increase in net SLING TV subscriber losses were primarily related to higher SLING TV subscriber ~~activations,~~disconnects, partially offset by higher SLING TV subscriber ~~disconnects~~activations in 2023. We continue to experience increased competition, including competition from other subscription video on-demand and live-linear OTT service providers.

DISH TV subscribers, gross. During the three months ended ~~March 31,~~June 30, 2023, we activated approximately ~~113,000~~120,000 gross new DISH TV subscribers compared to approximately ~~159,000~~156,000 gross new DISH TV subscribers during the same period in 2022, a decrease of ~~28.9%~~23.1%. This decrease in our gross new DISH TV subscriber activations was primarily related to the lack of demand and shifting consumer behavior, ~~and lower marketing expenditures,~~ as well as increased competitive pressures, including, but not limited to, live-linear OTT service providers, aggressive short term introductory pricing and bundled offers combining broadband, video and/or wireless services and other discounted promotional offers, ~~live-linear OTT service providers,~~ and direct-to-consumer offerings by certain of our programmers. Our gross new DISH TV subscriber activations continue to be negatively impacted by an emphasis on acquiring higher quality subscribers.

DISH TV churn rate. Our DISH TV churn rate for the three months ended ~~March 31,~~June 30, 2023 was ~~1.98%~~1.51% compared to ~~1.59%~~1.51% for the same period in 2022. ~~Our DISH TV~~While our churn rate ~~for the three months ended March 31,~~remained unchanged in 2023, ~~was briefly elevated due to the cyber-security incident.~~ o~~Our~~ur DISH TV churn rate continues to be adversely impacted by external factors, such as, among other things, cord cutting, shifting consumer behavior and increased competitive pressures, including, but not limited to, live-linear OTT service providers, aggressive marketing, bundled discount offers combining broadband, video and/or wireless services and other discounted promotional offers. Our DISH TV churn rate continues to be positively impacted by our emphasis on acquiring and retaining higher quality subscribers. Our DISH TV churn rate is also impacted by internal factors, such as, among other things, our ability to consistently provide outstanding customer service, price increases, our ability to control piracy and other forms of fraud, and the level of our retention efforts.

Our net Pay-TV subscriber additions, gross new DISH TV subscriber activations, and DISH TV churn rate have been negatively impacted as a result of programming interruptions and threatened programming interruptions in connection with the scheduled expiration of programming carriage contracts with content providers. We cannot predict with any certainty the impact to our net Pay-TV subscriber additions, gross new DISH TV subscriber activations, and DISH TV subscriber churn rate resulting from programming interruptions or threatened programming interruptions that may occur in the future. As a result, we may at times suffer from periods of lower net Pay-TV subscriber additions or higher net Pay-TV subscriber losses.

We have not always met our own standards for performing high-quality installations, effectively resolving subscriber issues when they arise, answering subscriber calls in an acceptable timeframe, effectively communicating with our subscriber base, reducing calls driven by the complexity of our business, improving the reliability of certain systems and subscriber equipment and aligning the interests of certain independent third-party retailers and installers to provide high-quality service. Most of these factors have affected both gross new DISH TV subscriber activations as well as DISH TV subscriber churn rate. Our future gross new DISH TV subscriber activations and our DISH TV subscriber churn rate may be negatively impacted by these factors, which could in turn adversely affect our revenue.

Service revenue. “Service revenue” totaled ~~$2.924~~$2.852 billion for the three months ended ~~March 31,~~June 30, 2023, a decrease of ~~$184~~$241 million or ~~5.9%~~7.8% compared to the same period in 2022. The decrease in “Service revenue” compared to the same period in 2022 was primarily related to lower average Pay-TV subscriber base, partially offset by an increase in Pay-TV ARPU, discussed below.

