EchoStar Corporation Class A Aktie

Greetings, and welcome to EchoStar Corporation Fourth Quarter 2025 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded.

I would now like to turn the conference over to your host, Mr. Dean Manson. Thank you. You may begin.

Thank you. Welcome to EchoStar's Third Quarter -- Year-End 2025 Earnings Call. We will begin with opening remarks from Hamid Akhavan, CEO of EchoStar Capital; followed by Charlie Ergen, CEO and Chairman of EchoStar.

We request that any participant producing a report not identify other participants or their firms and such reports. We also do not allow audio recording, which we ask that you respect.

All statements we make during this call, other than statements of historical fact constitute forward-looking statements made pursuant to the safe harbor provided by the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause our actual results to be materially different from historical results and from any future results expressed or implied by the forward-looking statements. For a list of those factors and risks, please refer to our annual report on Form 10-K for the fiscal year ended December 31, 2025, filed today, March 2, and our subsequent filings made with SEC. This information and supplemental materials related to today's call will be posted on our Investor Relations website.

All cautionary statements we make during this call should be understood as being applicable to any forward-looking statements we make wherever they appear. You should carefully consider the risks described in our reports and should not place any undue reliance on any forward-looking statements. We assume no responsibility for updating any forward-looking statements.

We refer to OIBDA and free cash flow during this call. The comparable GAAP measure and a reconciliation for OIBDA is presented in our earnings release and in the case of free cash flow in our Form 10-K as filed today with the SEC. Before we begin, I will also note that EchoStar has filed an application that will allow us to participate in the FCC's upcoming AWS-3 spectrum auction designated as Auction 113. Pursuant to the FCC's anti-collusion rules, we are currently in a quiet period. Accordingly, we will not be making any comments or responding to any questions that relate to Auction 113.

With that, I'll turn it over to Hamid.

Thank you, Dean. Welcome, everyone, and thank you for joining us today to discuss our 2025 end-of-year results. Before I hand over to Charlie, I would like to briefly comment on a few topics relevant to EchoStar Capital. As we await final regulatory approvals for our spectrum sale and the resulting influx of capital expected during the first half of this year, we remain committed to being excellent stewards of capital. If preparing to allocate and utilize these funds based on our view of how we might maximize shareholder returns with actions and spending from immediate to over the long horizon.

Our decisions are based on many considerations, including paying down expensive or maturing debt obligations, our current and anticipated tax liabilities and any mitigating avenues and investments and development opportunities at EchoStar Capital versus returning excess capital to the shareholders through the common short-term remuneration options. These considerations of both complex and interrelated, further complicated by dynamic external factors such as the possibility and the timing of a potential SpaceX IPO.

With this context as background, it would be difficult and potentially misleading for us to provide significant detail on most of these topics at this time. EchoStar is in means of a large-scale positive transformation arising from its vision, long horizon and strategic bets and decades of diligent execution. We feel confident about our ability to continue operating on the same success principles, and navigate for the best shareholder outcome in the long run.

With that, I will now turn the call over to Charlie.

Thanks, Hamid. And as you guys know, I don't have any -- I don't normally have any opening statements and I don't today. So we will just jump into questions.

[Operator Instructions] Our first question comes from Sebastiano Petti with JPMorgan.

Charlie or Hamid, I want to see if you could update us on how you're thinking about passive versus active investments within EchoStar Capital and notwithstanding your prepared remarks, is that still the right avenue or how you're kind of thinking about it? And within that context, given anticipated IPO of SpaceX would increasing or EchoStar's stake within SpaceX be something you would be considering?

And then Charlie, big picture question. EchoStar did have an announcement about a DDD constellation, which obviously you will not be pursuing but how do you think you see -- how do you see that ecosystem evolving having spent decades around the industry the convergence of wireless and satellite, I think you have a unique perspective. So I just love to hear your thoughts. Do you see this as complementary? Do you see this as a threat to the incumbents having experience trying to be a fourth player yourself?

I will try to and I'll try to answer the first few questions are all wrapping on. I apologies I missed some of it. Please repeat that. Look, EchoStar Capital, as I mentioned, we are looking at every possibility for utilization of the liquidity and cash when it arrives. As I mentioned, we're looking at short-term options, traditional. We turn to the shareholders through the best means. Obviously, we're looking at the long horizon for creating value, all of this in the context of taxation and how the net return to the shareholders may be we obviously looking at our opportunities every single day. And and judging that against what other options may be available. So it's a long answer to a short question, but honestly, that is the case, it would be foolish to do anything other than that.

We don't actually -- until the closing, we don't have actually a SpaceX excess equity. So that is not one thing that we can make any plans on to. We actually get the equity. We have a right to it, but we don't have the -- we actually don't have that equity yet. So we'll see how that plays out. IPO may happen, obviously, it will happen independent of our plans, but we'll make sure that we maximize our options around the timing whenever that shows up and what options you might have.

In terms of holding the size of the equity we have from SpaceX, I think we'd be very happy with that at this point. I don't think we are actively looking necessarily to make any transactions at this point based on that. So that remains on our balance sheet until we get it. And then after that, we'll decide how to proceed dependent conditions at that time. I am looking at both active and passive investments, again, depending on the return. So we'll keep you posted as soon as we get to the point that we actually have that cash at hand and ready to make some transactions.

Charlie, I think the was rest for you.

Yes. So on direct to device, I mean, obviously, we're disappointed that we weren't able to continue with something we've built over 17 years. And I think we're proud of the fact that we've helped create an ecosystem for a direct advice. And I think that we're also pleased that -- and we've made our bet and that's with SpaceX and StarLink. We see them as the most viable company to do that. And with the tremendous technology and launch capabilities. They're well positioned to certainly be a leader in that. We're -- as we publicly disclosed, we already have an agreement with them to provide that to our customers.

They obviously are going to -- Mobile World Congress is going on now, I expect there'll be quite a few announcements there. There'll be other players in the marketplace. But I don't think you're going to see too much from anybody except SpaceX in the near term or StarLink in the near term, and I think that based on our experience, that's the that's the company we think will be the leader.

Our next question is from Brent Penter with Raymond James.

First one for me, a follow-up on Sebastiano's question on SpaceX. So based on the deals, I think you all were supposed to get around a 2.8% stake, which at the time was valued at $400 billion. As you mentioned, these deals haven't closed yet, but they've since announced the merger with [ X AI ]. So how does that [ X AI ] deal affect your ownership in terms of percentage? And how can we think about any kind of mark-to-market associated with that deal?

Yes. This is Charlie. I don't think we know. I mean, I think we're not privy to what that IPO, if an IPO happens or what it would happen what it looked like. I think the merger appeared publicly to be something like 80-20 between [ X-AI ] and StarLink. So that's probably gives you a feel for what our investment might look like. But we just don't -- we don't have any internal information there today.

Okay. That makes sense. And then tower companies have announced that you all stopped paying them and you all talked about the litigation in your 10-K. Last quarter, you had said you believe that you were relieved of these payments but now you've actually stopped paying them. So just wondering what actually went into the decision to take that next step and stop paying?

Well, yes, thanks for the question. The first thing most important to us was, of course, to make sure that all of our customers on our network, we're not disenfranchised to buy the existential threat that we got when the FCC informed just of an investigation taker spectrum. So we believe that with that question is, of course, majeure event. But we wanted, first and foremost, take care of our customers, which we did, and we've moved successfully all our customers last year in the fourth quarter, we moved all our customers off of our network.

At that time, given the force majeure event and the FCC's action obviously we have a network that generates -- we have a network to generate no income. So it -- we informed all of our vendors that we had a force majeure in as we're allowed as we have per contracts. So -- and as you know, since that time, several companies have commenced litigation against our independent dish wires entity, which is party to the relevant tower agreements. And I'm disappointed in that because by contrast, those companies who haven't litigated, we've had good open faith negotiations, and we've settled hundreds of contracts.

And most recently, we signed a settlement agreement with a large tower company who didn't commence litigation because at that point, principles can talk to principles. When the other companies, it's lawyers. And so you can expect protract at my experience has been that, that will be protracted litigation because the lawyers talk to the lawyers, and they don't typically a hurry to anything done. And it's just different than when business people talk to business people.

I wish you weren't here, I wish it's an ongoing evolving situation, but we'll continue to appropriately respond to any litigation that's been commenced. We'll assess all of our available steps in front of any ports or venues, and we'll engage with more tower companies to see a consensual solutions, and we'll consider all our alternatives available to the company -- to the company that's party to the tower contracts to resolve these matters and -- but it's obviously for the tower companies in conventional litigation, that's all public and that likely typically, the wheels of justice don't move very quick and that will probably take some time before we actually know all the results of that.

But we don't believe -- just to be clear, we don't believe we'll any money. And I think it shows our good faith that we've with a lot of people and attempted to engage in negotiations with people when people don't pick litigation.

Okay. And can you remind us what assets exactly are held at that DISH wireless entity?

In general, Paul, do you want to take that?

Yes, sure. In general, it's the 5G network build. So it's all the assets that were deployed to build the network and have it operational. So antennas servers so forth -- anything you would need radios and so forth and so on. So yes.

So kind of the other segment that you're now reporting?

Correct. The other segment has those assets entered, yes.

Our next question comes from David Barden with New Street Research.

Two, if I could. First would be just, Hamid, could you talk about how the approach to the vendor payment situation impacted fourth quarter results in the wireless segment from an EBITDA perspective? And how -- when you do reach a settlement, how does that all run through? Is there -- I guess, we're not going to be able to predict it, but it would be fun to know how it's all working.

And then I guess, second, Charlie, just to confirm, you don't have an any dilution provision it sounds like but when you see Elon kind of plugging $1 trillion valuation for SpaceX out of the air when it was $400 billion in June and $250 billion for [ X-AI ]. As a large shareholder, where a large part of your stock value is this holding how much credence do you put in that? Like what do you really think it's worth? Because -- or do you really believe that it's worth $1.25 trillion put together?