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Equipment sales and other revenue. “Equipment sales and other revenue” totaled $99 million for the three months ended June 30, 2023, an increase of $71 million compared to the same period in 2022. The increase in “Equipment sales and other revenue” compared to the same period in 2022 was primarily related to a non-recurring $75 million license of our Adaptive Bitrate Streaming patents to Peloton covering certain Peloton products that resolves our litigation involving those products.

Pay-TV ARPU. Pay-TV ARPU was ~~$102.71~~$104.07 during the three months ended ~~March 31,~~June 30, 2023 versus ~~$99.44~~$101.30 during the same period in 2022. The ~~$3.27~~$2.77 or ~~3.3%~~2.7% increase in Pay-TV ARPU was primarily attributable to the DISH TV and SLING TV programming price increases. The DISH TV and SLING TV programming package price increases were effective in the fourth quarter of 2022.

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Cost of services. “Cost of services” totaled ~~$1.857~~$1.782 billion during the three months ended ~~March 31,~~June 30, 2023, a decrease of ~~$34~~$106 million or ~~1.8%~~5.6% compared to the same period in 2022. The decrease in “Cost of services” was primarily attributable to a lower average Pay-TV subscriber base, partially offset by higher programming costs per ~~subscriber and higher variable and retention costs per~~ subscriber. Programming costs per subscriber increased during the three months ended ~~March 31,~~June 30, 2023 due to rate increases in certain of our programming contracts, including the renewal of certain contracts at higher rates, particularly for local broadcast channels. In addition, variable and retention costs per subscriber increased during the three months ended March 31, 2023 due to, among other things, approximately $30 million in cyber-security-related expenses incurred by us and DISH Network to remediate the incident and provide additional customer support. “Cost of services” represented ~~63.5%~~62.5% and ~~60.8%~~61.0% of “Service revenue” during the three months ended ~~March 31,~~June 30, 2023 and 2022, respectively.

In the normal course of business, we enter into contracts to purchase programming content in which our payment obligations are generally contingent on the number of Pay-TV subscribers to whom we provide the respective content. Our “Cost of services” have and will continue to face further upward pressure from price increases and the renewal of long-term programming contracts on less favorable pricing terms. In addition, our programming expenses will increase to the extent we are successful in growing our Pay-TV subscriber base.

Selling, general and administrative expenses. “Selling, general and administrative expenses” totaled ~~$336~~$380 million during the three months ended ~~March 31,~~June 30, 2023, a ~~$66~~$16 million or ~~16.4% decrease~~4.4% increase compared to the same period in 2022. This change was primarily driven by ~~a decrease in subscriber acquisition costs resulting from lower~~higher marketing expenditures and ~~lower gross new DISH TV subscriber activations.~~an increase in costs to support our business.

Depreciation and amortization. “Depreciation and amortization” expense totaled ~~$84~~$82 million during the three months ended ~~March 31,~~June 30, 2023, ~~a $12~~an $8 million or ~~12.5%~~8.5% decrease compared to the same period in 2022. This change was primarily driven by a decrease in depreciation expense from equipment leased to new and existing DISH TV subscribers and the Anik F3 satellite. Through the first quarter of 2022, our Anik F3 satellite was accounted for as a finance lease. However, during April 2022, we extended the Anik F3 lease and, as a result, it is currently accounted for as an operating lease.subscribers.

DISH TV SAC. DISH TV SAC was ~~$1,055~~$1,169 during the three months ended ~~March 31,~~June 30, 2023 compared to ~~$1,088~~$980 during the same period in 2022, ~~a decrease~~an increase of ~~$33~~$189 or ~~3.0%~~19.3%. This change was primarily attributable to ~~a decrease~~an increase in advertising costs per subscriber ~~partially offset by~~and higher installation costs due to an increase in labor and other installation costs.

During each of the three months ended ~~March 31,~~June 30, 2023 and 2022, the amount of equipment capitalized under our lease program for new DISH TV subscribers totaled ~~$15~~$12 million.