Let me take the first part, I'm going to generally answer -- let me take the second part, and I'll generally answer the first part and turn the maybe to Paul. But again, I think that, again, our -- having spent decades on direct-to-device and space. It's our belief that SpaceX is a one-of-a-kind company. And I can't speak to the valuations, markets were up and down, but space is going to be an increasingly important aspect commercially. But obviously, you're seeing militarily and other things as well.

So in directed device, when you can connect -- it's not just phones, it's IoT, it's cars, you see anything mobility. When you connect any square into the planet, that's just a big business. And so I can only say it this way, that SpaceX is a company, and I'm not talking about just deal, I'm talking about the company and the management of that company. They've been the best company I've ever worked with in 45 years. So they're just responsive. They're creative. They move at a pace that most companies don't. So I think I don't think any amount of valuation is probably crazy there. Obviously, we're not privy to their numbers. So we invested on faith, and we invest in people, and we felt that the best people we could invest in.

So I'm anxious to see if they do in fact an IPO, obviously, a lot of things to look at. I'm anxious to look at that. But we're not -- we don't have insight is what -- we don't have -- we don't know what the value is, right, other than we believe than the transaction that we did we thought that initially we weren't getting the value for our spectrum. We thought with the growth of SpaceX that we likely could see that we could get to the value that we got that our spectrum held and it remains to be seen.

As far as what the question was about the cost for the network.

Yes. So let me address that. Thank you for the question. First of all, it's a little complicated. You have to go back to Q3 where we took the impairment charge that we recorded in that impairment charge were costs related to any future commitments where we had contracts. So for instance, the tower expenses would have been accrued for in that impairment charge. So you don't see those in the Q4 numbers. However, what you do see is just normal operating costs and accruals for normal operating costs that you have to run the network that's running through Q4. Hopefully, that makes sense.

[Operator Instructions] Our next question comes from Bryan Kraft with Deutsche Bank.

I had a couple, if you don't mind. First, I wanted to ask what the path is to getting the wireless business to profitability on an EBITDA basis. Secondly, I just wanted to ask you, how quickly do those connectivity expenses in the other segment go away over the course of 2026, it looks like about 70% might have been gone in 4Q based on the math I did. I don't know if that's right. But trying to figure out, does that go to 0 in 1Q or 2Q?

And then the last part of my question is, it's still your expectation that total decommissioning costs will be in that $7 billion to $10 billion range. And is there any further granularity that you could share on the tax liability component of that?

Paul, do you want to take that?

Yes. So the first on the Q4 cost that you had for the other segments, what you're going to see is over time, as we decommission all of our tower sites that, that number will decline, as you pointed out, it's not down to 0 yet, but you'll see a big decrease in that in Q1 and Q2. One thing to keep in mind though, those numbers do include that if you back into that number, it does include the noncash accretion on the lease liability. So like we talked about in the Q3 earnings call, we discounted back to today's dollars, the amounts that we owed on the lease and took that as an impairment charge. We needed to accrete that up over time. And so that's probably about half of the number that you're seeing going through the P&L there.

Okay. And then on the -- on how do we get DISH Wireless positive and profitable. I've now been involved for the last couple of months on the day-to-day operations. And so the it's just appointing where we are after 4 years. But we're very close to a breakeven business there. And I can tell you the way I look at it. The way I look at it is I look at the total cost of running that, including the hybrid core because that obviously has cost it doesn't have much cost of the network, but it obviously has cost.

And then I look at it for every new customer we get or they are profitable customer. In other words, I know we're making profit on the customers we have today. We've already invested in those customers. I've seen and that we can do that. But every company that we have here has to stand on its own. And we're not we're for-profit companies, and we have to make a profit in all our businesses. And so that will be the focus there. But we're close to being where we need to get to turn the corner, but we're not there yet. And then there was one other question, which I didn't -- I didn't go to understand the other question.

Is your expectation on the decommissioning cost, the $7 billion to $10 billion range that you had previously given. Is that still what you expect? And is there any further update you could give on the tax liability on the Spectrum transactions?

Yes. I think that the -- I think we've written off about $16 billion on the debt work decommissioning, which includes all the operational costs. And so it's a significant -- I mean we made a significant investment, and I think we wrote off about $16 billion. We think that in terms of taxes and further decommissioning that that's somewhere -- I think we believe that's in the $5 billion to $7 billion range today. And I think that's what we announced last quarter. But it's definitely -- there's nothing -- there's been no movement in our analysis of that yet. And obviously, it may take some time given the litigation, it may take some time to get to the final answer. It's in the $5 billion to $7 billion range is where we are today.

So sorry, $5 billion to $7billion is your updated view versus the 7 to 10 previously? Or just trying to clarify.

I think our really initial reaction was 7 to 10, and I think when pairs,maybe that number came out. But I think last quarter, I think we I think there was a range even in Paris of 5 to 10. And I think we got that down to 5 to 7 that doesn't mean that -- I mean, that's our best guess today, right, for taxes and decommissioning costs.

And to clarify, that's cash payments that we think we would make.

Dynamic, as I mentioned in my opening remarks, taxes, liabilities, investments, everything else, value in SpaceX. Everything else is in related is a dynamic picture is impossible, literally impossible to nail it down right now, given all the movements, some internal, some external beyond our control. So anything we give you outside of the estimation that we have, even the estimation we have it's just an estimation. I mean, things are changing very rapidly and be missing for us to give you a very precise number that can change tomorrow afternoon. So just that's the best we could do today. But obviously, as the variables gets reduced over time, we can give you a much barrage.

Our next question comes from John Hodulik with UBS.

A couple of questions for Charlie, if I could. First, Charlie, any high level thoughts on the Paramount, Warner Bros. deal. What that means for linear TV distribution? And maybe do you think it will affect the industry's ability to offer ski bundles going forward, which would seem to be driving a lot of the improvement we've seen in cord cutting?

And then number two, I don't know how much you can comment on this, given the upcoming auction, but just anything you can say about further spectrum sales, maybe timing or whether we should expect them and sort of the value of your sort of remaining Spectrum holdings?

Yes. On Paramount and Warner Brothers, I'd say we've had good relationships with both of those companies for a long, long time. Obviously, they're going to have a lot -- they're going to have a long regulatory process. So we'll have to see how that goes. But it's further concentration in an industry that is changing and to technically and the -- I always worry when you're competing against your own distributors. I mean, they have a direct fine to the consumer and you're competing against that, and they're a valued vendor that obviously will is something that we have to keep our eye on. But we'll wait for their filings, and they're both great companies and great management for both of those 2. So we'll see at the appropriate time whether we have any concerns.

The -- and then on -- what was the second question?

Spectrum sales.

Spectrum sales. Again, because of the auction, I'll I'm going to be very careful here. But look, it I think we agree with the leadership of the FCC that -- which is one of the things to do here is to get spectrum and get it used as quickly as we can. And that's led to the kind of situation that we're in today. And I think our goal is to find the spectrum that we continue to use as we can continue to have is find a home for that for the -- make sure that that's going to get used in the quickest and fastest and the best way for consumers and for leadership, technical leadership in the United States. And I hope maybe we play a part in that, but we may not -- so -- but it's still obviously a valuable asset that we have.

So I don't think we have any further questions. So I just want to make one thing. We are not going to we don't plan today to have a conference call in a couple of months after the first quarter. We certainly will have filings, but I don't think we'll have a lot to add to what we had today. I think we do plan to have a conference call after the second quarter. I think that hopefully, regulatory and our company looks and [indiscernible] time to get some structure around what he's doing. And I think we can give you a pretty good snapshot of but we're going, but we're obviously, we're optimistic about what we have and our ability to compete.

And so we look forward to August.

If there's material changes in the marketplace is something we could have a call. But at this point, we believe it's going to be August or in July or early August before we have another call unless something happens in the meantime, which we could have a call at any time, if that was the case. So thanks, everybody, for joining.

Thank you, everyone.

This concludes today's conference. You may disconnect your lines at this time, and we thank you for your participation.

Greetings, and welcome to the EchoStar Corporation Third Quarter 2025 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce Dean Manson, Chief Legal Officer.

Thank you, Joe. Welcome, everyone, to EchoStar's Third Quarter 2025 Earnings Call. We will begin with opening remarks from Hamid Akhavan, President and CEO of EchoStar Capital, followed by Charles Ergen, CEO and Chairman of EchoStar. We are also joined by other members of the leadership team.

We request that any participant producing a report not identify other participants or their firms in such reports. We also do not allow audio recording, which we ask that you respect.

All statements we make during this call other than statements of historical fact, constitute forward-looking statements made pursuant to the safe harbor provided by the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause our actual results to be materially different from historical results and from any future results expressed or implied by the forward-looking statements. For a list of those factors and risks, please refer to our annual report on Form 10-K for the fiscal year ended December 31, 2024, filed on February 27, 2025, and our subsequent filings made with the SEC. This information and supplemental materials related to today's call will be posted on our Investor Relations website.

All cautionary statements we make during the call should be understood as being applicable to any forward-looking statements we make wherever they appear. You should carefully consider the risks described in our reports and should not place any undue reliance on any forward-looking statements. We assume no responsibility for updating any forward-looking statements.

We refer to OIBDA and free cash flow during this call. The comparable GAAP measure and a reconciliation for OIBDA is presented in our earnings release and in the case of free cash flow in our Form 10-Q as filed with the SEC today.

With that, I'll turn it over to Hamid.

Thank you, Dean. Welcome, everyone, and thank you for joining us today. I would like to start by addressing the change in our call format this morning in that we have Charlie Ergen, our Founder and Chairman, here with us today. Charlie and I will provide some updates on our business, our recent transactions and discuss some changes within our organization.

As you know, we recently announced the signing of a series of major transactions, one with AT&T at the end of August and another with SpaceX in September, valued at approximately $23 billion and $19 billion, respectively. These transactions were instrumental in resolving the FCC's review of the company's spectrum utilization. Further, just this morning, we announced an amended definitive agreement with SpaceX, which builds up on the agreement the company entered into in September to sell EchoStar's unpaired AWS-3 spectrum license for approximately $2.6 billion in SpaceX stock. Once these transactions close, we will have the capital runway necessary to continue to expand our existing operations as well as the freedom to pursue new opportunities.

This focus on new growth avenues significantly broadens the aperture of our business going forward. In light of this increase in the scope of responsibilities for the company, Charlie and I have decided to create a new division focused primarily on capital management and M&A. Going forward, I will lead this new division as the CEO of EchoStar Capital. I will also continue to manage Hughes Network Systems. Charlie will take on the position of EchoStar CEO in addition to his role as Chairman. Managing our video and wireless operating business units, these changes are effective immediately.

Building up on a 45-year operating heritage across communications, media and technology infrastructure, EchoStar Capital will be a great steward of our resources. a vision and thesis-driven and strategic investment-oriented operation with a global perspective and a proven track record of value creation. Our institutional knowledge and experience uniquely positions us in the marketplace to create superior and lasting value through innovation, execution and integration, allowing us to invest in operating businesses, we can expand our capabilities and market reach and focus on initiatives that generate sustainable shareholder value. I'm incredibly excited about this opportunity and ability to usher in this new phase for EchoStar.

I will now hand off to Charlie for a few comments.

Well, it's good to be back on the call, and it's funny kind of way. But I just have a couple of comments and you knew my style is just to take questions because I never know what's on your mind. Hamid and I will do that and team.

One housekeeping issue is we agree with the President in the sense that we think corporations should just only file -- have to file twice a year instead of quarterly because it just takes -- by the time you finish the quarter, you're almost starting to work on the next one, it takes enormous amount of time. But since that hasn't changed, obviously, we'll still continue to file quarterly. But we may, from time to time, not do quarterly conference calls like this because we'll try to stay focused on our business. We will do a call next quarter for year-end. And obviously, we'll have a lot of things change between now and then. But after that, we may be sporadic in terms of how we do how to do these calls.

So with that, let's take questions.

[Operator Instructions] And the first question comes from the line of John Hodulik with UBS.

Maybe first on EchoStar Capital. Charlie, could you talk about how it will be capitalized? Will all the proceeds from the spectrum sales go into EchoStar Capital? Or just anything you could tell us about those proceeds would be great. And just what areas do you expect to invest in?

And then lastly, if I could, you still have the AWS-3 spectrum. Any update you can give us on the potential sale of that block? And just how do you think of relative value for the paired versus the unpaired transaction we just saw?

Yes. Thanks, John. I'm going to take the second part of your question. I'm going to have, I think, Hamid, the better person to answer the EchoStar Capital question.

But on AWS-3, the big picture is the sale to SpaceX is timely. I think it's because we still own the paired AWS-3 and we sold some spectrum to AT&T, the unpaired was for us, somewhat orphan spectrum. But in SpaceX hands, it gives them a lot of flexibility of combining uplink and downlink and it gives them a lot of flexibility for where spectrum might come in the future. So, for them, obviously, went for a lower price, but they're going to be able to make obviously much better use of it than we can in today's terms. And so -- and we're pleased to get SpaceX stock because we think that's -- Hamid will talk about this maybe later, but that's obviously the kind of the first place EchoStar Capital is going with the equity interest in SpaceX. And we can talk more about why we think that's an excellent investment.

The paired spectrum is we still have. Obviously, we would transact if there was a meaningful transaction. AWS-3 is quite a bit more valuable. When you -- for us, this is -- and I think other people -- I think the other carriers look at it the same way. When you look at spectrum, value comes really from three sources. One is, is it in phones? And so is it in devices. That was one of the biggest problems we had in building our own network was getting some of our spectrum in devices. But our AWS-3 paired spectrum has always been in devices for as long as I can remember. I doubt there's -- there may not be any phones in the United States that have AWS-3 spectrum in it. So it's already valuable in that sense because you don't have a bunch of extra cost on devices.

But the second thing is who uses AWS-3 and the three major carriers all use AWS-3 spectrum. It's a very wide band, 70 by 90 megahertz, it's a very wide band and all three of them use it. And in most cases, they're adjacent to our spectrum. So -- and then that brings up the third thing is most -- what does it cost you to deploy the spectrum. And in most cases, it's my understanding that the radios that are out there today, all can take our AWS-3 spectrum without having to climb the tower and put new radios in for the most part.

So it's a very valuable spectrum in that sense. We'll get a sense of that, obviously, as the auction comes up next year for some of the spectrum from a smaller swath of spectrum, but we're very comfortable with that spectrum. And we'll work with the FCC in terms of the auction rules and how that might all take place. But I think it's -- I think it's the most valuable piece of the spectrum we have, and we'll see where that goes. Hamid?

Yes. Thank you. I'll answer the question regarding the proceeds from the sales. Our intention is that all of that would be within the EchoStar Capital. And EchoStar Capital will -- I believe our shareholders would be remiss if we didn't take advantage of 45 years of our institutional heritage and thesis-driven innovation and execution in the broad fields that EchoStar has been involved in to maximize the value that they can get for that capital that comes into the company. I can't see too many companies that have the strategic understanding and the breadth that EchoStar brings to the table across telco, space, aero, defense and all the fields that the portfolio families of EchoStar have been leading and involved in.

Now obviously, we always will be great stewards of capital, and we'll maximize the use of the capital. And if distribution of capital is necessary, we'll do that in an optimized way to our shareholders as necessary. So the road map is not 100% laid out at the moment, depending on how we see the market and opportunities come to us, we'll try to take advantage of every opportunity in the best way. And as I said, I can't imagine too many companies out there with the breadth and knowledge that EchoStar has gathered over the past 45 years.

That's our plan at the moment. Obviously, as time goes on, we will be more specific about how and where we deploy that capital or any sort of distribution that could be decided in the future. But to start, we need to get all of that in place. The money is not here yet. So we have time to organize ourselves around how we would maximize the use of that capital.

Great. And one more follow-up, if I can. Just Charlie, any update on negotiations with the tower companies? And what happens to the entity, the DISH network that has the deals with the towers? Will that entity sort of stay in place?

Well, the -- obviously, we had some unprecedented kind of curve out on us when the SEC informed us that they were going to investigate take the spectrum. So obviously, we believe that's a force majeure event. And so we're happy to -- we'll work with all our vendors. Obviously, we're the biggest company that got affected by that. But obviously, we also have other vendors and people we worked with for a long time they're affected by that, and we'll work with them to the extent that they want to work with us to try to resolve those issues.

Unfortunately, one company has already commenced litigation, and that kind of sour some of the ability to talk to people because once things go into litigation, it's lawyers talking to lawyers and it's not business people talking to business people. And so that's a bit unfortunate. But -- the network is obviously an independent company when we did it, still an independent company. And it will obviously handle this through that entity. It will handle all these negotiations through that entity.

So we'll see where that shakes out, and we hope that everything can -- other than the current litigation, we hope that those things can be resolved, and we're open to have those discussions.

The next question comes from the line of Brent Penter with Raymond James.

A couple of follow-ups on some of John's questions. So you clearly are excited about the SpaceX stake that's now getting bigger. As you bring in some of this net cash, how do you think about that as an additional area to deploy capital? And as SpaceX raises additional capital, do you have rights in terms of maintaining or potentially growing your stake? Just help us think about that SpaceX stake and then where you might put your capital.

First of all, we are very excited about having that equity on our balance sheet. We consider that our first investment in EchoStar Capital. We believe that Equity has tremendous growth opportunities just by the fact that SpaceX has such a significant lead in the technology within the space and space is becoming the next infrastructure in the world as launch capabilities and cost has become economical and also global security and communication has become more important in the age of AI. So we see that as being a strategic holding. We obviously will keep that our balance sheet excited about having the additional $2.6 billion that joins it.

We certainly look to have additional investments of similar strategic nature as we -- as I mentioned, there's a number of areas, a number of industries that we have a heritage and a deep thesis about understanding of those trends within the industry. We'll be very careful about investments that are synergistic with our thesis and understanding -- very excited about that opportunity.

I can't comment about us getting more SpaceX equity or some other transaction. As I said, we are just -- this is the first day of our announcement about how we're going to go forward. But we will be diversified. We'll certainly have -- we'll be great stewards of capital. And as time goes on, we'll be more specific about the transactions. Good news is that we still have a few more months before we even have the capital on our balance sheet. So we do have the time to do a proper job of planning and communicating with you where we're headed.

Yes. And I'm just going to follow up a little bit with -- this will give you some insight, I think, to the way Hamid and EchoStar will think about extra capital will think about things. But SpaceX in terms of -- we're excited about that as an investment. And what things we look at -- first thing we look at is management. And SpaceX management, we've got to work and gotten to know over the last 10 years because we've launched on them. And they really have been the best vendor that we've worked with the space and solve very complex problems for us to move very quickly. And then we've worked a lot closer, obviously, as we've gone through these deals. And so they don't brag about themselves. They're pretty understated, but they are doing -- based on my experience, they are doing incredible things with space, whether it be launching or satellites or services.

So the second thing you look at is, obviously, are they -- is this a place that over the next decade, there's going to be business. And as Hamid said, space is going to continue to grow particularly you see governments with golden dome and security, but it's also the consumer and the ability to do broadband from satellite and also connected devices, those two things fit together. There's a lot of synergy between those two things in one company.