To remain competitive, we upgrade or replace subscriber equipment periodically as technology changes, and the costs associated with these upgrades may be substantial. To the extent technological changes render a portion of our existing equipment obsolete, we would be unable to redeploy all returned equipment and consequently would realize less benefit from the DISH TV SAC reduction associated with redeployment of that returned lease equipment.

Our “DISH TV SAC” may materially increase in the future to the extent that we, among other things, transition to newer technologies, introduce more aggressive promotions, or provide greater equipment subsidies.

Interest ~~income.~~expense, net of amounts capitalized. “Interest ~~income”~~expense, net of amounts capitalized” totaled ~~$120~~$185 million during the three months ended June 30, 2023, a decrease of $46 million compared to the same period in 2022. This decrease was primarily related to a reduction in interest expense resulting from the redemption of our 5 7/8% Senior Notes due 2022 on July 15, 2022 and our 5% Senior Notes due 2023 on March ~~31,~~15, 2023.

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Six Months Ended June 30, 2023 Compared to the Six Months Ended June 30, 2022.


	For the Six Months Ended
	June 30,						Variance
Statements of Operations Data	2023			2022			Amount			%

	(In thousands)
Revenue:
Service revenue	$	5,776,505		$	6,202,078		$	(425,573)		(6.9)
Equipment sales and other revenue		121,065			52,347			68,718		*
Total revenue		5,897,570			6,254,425			(356,855)		(5.7)

Costs and Expenses:
Cost of services		3,638,829			3,777,910			(139,081)		(3.7)
% of Service revenue		63.0	%		60.9	%
Cost of sales - equipment and other		39,738			42,794			(3,056)		(7.1)
Selling, general and administrative expenses		715,902			765,898			(49,996)		(6.5)
% of Total revenue		12.1	%		12.2	%
Depreciation and amortization		165,732			185,334			(19,602)		(10.6)
Total costs and expenses		4,560,201			4,771,936			(211,735)		(4.4)

Operating income (loss)		1,337,369			1,482,489			(145,120)		(9.8)

Other Income (Expense):
Interest income		231,790			210,401			21,389		10.2
Interest expense, net of amounts capitalized		(383,311)			(462,579)			79,268		17.1
Other, net		(674)			1,245			(1,919)		*
Total other income (expense)		(152,195)			(250,933)			98,738		39.3

Income (loss) before income taxes		1,185,174			1,231,556			(46,382)		(3.8)
Income tax (provision) benefit, net		(294,253)			(303,965)			9,712		3.2
Effective tax rate		24.8	%		24.7	%
Net income (loss)	$	890,921		$	927,591		$	(36,670)		(4.0)

Other Data:
Pay-TV subscribers, as of period end (in millions)		8.904			9.988			(1.084)		(10.9)
DISH TV subscribers, as of period end (in millions)		6.901			7.791			(0.890)		(11.4)
SLING TV subscribers, as of period end (in millions)		2.003			2.197			(0.194)		(8.8)
Pay-TV subscriber additions (losses), net (in millions)		(0.846)			(0.719)			(0.127)		(17.7)
DISH TV subscriber additions (losses), net (in millions)		(0.515)			(0.430)			(0.085)		(19.8)
SLING TV subscriber additions (losses), net (in millions)		(0.331)			(0.289)			(0.042)		(14.5)
Pay-TV ARPU	$	103.38		$	100.35		$	3.03		3.0
DISH TV subscriber additions, gross (in millions)		0.233			0.315			(0.082)		(26.0)
DISH TV churn rate		1.74	%		1.55	%		0.19	%	12.3
DISH TV SAC	$	1,114		$	1,035		$	79		7.6
Purchases of property and equipment	$	61,414		$	60,432		$	982		1.6
EBITDA	$	1,502,427		$	1,669,068		$	(166,641)		(10.0)
OIBDA	$	1,503,101		$	1,667,823		$	(164,722)		(9.9)

* Percentage is not meaningful.