And the third thing is who's going to be the winners and losers. And we look at other industries, I don't know who the winner in AI is going to be. One thing I'm sure of, there will be winners and there will be losers. I just don't know which one will be winners and which ones will be losers. But in space, I think it's pretty obvious that while there's some companies doing some very interesting and creative things, SpaceX is going to be the leader for the foreseeable future because they have the most efficient launch capability and satellite manufacturing capability, in my opinion, that I've seen.

So when you add all that together, and then I think we built for 17 years, this ability to technically be able to go satellite device and regulatory-wise in the spectrum and all those kind of things. We've now -- that's now in SpaceX hands or will be in SpaceX hands. And we know that worldwide capability and the same frequency, we know that that's -- we would have built a good system, but they're going to build even a greater system in a faster period of time. So that's going to be -- that's going to grow their business by -- that's going to -- that business by itself is going to be a huge part of where they grow. That's not probably in people's calculations of their value today. So that gives you a feel how we think about things.

Okay. Great. I appreciate all the detail there. And then a follow-up on the tower side. Since you all feel that you're relieved of those tower payments, what would actually cause you to stop making your payments to the tower companies? And then just any update on the timing of when we might have a resolution as we think about litigation and negotiations with them?

Yes. I just don't think we would get into that. I mean the only thing I would say is litigation is not positive.

The next question comes from the line of David Barden with New Street Research.

I guess my first question, Charlie, there weren't many numbers in the press release today about the SpaceX AWS-3 unpaired deal. But one of those numbers was that you pay or you invested at a $212 price. So could you, for the public side investors, tell us what information do you have? What information can you share to support what apparently is your belief that $212 is an appropriate valuation for the SpaceX company today?

And then I guess my second question is maybe for Hamid or maybe also Charlie. The taxes on the asset sales, Joe, what the taxes would be helpful kind of given all the different moving parts on depreciation and capitalized interest. But also there's a theory out there that if your frustration of purpose argument works with respect to the towers that you have access to the 1033 stepped-up basis on these spectrum sales and that the taxes could be far less than maybe the market imagined. So I wonder if you could kind of opine on that.

Yes. So I really -- in terms of valuation of SpaceX, I would just say that I think I'm always repeat myself that we don't -- we have a pretty good feel of what they're doing and where they are. I think they just publicly announced 8 million customers and in broadband, I think you could overlay their growth in broadband and then overlay a device growth and look along that same curve, and you would see a greater -- much greater valuation than the $400 million. So -- and again, as I said, the management team is excellent and understated in my opinion, in terms of what they do. And they have a pretty big moat around their business. They have 90% of the launch business, and that's -- and they've launched the new generation of satellites, which is at least twice as big as anything else out there, maybe even bigger. They've launched it 12x and they've caught it, returned back, right? And other people unfortunately are struggling to get their first ones up.

So I just think -- I actually, I think their lead is actually growing. Their biggest competitor is China probably, but China, I don't know this has even successfully landed rocket. So their lead is big and growing. So if you had to pick a winner in an industry, from my opinion, I could be wrong on this, of course. And while they'll face competition and there's creative things going on in their space, they're the most obvious, of any industry that I know, they're the most kind of obvious winner, right, in terms of every other industry, you just got a lot of people that you just don't know who roughly ends up on top. And of course, SpaceX still has challenges to get through, but -- and there's still risk there. But that's the way we think about it. That's the way we'll think about things that our capital, who has those characteristics.

On the tax side of it, we're well aware of 1033, but maybe I turn it over to Paul, do you want to take that?

I'll make a comment on then we go with Paul. First of all, I absolutely endorse Charlie's statements on SpaceX. But first, we want to mention that we are not insiders to SpaceX. So we have no inside knowledge of SpaceX. And Charlie and I views are 100% aligned and common on how great a SpaceX is, but that's just personal views. And based on what we have seen, you should rely on SpaceX's statements on what they see about the valuation of the business. We are excited about having that equity -- just -- as Charlie said, we see all the trends in the space being good and SpaceX being a leader in there. Naturally, we think that this is a good place for us to go.

Now on taxes, we have not broken out the taxes separately from our other liabilities in the towers and others that we just referenced. As we have previously said, we've not sharpened our numbers since the last time we spoke in Paris. We still believe that somewhere in the range of $7 billion to $10 billion is the combination of our unoptimized taxes and unoptimized value of our liabilities. So that range is what we essentially think we have.

Now can 1033 provide additional benefit and reduce that number? I'll ask Paul. He might have some knowledge in terms of how applicable that may be, Paul. Maybe you can comment on that.

Thanks. So there's a lot of puts and takes there. Obviously, the AT&T transaction is going to close in '26. The SpaceX transactions expected to close in '27. We have NOLs that play into the mix. And we're going to do everything we possibly can to mitigate the exposure. We're working on that currently. But the range that Hamid gave that includes both decommissioning costs and tax of $7 million to $10 million is still currently our best estimate.

So just to follow up real quick. The 1033 is not in the $7 to $10 million, but it's a possibility. Does it -- is it contingent on kind of how these litigations go and whether you're successful in making this frustration of purpose argument, which would allow you to kind of move up the basis and shift assets to another class?

I'll just say, it's been used. I think some of the 600 megahertz broadcasters when they put a spectrum in auction, I think they used 1033 in some cases successfully.

So we're aware of it. And obviously, it's -- there seems to be a lot of similarities between how it's been used in the past, but everything is specific, and we'll look at that as part of our strategy. And I don't think it's contingent.

Yes. I would just add to what Charlie said, it's not contingent on what happens with the litigation. Those are totally independent concepts.

The next question comes from the line of Walter Piecyk with LightShed.

On SATS cap, I assume all the cash from all the spectrum sales is going into there. Does that keep it away from DBS shareholders and any OpEx obligations, meaning like the tower companies?

And then, Hamid, you kind of like danced around returning the capital saying if it's necessary to do it. I don't know when it's ever like required that you distribute cash. But can you give us a little bit more color on kind of at what point do you say, hey, we've used our 45 years of experience. We've looked around. There's not enough interesting stuff, and we're going to send cash to the shareholders.

Let me take that piece first. Look, first of all, comments of dancing around. First of all, Walter, it's a little early for me to give you an exact formula or recipe or road map for how we're going to utilize the cash. But as you would expect, as any great company that has institutional knowledge and heritage within certain verticals, the best ability, the best option usually is to use that knowledge to deploy the capital because they're strategic. They're the insiders to an industry that a financial investor from outside will never, never get that insight, right? So we would be remiss not to take advantage of all that institutional knowledge and return the capital to shareholders that would now they have to deploy that capital in a way that they would not take advantage of this disability.

I think the shareholders that have been with us, and we have great ones around the table right here, Charlie himself, would certainly want us to maximize the value. Now there's a limit to that. If I had $2 trillion, I couldn't use all of it. How much institutional knowledge I have, I probably couldn't use enough because the industry just doesn't have that ability or just the opportunity is not there because the market is not good or the industries that we are focused on are out of favor or they just don't have enough great opportunities for us, then we obviously, as great stewards of capital, we figure out how we would distribute that capital back to the shareholders in a tax-optimized way. We are not novices in this. And certainly, we're not walking into this without a full understanding of the options ahead.

The only thing I can say is that we have deep heritage. This company has proven it can return value by the fact that you have seen for the past year, the thesis that Charlie had put in place decades ago has come to play. There's much more we could do there. But if at the end of the day, we have excess capital beyond what we can properly use -- strategically use, we certainly will not sit on it in an unoptimized way. Very, very early stage for me to make any further detail on that. It would be premature for me to say that. Just trust us that we'd be great stewards of capital. We manage it like our own capital as it is our own capital primarily.

And then just is this protected from DBSD and the tower companies?

And then just really a follow-up on that. Can you at least say that you're not going to like build a network or something of that ilk? These are really more passive investments that you're giving -- that you're using your years of expertise to look at?

Yes. This is Charlie. I'll take -- maybe Paul want to jump in there, but the -- obviously, our capital structure is well known, and they are obviously separate independent entities for specialized purposes. One thing that is clear for the AT&T transaction is we will be paying to DBS. DBS will receive about $2.8 billion for Tranche B, which is the C-band spectrum that we're selling to -- that's collateral there. So the one thing you can say is that there will be capital moving into DBS at at least $2.8 billion.

And then just on the types of investments, is this -- I assume these are not operational. These are all passive like, hey, we're investing in great new things that maybe SpaceX gives us access to?

So, well, we certainly don't intend to be purely passive investors. We don't intend to do that because, obviously, we do not want to be, and it does not -- it's not in our best interest of our shareholders to become a fully act regulated company, investment company. We will have to manage this according to those rules, which means we'll make a combination of active and passive investments. And even when we make a passive investment, it will be strategic for us. It will be a thesis-driven investment. It will not be just -- we're not wealth managers. We don't view ourselves as just broadly deploying capital in the marketplace. And we only focus on areas where we understand.

Now in some cases, that investment cannot be a controlled investment or significant influence investment as is the case for SpaceX. The valuation of that company is very high. We would not be able to provide enough and we would not have access to enough equity to make that a control or significant influence as defined by the '40 Act. But we will balance that with other investments that we will have control and we will have operating influence to the point that we manage around any sort of regulation that will be in front of us. We will be much more precise in all of this as time goes on.

Great questions for today, but we are aware of how we need to manage that, and we are not going to become a passive investment company. We like to rely on our heritage of operations. As I mentioned, we think we can -- a combination of our understanding of technology, our ability to execute and our heritage of innovation will give us a very good platform to create great value.

And I would just add, realize we own and run three different companies today and Hughes and DISH and Sling and Boost. So -- and clearly, obviously, from a Boost perspective, we think we have -- that's a business that should grow. And obviously, the video business is somewhat challenged as it has been for a decade, but we still see those businesses lasting for a long time.

Yes. And we obviously have -- both Charlie and I have extensive operating experience, not just domestically, but also globally. We have a very broad range and scope of places and domains and verticals that we can deploy the capital effectively.