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Pay-TV Subscribers

DISH TV subscribers.We lost approximately 515,000 net DISH TV subscribers during the six months ended June 30, 2023 compared to the loss of approximately 430,000 net DISH TV subscribers during the same period in 2022. This increase in net DISH TV subscriber losses primarily resulted from lower gross new DISH TV subscriber activations and a higher DISH TV churn rate.

SLING TV subscribers. We lost approximately 331,000 net SLING TV subscribers during the six months ended June 30, 2023 compared to the loss of approximately 289,000 net SLING TV subscribers during the same period in 2022. The increase in net SLING TV subscriber losses were primarily related to higher SLING TV subscriber disconnects, partially offset by higher SLING TV subscriber activations in 2023. We continue to experience increased competition, including competition from other subscription video on-demand and live-linear OTT service providers.

DISH TV subscribers, gross.During the six months ended June 30, 2023, we activated approximately 233,000 gross new DISH TV subscribers compared to approximately 315,000 gross new DISH TV subscribers during the same period in 2022, a decrease of 26.0%. This decrease in our gross new DISH TV subscriber activations was primarily related to the lack of demand, shifting consumer behavior, and lower marketing expenditures, as well as increased competitive pressures, including, but not limited to, live-linear OTT service providers, aggressive short term introductory pricing and bundled offers combining broadband, video and/or wireless services and other discounted promotional offers, and direct-to-consumer offerings by certain of our programmers. Our gross new DISH TV subscriber activations continue to be negatively impacted by an emphasis on acquiring higher quality subscribers.

DISH TV churn rate. Our DISH TV churn rate for the six months ended June 30, 2023 was 1.74% compared to 1.55% for the same period in 2022. Our DISH TV churn rate for the six months ended June 30, 2023 was briefly elevated due to the cyber-security incident. Our DISH TV churn rate continues to be adversely impacted by external factors, such as, among other things, cord cutting, shifting consumer behavior and increased competitive pressures, including, but not limited to, live-linear OTT service providers, aggressive marketing, bundled discount offers combining broadband, video and/or wireless services and other discounted promotional offers. Our DISH TV churn rate continues to be positively impacted by our emphasis on acquiring and retaining higher quality subscribers. Our DISH TV churn rate is also impacted by internal factors, such as, among other things, our ability to consistently provide outstanding customer service, price increases, our ability to control piracy and other forms of fraud, and the level of our retention efforts.

Service revenue. “Service revenue” totaled $5.777 billion for the six months ended June 30, 2023, a ~~$23~~decrease of $426 million or 6.9% compared to the same period in 2022. The decrease in “Service revenue” compared to the same period in 2022 was primarily related to lower average Pay-TV subscriber base, partially offset by an increase in Pay-TV ARPU, discussed below.

Equipment sales and other revenue. “Equipment sales and other revenue” totaled $121 million for the six months ended June 30, 2023, an increase of $69 million compared to the same period in 2022. The increase in “Equipment sales and other revenue” compared to the same period in 2022 was primarily related to a non-recurring $75 million license of our Adaptive Bitrate Streaming patents to Peloton covering certain Peloton products that resolves our litigation involving those products.

Pay-TV ARPU. Pay-TV ARPU was $103.38 during the six months ended June 30, 2023 versus $100.35 during the same period in 2022. The $3.03 or 3.0% increase in Pay-TV ARPU was primarily attributable to the DISH TV and SLING TV programming price increases. The DISH TV and SLING TV programming package price increases were effective in the fourth quarter of 2022.

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Cost of services. “Cost of services” totaled $3.639 billion during the six months ended June 30, 2023, a decrease of $139 million or 3.7% compared to the same period in 2022. The decrease in “Cost of services” was primarily attributable to a lower average Pay-TV subscriber base, partially offset by higher programming costs per subscriber and higher variable and retention costs per subscriber. Programming costs per subscriber increased during the six months ended June 30, 2023 due to rate increases in certain of our programming contracts, including the renewal of certain contracts at higher rates, particularly for local broadcast channels. In addition, variable and retention costs per subscriber increased during the six months ended June 30, 2023 due to, among other things, approximately $30 million in cyber-security-related expenses incurred by us and DISH Network to remediate the incident and provide additional customer support. “Cost of services” represented 63.0% and 60.9% of “Service revenue” during the six months ended June 30, 2023 and 2022, respectively.

Selling, general and administrative expenses.“Selling, general and administrative expenses” totaled $716 million during the six months ended June 30, 2023, a $50 million or 6.5% decrease compared to the same period in 2022. This change was primarily driven by a decrease in subscriber acquisition costs resulting from lower marketing expenditures and lower gross new DISH TV subscriber activations.

Depreciation and amortization. “Depreciation and amortization” expense totaled $166 million during the six months ended June 30, 2023, a $20 million or 10.6% decrease compared to the same period in 2022. This change was primarily driven by a decrease in depreciation expense from equipment leased to new and existing DISH TV subscribers and the Anik F3 satellite. Through the first quarter of 2022, our Anik F3 satellite was accounted for as a finance lease. However, during April 2022, we extended the Anik F3 lease and, as a result, it is currently accounted for as an operating lease.

DISH TV SAC. DISH TV SAC was $1,114 during the six months ended June 30, 2023 compared to $1,035 during the same period in 2022, an increase of $79 or 7.6%. This change was primarily attributable to an increase in advertising costs per subscriber and higher installation costs due to an increase in labor and other installation costs.

During each of the six months ended June 30, 2023 and 2022, the amount of equipment capitalized under our lease program for new DISH TV subscribers totaled $27 million.

Interest income. “Interest income” totaled $232 million during the six months ended June 30, 2023, a $21 million increase compared to the same period in 2022. This change was primarily related to non-cash interest income associated with our Intercompany Loan to DISH Network.

Interest expense, net of amounts capitalized. “Interest expense, net of amounts capitalized” totaled ~~$199~~$383 million during the ~~three~~six months ended ~~March 31,~~June 30, 2023, a decrease of ~~$34~~$79 million compared to the same period in 2022. This decrease was primarily related to a reduction in interest expense resulting from the redemption of our 5 7/8% Senior Notes due 2022 on July 15, ~~2022.~~2022 and our 5% Senior Notes due 2023 on March 15, 2023.

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Non-GAAP Performance Measures and Reconciliation

It is management’s intent to provide non-GAAP financial information to enhance the understanding of our GAAP financial information, and it should be considered by the reader in addition to, but not instead of, the financial statements prepared in accordance with GAAP. Each non-GAAP financial measure is presented along with the corresponding GAAP measure so as not to imply that more emphasis should be placed on the non-GAAP measure. We believe that providing these non-GAAP measures in addition to the GAAP measures allows management, investors and other users of our financial information to more fully and accurately assess both consolidated and segment performance. The non-GAAP financial information presented may be determined or calculated differently by other companies and may not be directly comparable to that of other companies.

EBITDA

EBITDA is not a measure determined in accordance with GAAP and should not be considered a substitute for operating income, net income or any other measure determined in accordance with GAAP. EBITDA is used as a measurement of operating efficiency and overall financial performance and we believe it is a helpful measure for those evaluating operating performance in relation to our competitors. Conceptually, EBITDA measures the amount of income generated each period that could be used to service debt, pay taxes and fund capital expenditures. EBITDA should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.