The next question comes from the line of Michael Rollins with Citi.

Charlie, in your brief opening comments, you described the reasons that you're going to do an earnings call for the fourth quarter was it's end of the year. And there's -- you alluded to changes that could be coming between now and then. I was just curious if you could give us a little bit of a preview or a road map of the range of potential changes that can continue to happen for EchoStar between now and your fourth quarter earnings call?

And then secondly, just a follow-up on kind of moving beyond being a wireless network operator. As you're selling the spectrum, at what point can you unplug the radios so that you're no longer meeting the minimum use requirements, but you're able to start saving money from doing that? Is it when these transactions close? Is it now that you've announced a few transactions and you have maybe some more possibly that you have to kind of figure things out for? Or what's the formula where you could just start unplugging?

Yes. On the second part of that, we work with -- we really need to work with regulators on that. And so those discussions are ongoing. And so it wouldn't be appropriate to discuss that. But obviously, we'll have more color on that early next year.

I'd say I'm going to give you a general answer because it's a very good question about what might happen between now and February. You asked a good question. I think while we -- I think we pivot two pivots in our company. One is the pivot to being a capital-rich company, maybe more asset-light. But the other pivot is within EchoStar, where I'm going to be involved in the day-to-day operations now is to pivot to long-term thinking. So we had to think about things short term because we're putting all our capital into the build-out of our network. And we had lots of requirements, regulatory to do that. So we did that. So we had to think about things in the rest of our businesses in a short-term way.

That historically is not the way we think as a company. One of our principles is to think long term, and we can get back to that principle now. And so I think you'll see that we're -- by making -- by thinking about things long term, we maybe we'll take a little bit of a step backward short term -- because when you go from short term to long term, it's a little bit of a step backward. But I think you'll see that in a general sort of way, we'll be more competitive in terms of what we're doing in some of our businesses.

We think about things in terms of long-term cash. We don't really think about it for EBITDA and those kind of metrics. We think about deploying capital where we get a return. And we think about strategically, particularly in wireless, where you're one of really five county cable, you're one of five companies that are basically doing the same thing. How do we do some things differently and how do we look like a little bit different animal than what everybody else is doing.

And so we're kind of going -- we were building the highway and we were Uber and we were building the highway. Now we get to be Uber, and we don't -- we just rent the highway. And so for that, that puts us in a little bit different situation. And I will say that I don't think people truly understand the efficiency of what we call a hybrid MNO where we rent the radios, but we have the core, basically the brain, the cloud and how the system operates. So we can have a differentiated experience for our customers. We can -- we do get a lot of data from what we're doing with customers so we can make that experience better and automate that experience. And yet we don't have the burden of building and maintaining the towers, which normally wouldn't be a problem, but our scale is so small that was a challenge for us.

So I don't know that I totally answered your question, but from a big picture, we're going to be thinking a little bit longer term in the core business.

The next question comes from the line of Ben Swinburne with Morgan Stanley.

Charlie, good to have you back on the call. Appreciate your time I was curious if you could talk about any opportunity to sort of wrap the remaining AWS-3 spectrum that hasn't been sold with the upcoming auction where you are, as you know, on the hook for any shortfall with a multibillion-dollar liability. Is there any opportunity with the FCC to sort of combine those two try to monetize the spectrum and also kind of derisk the auction from an EchoStar perspective? Would love any thoughts if you have any to share.

Yes, Ben, it's a good question, and I'm not going to answer it, but I'll talk around the edges of it. But I mean, obviously, this FCC put us in a difficult situation. We went kind of through the five stages of grief denial and anger and depression and now we're in acceptance, of course. And that's the first thing from our perspective.

The second thing is we really hadn't talked with the FCC folks for a couple of years. And once we started having conversations, we've gotten on the same path. And this FCC has quite the vision of -- we didn't totally agree with it, but they want spectrum to get used more quickly and for the benefit of more Americans. And it's hard to argue with that vision. And once we've started communicating, now we're in lockstep really with where the FCC wants to go, and it's our job to now work with them and make sure that every -- all our assets get put to the best use for American public.

Part of that indirectly goes to your question, as you look at the AWS-3 auction coming up, there potentially are ways to make that the most efficient auctions. There may be -- and we're in the process of those discussions with the FCC, and they will -- obviously, others will have input into that as well. But we at least have a sounding board to say, how can we share your vision this FCC to get the spectrum in use as quickly as possible and in the hands of people that will compete with it.

One of the great things about the AT&T deal we did is because of our MNO hybrid MNO deal with AT&T, we could actually use the spectrum that we sold to. So you can think about those things in a different way. And so this FCC is going to -- they have a vision of where they want to go, they're going to -- they're going to be the most influential FCC that I've worked with ever. And so it's our job to help them get there where they want to go, and that's what we're going to do.

That's helpful. And just a follow-up on the Boost business now that you're running it. The history of MVNOs, these are typically not great businesses, and I know this is a hybrid MVNO. But you sound excited about the opportunity. It's got revenue scale, but it's at least to a degree, but it's still burning a lot of cash flow. I know you're going to start decommissioning and you've started decommissioning the network. Just can you talk about, I guess, the strategic vision for the business? And then I don't know if there's any help you can give us on the path to getting this thing to cash flow positive now that you've switched models.

Yes. So the strategy is simple. We have to do things -- we have to do two things. right? And if you look at any company that's the fourth or fifth player, this is what they have to do to be successful. You have to do two things. You have to use technology in a way to be different. And you have to do things that the other guys aren't doing or they could do, but they won't do. It didn't make sense for them to do it.

So on the technology side, we've already made our first strategic move, which is an agreement with SpaceX for our Boost customers to have worldwide connectivity to the handset, both for voice, text and broadband. So I'm sure others will follow suit with SpaceX. But carriers now are -- many carriers have some choice as to who they might sign up with. And so there's a wide variety of where those carriers are going. We are highly confident that we have aligned with which the company is going to have the best technology, and we can do some things different than others. So we've already started that. That's two years away, probably realistically, but that we've already started.

How we do things differently, I think, is for our team to come up, we'll -- I officially start like Monday. So we'll start having strategic sessions on how we can think about how we do some things differently. I don't think it's a good path. I don't think we can be successful if we look just like the other guys. They just have too much scale.

And any help on just getting the business to profitability? I don't know how much of the expense base goes away when you fully convert, anything like that?

Those of you who have been with us for 30 years as a public company know that we'd like to run things for cash, and we don't like losing money. So I don't have a -- we'll have a lot more on that. But I think that as you move to long-term thinking, that becomes an easier path. And short term is always difficult. But that was -- that's just the cards that we had to play short term. Now we get to play a bit better. We're better as a company when we're thinking long term.

And we're definitely going to be -- and again, if -- I think the nature of our hybrid MNO, it's underestimated by the market. People try to say it's an MNO or that. It's a different animal. And the AT&T network that we ride on is a great network. And with our spectrum, they're already putting our C-band to use, is my understanding, some of it. So that network is only going to get better. And so I just think -- I think we could be more competitive. We certainly will be more competitive than we have been in the past.

Yes. So adding to that, one of the things that hopefully shortens the path to profitability is the reduction of the fixed cost of the business, which you can imagine is drastic. Certainly from a network side, you need a much greater scale to reach that profitability going to retire the fixed cost. Obviously, not having that shortens the horizons tremendously. And second, having an MVNO deal with AT&T kind of makes our costs more variable on a usage basis. So again, another way to create operating leverage for us as the more we sell, I mean, obviously, we don't need to have a large scale in order to reach growth.

So all the strategic things that Charlie is talking about, should get us to profitability in a much shorter horizon than you would have originally modeled. We're not going to give you that today. But obviously, as time goes on, that information might become more available to you. We're excited about -- we're really excited about our ability to develop that business as the most scaled MVNO -- hybrid MNO, MVNO model in the marketplace with the benefit of having access to space and having to the great coverage of AT&T, which is using our spectrum now will be the best coverage in the nation in our view.

The next question comes from the line of Bryan Kraft with Deutsche Bank.

Had a few, if I could. First is a follow-up on the tax side. I was wondering if you could confirm that there will be a tax benefit from the impairment charge that you're taking today? And is that benefit excluded from the $7 billion to $10 billion range that you cited?

Secondly, just a follow-up on AWS-3 and the auction. Does the timing of the auction matter as it relates to you selling the paired AWS-3 licenses? Is it optimal to wait? Is it better to do it first? Just wondering how you're thinking about that? And then also the converts, I was wondering if ultimately you plan to settle those in cash or stock?

And then lastly, I would just love to hear your latest thoughts, Charlie, on a potential DBS merger with DIRECTV at this point in time.

Paul, do you want to take the first?

Yes. This is Paul. Good question there. I'll take the tax question. As it relates to the impairment charge, some of the items have already been deducted. For instance, we take bonus depreciation on the network or amortize the FCC spectrum. So we won't get a benefit of that. But the other costs, we will. And to answer your question, is that included in the $7 billion to $10 billion range? Yes, that is.

And this is Charlie. In terms of AWS timing, and so again, that's -- I wish I could give you more information, but we're really working with the FCC to make that, a, to make sure this most successful auction possible and that spectrum gets used as quickly as possible. But we're -- again, it's pretty valuable spectrum, I'd say that. And as part as the converts, we'll make a decision at the time that we can call those converts as to whether we call them or not. And if so, is it cash or stock or some combination of that. That would just be premature to speculate on that today.

And Hamid, maybe I'll throw over to you on DIRECTV.

Yes. Certainly, at EchoStar Capital, we look at every opportunity for value creation through inorganic transactions. The DISH and DIRECTV always has seemed like a natural combination and it's been an in-house combination. Our track record of making that work has not been great. So it's hard to predict how it might go. But certainly, we will always look at any opportunity to take advantage of assets we have in-house with a transaction.

I can't make any prediction right now about how that might go, but that item has always been on our radar, and Charlie has been very vocal about the fact that the combination of the two companies would create significant and tremendous amount of value.

Operator, we'll have time for one more question.

And the last question will come from the line of Chris Quilty with Quilty Space.

I was hoping you could possibly give a long-term update on the plans for one of those operating businesses, Hughes. You've obviously got downturns in the VSAT business and the consumer broadband. It looks like IFC is growing. Are there thoughts on either growing that business organically or nonorganically? And what markets are you most focused on?

Chris, thank you. Regarding Hughes, as you know, we have been on a multiyear journey at Hughes at least three years now. to transition that business more towards an enterprise business from a consumer business and purely from the realization and understanding that the consumer connectivity to satellite is now highly competitive given the SpaceX's offerings and perhaps in the future, other LEO offerings such as Kuiper. We recognized years ago that we could not have a LEO system on the broadband side to compete with those. So we started shifting towards enterprise. Our expectation is that as early as next year, we'll be crossing over the 50% mark on enterprise revenue. We have had significant progress in an aero, which we had almost no share on three years ago, and now we are only one of the couple of companies in the world that are growing on the aero side.

So there are some progress being made in there. We're happy with that. We still have a long journey to make Hughes much larger scale in the enterprise. We are on the Gartner's leader quadrant as one of the few -- in fact, in this industry, in their industry, in its industry, there is none other than Hughes on the Gartner's leader quadrant. So it shows the ability of Hughes to serve global brands across the world. We'll try to monetize and maximize that if there's any sort of M&A opportunity.

As I mentioned, on the list of areas, domains where we will be looking for additional M&A. You saw three or four of those actually fall within the Hughes purview. That's aero, space. we talked about enterprise services. We talked about defense and domestic manufacturing, which I think all of those are areas where we have green shoots and a good understanding of the trends. And if there's -- at EchoStar Capital, if we find opportunities in any of those domains that would enhance users' position, we'll take advantage of that.

That concludes our call. Thanks for joining. Thanks, everybody.

Good morning. I'm Dean Manson, Chief Legal Officer of EchoStar. And you can see here and those on the web should be able to see the disclaimer for this presentation. I won't read the entire thing, but just to briefly summarize: There will be forward-looking statements in the slides and in the discussion, and you shouldn't place any undue reliance on those forward-looking statements. They are subject to a number of uncertainties and risks most of which can be referenced in our 10-K and 10-Q, which are available publicly.

So with that said, let me introduce our Chief Executive Officer, Hamid Akhavan.

Thank you, Dean. Good morning, everyone. This presentation today was initially intended to be us talking about our satellite system, the new LEO system that we were working on. And obviously, as a result of a number of changes that have happened, we have repurposed that, and we obviously will talk about our overall business.

This was a very quick order. We did not put a lot of effort into making a full picture investor presentation. And this, as Dean mentioned, is not a solicitation for any sort of purchase or sale of EchoStar's securities or equities. But we'll use the time to talk about our business.

I want to start by saying that we were on target to create an incredible platform for EchoStar, both from a based on terrestrial and space infrastructure, which we thought we would be unique in the marketplace and generating a vast amount of growth and value. But in May of this year, we received a letter from FCC that was entirely unexpected. And it questioned our rights to the spectrum and essentially make -- froze our business in a way that really, we would be at the risk of entire -- losing the entire business and really looking at a bankruptcy as potentially the only option ahead.

While we actually had met every obligation that we had committed to the FCC, we respectfully understood that FCC wanted to have our spectrum in the hands of other parties that could, sooner than us, bring it to more efficient use.

This was very difficult for us and forced us to change course and abandon our long-standing business plan and business practice and pivot away from it to something different and very quickly get ourselves geared up for a different mode of operation knowing that, that spectrum is no longer would be accessible to us.

So this was a forced situation for us. We actually had no way forward but to make the most of what we have, which we believe would have been far more value enhancing in the long term. But in the short term, we had to liquidate some of our spectrum to meet the needs of the nation and the FCC.

Based on that, we made a couple of transactions, and I will take the time here to just mention a little bit about that and what that means for us going forward.

The first transaction was an AT&T transaction, where we sold our 600 megahertz of spectrum, which was deployed nationwide and same with our 3.45 gigahertz spectrum, C-band license that we had not yet deployed. Those sold to AT&T, and we believe that AT&T was a great thought leader and very proactive in terms of stepping up and buying unique -- 2 pieces of unique spectrum that in the long run would be critical for the success in the age of AI.

If AI brings a new business brain -- the nervous system for AI is telecommunication and how do you get to the devices and how you get to the end, last mile because all of the processing at AI will be in a center, in data centers, in core of the network. And then you really need to reach the consumers and consumption devices, which will be far larger than it has ever been in the past.

So we think this spectrum will be in the hands of AT&T very valuable for them, and they were very forward-looking in terms of stepping up and buying that spectrum. And as a result of that, we became the first and only today, what we call, a hybrid MNO. I'll talk a little bit more about that when we get to one of the slides that talks about our mobile business.

The second transaction was a transaction with SpaceX. Again, here, our AWS-4 spectrum, our H-block and global spectrum rights, so for S-band rights, where we had, again, as I mentioned, very high hopes to build on our own infrastructure-based direct-to-satellite. We were well on the path of doing that. We actually made a transaction with the SpaceX and sold that spectrum to SpaceX for a sum of $17 billion in -- split in cash and SpaceX's equity, $8.5 billion each and $2 billion additional payments on our behalf towards covering our interest expenses by SpaceX.

And in that regard, we also established a technical and financial arrangement with the SpaceX for our use of their direct-to-satellite or Direct to Cell, as they call it, system benefiting us indirectly at Boost Mobile. So with these 2 transactions, we actually pivoted away from being an infrastructure-heavy, asset-heavy company to an asset-light growth company. We'll talk a little bit about that in terms of our thinking as of now.

So what is the company profile post the transactions? You see here that we still have a great subscriber base in the marketplace. Obviously, the colors are explaining where the subscribers are. It's important to note that when it comes to DISH and Hughes, those are fixed household connections as opposed to individual connections. So when you look at the households, 5.3 million households on DISH. Obviously, if you assume there's 3 or 4 people average living in a household that reaches a significantly number of people.

Also in the Sling, we have not talked about our free stream, which also adds significantly higher number of viewers than listed here. All in all, when you put this together, somewhere in the range of 30 million consumers can be reached using our connectivity and services today, and we are very proud of that diversified base across the brands we have.

Same with revenue. It's a kind of diversified revenue. That shift of revenue is changing, both within -- among the 3 or 4 revenue sources that we have here, but also within the revenue base of Hughes, for instance, that shift is changing from consumer to enterprise and the nature of that revenue changes. The company had $15.5 billion revenue. We still -- we continue to remain a fortune 250 company and very scaled in terms of our operations.

In terms of our ownership of spectrum, we still have a piece -- a portion of our spectrum remains in-house. The 2 transactions that you see here. On the bottom, you see the -- bottom left, you see the AT&T transaction, the pieces of spectrum that we sold to AT&T. In the mid-band of this chart, you will see the AWS-4, our global S-band rights. By the way, for those of you who don't know the terminology, AWS-4 and S-band are synonymous in terms of the spectrums. They both fall in the same band. For us, they were almost the same band globally and within the U.S. In the U.S., it's referred to as AWS-4; the rest of the world, we refer to that as the S-band spectrum rights.

But generally speaking, it's the same spectrum around the globe in addition to the H-block, that was a U.S. PCS band. That's the spectrum that we transactioned with SpaceX. And we still have in-house a portion of the spectrum at the top that we also moved to the pro forma side. We have spectrum on AWS-3 band, and AWS-3 is a piece of a spectrum that is deployed in all of the 3 other major national carriers. It is a very versatile piece of spectrum, probably the most widely deployed piece of a spectrum in the wireless market.

The CBRS, you're familiar with, is an unlicensed and low-power band that also has a licensed and low-power band, which the government is looking to potentially increasing power levels, that's still a debate. And there's a 700 megahertz spectrum that we also have. Not a large piece of spectrum, but low-band piece of spectrum that is also very attractive in terms of its propagation characteristics. So about 45 megahertz of roughly -- I mean, it's hard to put an exact number in there, 45 megahertz of additional spectrum remains in-house. So we still have some assets related to spectrum.

Now if you look at how does that look in terms of financial capital structure. I will first focus on the left side of the page, where we can show what the transaction entitled and what in red remains, in the red-dashed circle. So we had about $4.3 billion cash on balance sheet at the time of transaction from prior debt raise that we had managed in 2024.

The proceeds from the transactions of AT&T and the SpaceX once they close and received will be in the $31.2 billion proceeds. We have a debt repayment of $11.4 billion. We break that down on the next -- to the right side of the page, we'll get to that. And you'll see what remains on a cap structure post this transaction is about $24 billion in pro forma total cash, about $13 billion of total pro forma debt and about $8.5 billion of SpaceX equity that remains on our -- and plus our existing operating businesses, plus the spectrum that I referenced in the prior slide.

Now if you look to the right side of the page, we'll break down the payment of the debt that, as a result of these transactions, will happen.

We started with $26.9 billion worth of total debt in the company. $3.5 billion will be retiring, the 11.75% senior secured due in 2027. That debt was related to our 600 megahertz spectrum. About a $5.5 billion will be paid on a 10.75%, and we'll also pay the converts on a $1.9 billion plus 6.75% senior. These were related to the liens we had both on the 3.45 and the lean that we have had on AWS-4.

So once we pay those obligations down, to free up the spectrum that we have sold, what remains is on the right side of the page. We put that in a color coding in 2 different colors because that debt is in each of the entities that are listed here. So the $1.5 billion of obligations will be in Hughes, in EchoStar legacy or HSSC and about $11.9 billion of debt remains in DISH DBS. And at the parent level, we will not carry any obligations at the EchoStar level. So this is the new cap structure for the company pro forma post transactions, once the transactions close.