	For the Three Months Ended				For the Three Months Ended				For the Six Months Ended
	March 31,				June 30,				June 30,
	2023		2022		2023		2022		2023		2022

	(In thousands)				(In thousands)
Net income (loss)	$	433,283	$	444,411	$	457,638	$	483,180	$	890,921	$	927,591
Interest, net		78,414		135,249		73,107		116,929		151,521		252,178
Income tax provision (benefit), net		140,623		145,906		153,630		158,059		294,253		303,965
Depreciation and amortization		83,900		95,916		81,832		89,418		165,732		185,334
EBITDA	$	736,220	$	821,482	$	766,207	$	847,586	$	1,502,427	$	1,669,068

The changes in EBITDA during the three and six months ended ~~March 31,~~June 30, 2023, compared to the same ~~period~~periods in 2022, were primarily a result of the factors described in connection with operating revenues and operating expenses.

OIBDA

OIBDA, which is presented below, is a non-GAAP measure and does not purport to be an alternative to operating income (loss) as a measure of operating performance. We believe this measure is useful to management, investors and other users of our financial information in evaluating operating profitability of our business on a more variable cost basis as it excludes the depreciation and amortization expenses related primarily to capital expenditures and acquisitions, as well as in evaluating operating performance in relation to our competitors. OIBDA is calculated by adding back depreciation and amortization expense to operating income (loss).


	For the Three Months Ended				For the Three Months Ended				For the Six Months Ended
	March 31,				June 30,				June 30,
	2023		2022		2023		2022		2023		2022

	(In thousands)				(In thousands)
Operating income (loss)	$	652,899	$	724,776	$	684,470	$	757,713	$	1,337,369	$	1,482,489
Depreciation and amortization		83,900		95,916		81,832		89,418		165,732		185,334
OIBDA	$	736,799	$	820,692	$	766,302	$	847,131	$	1,503,101	$	1,667,823

The changes in OIBDA during the three and six months ended ~~March 31,~~June 30, 2023, compared to the same ~~period~~periods in 2022, were primarily a result of the factors described in connection with operating revenues and operating expenses.

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Item 4.CONTROLS AND PROCEDURES

Conclusion regarding disclosure controls and procedures

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this report. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report.

Changes in internal control over financial reporting

There has been no change in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934) during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II — OTHER INFORMATION

Item 1.LEGAL PROCEEDINGS

See Note 9 “Commitments and Contingencies - Litigation” in the Notes to our Condensed Consolidated Financial Statements for information regarding certain legal proceedings in which we are involved.

Item 1A. RISK FACTORS

Item 1A, “Risk Factors,” of our Annual Report on Form 10-K for the year ended December 31, 2022 includes a detailed discussion of our risk factors.

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Item 6.EXHIBITS

(a)

Exhibits.



22◻		List of Subsidiary Guarantors

31.1◻		Section 302 Certification of Chief Executive Officer.

31.2◻		Section 302 Certification of Chief Financial Officer.

32.1◻		Section 906 Certification of Chief Executive Officer.

32.2◻		Section 906 Certification of Chief Financial Officer.

101◻		The following materials from the Quarterly Report on Form 10-Q of DISH DBS for the quarter ended ~~March 31,~~June 30, 2023, filed on ~~May 12,~~August 9, 2023, formatted in Inline eXtensible Business Reporting Language (“iXBRL”): (i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Operations and Comprehensive Income (Loss), (iii) Condensed Consolidated Statements of Changes in Stockholder’s Equity (Deficit), (iv) Condensed Consolidated Statements of Cash Flows and (v) related notes to these financial statements.
104◻		Cover Page Interactive Data File (the cover page XBRL tags are embedded in the Inline XBRL document).

◻Filed herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	DISH DBS CORPORATION


	By:	/s/ W. Erik Carlson
		W. Erik Carlson
		President and Chief Executive Officer
		(Duly Authorized Officer)

	By:	/s/ Paul W. Orban
		Paul W. Orban
		Executive Vice President and Chief Financial Officer
		(Principal Financial Officer)

	By:	/s/ James S. Allen
		James S. Allen
		Senior Vice President and Chief Accounting Officer
		(Principal Accounting Officer)

Date: ~~May 12,~~August 9, 2023

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