Let me talk a little bit about the business units and any impact there maybe on the business units going forward.

So we do have several brands that we market ourselves. EchoStar will not be our marketing brand for any of our products. We continue to remain -- keep EchoStar as the holding company brand and go to market under each one of the individual brands as we serve different segments in the marketplace.

Let's talk about Boost. We boost we're in the midst of a transition of this brand to becoming a very innovative, challenger, younger brand with very innovative distribution systems and very much focused on technology innovation and taking advantage of the trends in the AI and being unencumbered by any legacy infrastructure, relying on the most advanced telecommunication infrastructure anybody had ever built.

Now that is no longer the case from an infrastructure perspective, but you will see that we are actually keeping all of that advantage going forward using AT&T's infrastructure and SpaceX's infrastructure. Again, very unfortunate that we could not own that infrastructure ourselves, which would have been even more value-enhancing in the future, but this was not something that we could maintain, as I explained already.

So Boost, we have great hopes for Boost. Boost will be a challenger brand in the marketplace. Boost will be a differentiated brand by many aspects in terms of its presence in the marketplace, in terms of its technology. We are committed to remaining very focused on being a disruptive player in the marketplace on Boost.

Let me talk about our mobile business more and talk about SpaceX related to our business. First of all, we think that SpaceX is the undisputed leader in the marketplace in terms of connectivity for Internet today using Starlink. What we delivered to them in terms of a spectrum will enable them to also become very effective and potentially repeating that in Direct to Cell environment, as we had planned on ourselves.

SpaceX is highly integrated vertically. So their time to market, their cost structure and economics that they have are superior to other satellite solutions out there. They're very agile in terms of their approach. I mean they have -- obviously, I don't need to talk more about this, this audience is very familiar with the SpaceX. They've brought a fail fast mentality to the satellite, that's a software mentality as opposed to the traditional satellite mentality of never fail, which usually is a slower and is more expensive and you have to be vertically oriented to be able to take advantage of that and SpaceX is doing that.

And the reason we're talking about that here a bit at length is because we do stand to benefit from -- indirectly from SpaceX's use of this spectrum, first, in terms of Boost, in terms of our mobile business, where which we do expect to have to offer the products that SpaceX will bring to market and Direct to Cell using Boost and offer it to our Boost customers and also we benefit indirectly from owning a small piece of the SpaceX's equity.

As it comes to AT&T. Here's what I want to talk a little bit more about hybrid MNO, and this is something that we have coined that phrase, and there's no such a phrase in the marketplace because nobody else has done it to the level we have done in the past. So we -- prior to this transaction, we were, and even as of today, we are still a complete carrier in terms of all of our systems.

So the core network, our core network is cloud-based, is incredibly modern, it doesn't have any legacy and it connects to our radios in the cell towers we have, the radio plant. We also have a modern, very powerful, state-of-the-art IT systems related to our core, which our BSS and OSS, as they're called, they are very modern, free of legacy, which allows us to be very quick in terms of innovation, bringing new products to market, creating dynamic responses and dynamic offers in the marketplace.

We are going to keep all of that. None of that is going to be lost. The only thing that we are essentially giving up is our own radios, antennas in the marketplace. We will connect to AT&T's radios, but we keep all of that infrastructure that made us a very agile, fast and unique carrier, that remains in-house.

We will not be encumbered by any other carrier's systems, either in core or IT systems. And so -- this is what we are very happy about in terms of being able to be that challenger in the marketplace, not just by cost structure and not just by having a fundamental radio system that would be different than anybody else, but because we also have the ability to create on our own and respond to the customer needs in a differentiated way. We believe in the age of AI, there is going to be huge need for new products and new services to be offered whether to enterprises or consumers, and I think we are well positioned to do that.

That was always our aspiration to do it. We thought we could do it on our own in even a more effective way, more value-enhancing way. But now we kept the best of what we could using AT&T's infrastructure. So see us develop Boost, and we are committed to remaining in this marketplace even more aggressively than we have ever been in terms of competition and in terms of our offerings in the marketplace.

Nothing in AT&T's deal prevents us, slows us down or limits us from being that effective competitor. So we are very proud of the agreement we made with AT&T, and it was great for AT&T to try to help us find a win-win solution that met the FCC's requirements, met the best interest of the consumers, but also kept us in a marketplace in a very aggressive way without any limitations to grow and compete.

So to summarize our Boost business: We will keep our mobile core, which is uniquely differentiated. We use AT&T's infrastructure, and now the AT&T has bought great amount of low-band and mid-band spectrum, which I think that is critical for the success in the AI age. AT&T's network will very quickly become even more powerful. I mean they can turn on the 3.45 gigahertz of spectrum "overnight," simply because the radios they have today, the planted -- the technology they have deployed today is compatible with what we sold them. So this would be a very quick enhancement in capacity and quality of coverage for AT&T.

On top of that, we also have the same connectivity, the same core network, the same IT systems will also use to connect to a SpaceX's system for a direct-to-satellite allowing us to marry the space to ground connectivity in the most effective way anybody can. And so watch us take advantage of that and hopefully be the most unique differentiated offering around the world for Boost subscribers.

As it comes to our DISH and Sling. I have to tell you that the most pioneering company in the video services distribution has been DISH, and there's very little doubt about that what Charlie Ergen and DISH and his creation has done to the marketplace. To this day, many of the things we have are owed to him and his creativity and his innovation and his creation, and we continue to play in that space.

As evidenced by the fact that if you look at sort of the pandemic window where nobody had an option to move anywhere else and they were all locked up in house, excluding that window, we have the highest loyalty, as evidenced by the lowest churn at DISH, historically lowest level of churn.

Let's turn it the other way, historically highest loyalty for the consumer base that we have in DISH. And this is all owed to a fantastic experience. It's more than anything else that everybody has an option, more than 50%, 60% of our existing base has broadband connectivity. So our DISH consumers and customers have broadband connectivity, and they continue to use the satellite connectivity we offer them because the experience is unparalleled.

And I can tell you my own experience, having used everybody else's speaks to that. We have increased viewership, both for Sling and DISH, 8% year-on-year for DISH and that's a very large, 18% year-on-year for Sling in days that there's so many other distractions and ways for people to get their content, especially if they have broadband, just the viewership going up 8% year-on-year for DISH and 18% for Sling, it's incredible.

And we have a very large base of loyal free stream Sling users, significantly larger than the paid. And that base, both feeds our pre to paid and also feeds our media sales. So free stream is also a big part of our business. And Sling continuously gets rated as one of the best streaming services out there, a combination of what the content is, innovation on the content and also the user experience is really sticky, and we have a dedicated team of developers that will continue to develop for both of those brands.

When it comes to Hughes. Hughes is a smallest segment in our business unit, but it has punches way above its weight in terms of recognition in the marketplace and is in transition to become a larger enterprise company. Three years ago, we started heading towards repositioning Hughes more towards enterprise as satellite connectivity to consumers was becoming more crowded. We anticipated and also saw subsequently that Starlink came to market, we think Kuiper is going to be in a market, there may be others in the market in terms of consumer, but I think there is an incredible amount of demand in the enterprise, not just satellite connectivity, but what we are focused on is resilient connectivity and that's a combination of satellite and terrestrial.

And one of the things that we really focus on is making sure that we marry all sorts of different ways to give the customers what they need, both in terms of combination cost and perseverance, which is resonating very well with mission-critical industries and governments. And I will talk about a couple of those very briefly here.

Just to highlight one of the areas we have made significant progress on the enterprise side in the past 2 years has been our Aero business. We have already announced a couple of different airlines. You know about Delta Airlines, you know about Turkish airjet. We have a couple of other airlines that we are very optimistic about -- hopefully making an announcement soon about having agreements with them, putting us in a very good position of scale in terms of our Aero business.

We're already looking at $1.8 billion worth of backlog in sales in the Aero side. Our uniqueness in the Aero is that we have brought a future-proof solution to the airlines, where airlines have the ability in a combination of K and Ku-band connectivity, source their connectivity from multiple different providers, not just on entry, but also over time as our system will remain compatible with a number of providers of LEO and GEO systems.

And so not only today, but in the future, the airlines can shop around, have the flexibility to buy from different suppliers and mix and match, combination of LEO and GEO. Nobody else does that. Today, nobody else does that. And that resonates very well with the airline industry. And this flexibility that we offer to the airlines has been the draw. And hopefully, we'll have additional airlines to announce. But much of that is also attributable to the antenna technologies that we have developed, what we call an ESA, electronically steered antennas, that are highly powerful in terms of performance and cost and value.

We're not as large player in the military, but given our heritage of delivering robust and now more than ever resilient telecommunication connections, this is resonating very well with the governments and Department of Defense, so we do expect that going forward Hughes will be also seeing much more growth in there in terms of software-defined engineering for resilient telecommunication systems.

So what is the EchoStar's future direction? And here, I only limit this to one slide. I think, first of all, we are in transition. This is very quick, post the announcements we have made. We probably would not have had this presentation today had it not been prescheduled, and we had the opportunity to be here. We didn't want to miss the opportunity to at least be on the stage and explain what we have done. So please consider this all in work in progress, but we thought it would be great to give you a very first glimpse of our thinking today. In the Q&A session, we'll try to address any questions you might have related to this.

But first of all, we are going to be an asset-light growth company. That's the force pivot that we had to make by disposing our spectrum that which we had not planned on selling at this time. We thought over time, that could be a more value-enhancing infrastructure for us, but much more than what we have managed to get today, but I explained that already.

We're focused on risk balance, asymmetrically positive on the return side. We definitely we'll look for a total shareholder return as the picture. We're going to have emphasis on connectivity and communication, that's been the core alley and runway that for the past 40 years, the company has built revolutionary and disruptive businesses on. We won't give up any of that heritage. But we do -- we'll expand on that.

So you will see us expand our aperture, now that we have additional capital at hand and additional opportunities to deploy our resources, would -- you see an -- you should hope to see an expansion of that if we are successful in implementing the strategy we're talking about here.

Diversified -- our focus is always a diversified portfolio of platforms. We are platform thinkers, not point thinkers, wanting to expand on a thesis. Very much a longer-term view company. We're not day traders, and we're not looking at up and downs that happen in the marketplace on a regular basis. We're looking at the long-term thesis in very results-driven the company.

We obviously an operating company with a mantra and mission to make sure that we remain efficient. And more than anything else in deploying our capital, we are very much focused on downside protection and preserving the capital.

Having an ownership mindset, most private equities and investors and operating companies talk about the mentality of ownership, but none ever can be more than here where we have a founder that actually owns more than -- much more of equity than anybody else out there. So very much a ownership mindset with downside protection.

Now some of the benefits of our company that we'd like to make sure we maintain and capitalize on is that we have a very long 45-year institutional heritage and knowledge that we're very proud of. I mentioned that we're going to keep that. That is one of our unique assets and differentiations. The people in our business who deployed the first O-RAN technology in a way that nobody else has done in the world, we're not losing that capability. We're not losing the knowledge and institutional learning that we have had.

On the mobile side of the business, we're not losing that. We're keeping all that talent, the core talent for technology there. Obviously, the content business, I think the company has written the rules for the content business practically, we've very much stayed in there. So that experience will remain with us. The scale of a Fortune 250 company stays with us.

We will have enough resources to make sure everything is properly fed and developed. And we have the flexibility of being a public company. So accessing our portfolio, individual company that we have, whether you'd like a piece of Hughes, whether you like DISH and the content business we have, whether you like to participate in our Boost trajectory and any of the assets associated with it, we remain -- as a public company, this is something that is available to the marketplace. We think that's also an advantage that gives us flexibility to move and make transactions happen as necessary.

I want to stop here because I want to make sure that we have time for Q&A. I would like to ask Charlie Ergen, our Founder and patriarch to join me for Q&A. Charlie, if you don't mind joining us. Thank you.

Charlie just landed like an hour ago, and so -- coming from U.S., so please give him a bit of a slack in terms of his -- if he's...

So let's take questions.

Let's take the questions.

Go ahead. Right here. We'll repeat the question. So...

Okay. I guess, a combined question for both of you. In August, you sell -- you get -- in May, you get the letter from the FCC saying, use it or lose it. In August, you sell a bunch to AT&T. And then in September, you sell another chunk of spectrum to SpaceX. And you tied, if I'm misstating what you said, both of those would do the FCC.

So my question was, even at the AT&T transaction, even after you've signed a $1.3 billion contract to use your S-band, you still thought it was the FCC pressure that would force you to do that? Or did you go back to what you said, Charlie, 2 years ago, which is the following thing: What you don't want to do is compete with richest guy in the world who has got unlimited access to capital. You'll lose that competition every time even if you got better technology." Sounds like that's still your view and that might have also informed your decision with SpaceX.

Yes. There's a lot to unpack there. The -- we'll start with the beginning. In May, when we got our letter, we don't believe the FCC could do what they said in the letter. So that's never happened, but we would win the battle, lose the war because we were frozen at that point in time. So how do you build a network? How do you get a return to shareholders when you're not -- when you don't know how long the proceedings will take in court to solve that.

So you -- I was [indiscernible] started business because when you played blackjack, you play the odds, and every hand, there's a right-wrong answer, that wasn't so dissimilar here, where the hand that we're dealt by the FCC was one that there's only one logical path that we're going to be able to take.

So what was interesting about AT&T was, and of course, all of them, there were many number of companies that looked at the spectrum, but what's interesting about AT&T was because we already had moved to this hybrid MVNO and the fact that Hamid mentioned, we're going to be able to use the spectrum that they bought to compete against the other guys, that was really an ideal situation for us.

And hybrid MVNOs, you're going to see a lot more of heavy capital-intensive industries where that capital gets shared with many users. You'll see it in fiber today, the private equity companies are buying fiber and they get an anchor tenant and they'll sell it to -- they'll make sure as many people ride on that as they can because you've got -- where you've got unlimited capacity, that's what you want to do.

So we're in a situation now where we're way more competitive from a Boost than we've ever been because we didn't have scale. And so without scale, the cost of running the network was going to be -- was going to take a long time. So -- and the fact the key to a network, which is the brains of the network, the thing that's different about us, we thought Open RAN would be the big difference, but it turned out it was cloud. And it turns that Open RAN really hasn't moved as fast as possible. And that cost is now being borne by a partner in AT&T, not by us.

So we get the flexibility of doing things in the cloud. Artificial intelligence is going to make a big difference. You're going to have to be in the cloud to do that. And so we're well positioned to compete in that area. And then with space, we actually went to SpaceX, I think, about 8 years ago to get them to build this for us, and they declined to do that.

And I think the relationship that SpaceX had with the government was one that they just weren't interested in buying spectrum. That changed a bit and once we get a fair price for the -- and we were excited about going on our own to build it because we designed a really good system. But it certainly wasn't going to be in the scale that SpaceX could do. So they have been a vendor for us for a long time, they've been one of the best vendors I've experienced within 45 years.

They did incredible -- they've done incredible engineering stuff for us in terms of launches and changing things at the last minute. And what was interesting, and I think one of the things that was most interesting was we're also -- now that we're going to be cash rich and asset light, one of the first investments of SpaceX and if for the -- all the things that I see in the world today, if I can make one investment other than ourselves, it would be SpaceX because they've got 90% of the launch capability in the world today or 90% -- and I think that lead will grow with Starship, and they have a manufacturing capability that's highly automated, is built from the ground floor up.

So it's -- they don't use aero -- they don't always use aerospace parts. They don't have a different -- they have a different way of thinking and so they can adapt. And so I think -- and then again -- and then because they have broadband business already at high frequency and inter-satellite links, I think -- I don't want to speak for them, but I think where people will see they'll go are places people haven't been thinking about. So we were going to try to interface with them anyway. So that just became a natural, once they were willing to pay a market price for the spectrum.

I'll add to that by saying, once you sold a good piece of your spectrum, it doesn't matter whether you first sold AWS-4 to SpaceX. When we sold the 600 megahertz to AT&T, we no longer had a network because both of those pieces of the spectrum were actually used in our network. So based of our network was 600 megahertz, the low band and the capacity driver was the AWS-4, the mid-band.

If you transacted on either one of those pieces of the spectrum, you were forced to do the second transaction. And also, once you're in this business, in mobile business points, you start losing a critical mass of a spectrum even if you sell some, you will become subcritical in terms of -- we just talked about how important the spectrum is, but your ownership of spectrum drops down to the point where in the longer term, you're no longer competitive.

So what -- any piece of a spectrum that we were forced to dispose would automatically snowball effect of making sure that we can no longer maintain a critical mass of spectrum ownership to be a viable player. We did the best we could. I mean this was a forced hand, but obviously, Charlie and I spent a lot of time thinking about what is in the best in the interest of everyone and respectfully accepted FCC's desire to make sure this spectrum ends up in other hands that can more quickly bring it to more people. So this was -- we made the best we could do. And as Charlie said, we could do better on our own, but that's a different topic.

There was -- Ric, maybe you can take it, Ric. Ric, usually is the first guy asking questions. Let's see what he has to say.

I got in today like Charlie got in today.

Always, Ric. Go ahead.

Yes. Charlie, at the Investor Day several years back in Vegas, you had some aspirational goals about how big Boost could become. So when we think about an MVNO strategy, a hybrid MVNO strategy, the relationship with SpaceX Starlink, first question is, what are those aspirational thoughts about what Boost could be? Hamid, you said you're committed to Boost.

Yes. The aspiration goals for Boost are exactly the same. I think it's path is a little bit easier for 2 reasons. One is, we actually know what we're doing now. So we were the most ignorant people in wireless 4, 5 years ago, for sure. And we've learned a lot of hard lessons and -- but through that, you keep learning and you keep getting better and you keep practicing and we've been doing that.

And the second thing, obviously, we'll have capital. So the aspirational goals for Boost still I think it's going to be a good growth business for us in ways that you certainly haven't seen yet.

And then a detailed question back on the pro forma. You mentioned $24 billion cash pro forma, $15 billion debt pro forma. What are the tax implications of the transactions? And does that also then assume -- I think the tower rent maybe is $4 billion ballpark legacy life out there. So is that all reflected into that?

It's very -- again, this is happening, we are still only days away from these transactions. And tax guys usually and other guys will need much longer time to tell you the answer to your question. I would love to know the answer to those myself as well. We certainly deal with whatever obligations we have, looking at the options we have and looking at what the tax calculations are.

There's a wide range is in the marketplace somewhere, I don't know, $5 billion to $10 billion worth of calculations that other people have done. We have not done that calculation in detail, but there's a wide range out there. In time, we'll -- once we get our arms around it, we're happy to share. But again, you cannot handicap it to any narrow range. Some people have talked about $15 billion or $5 billion to $15 billion, but somewhere in that range when you talk about everything that we have to settle is not...

Let me tell you the ranges, I've said. I don't want to -- it's a critical question. So tax and liabilities as we take down our network, right, is you've seen ranges from $7 billion to $10 billion of what that would cost us, okay? And then when you look at the spectrum that's still in our balance sheet, well, I've seen ranges from $5 billion to $15 billion, right? So that'll give you a feel for it.

I think we have a feel for where we think it might go, and we got to go work with our -- we've got to work with their vendors and work the people help us build the network, and we want to do that upfront and have that relationship and continue. And then tax is tax and it's up to accountants to figure that out. But we will have -- we do have tax losses and it will cost some money to take down the network. So that's all going to be part of the tax stuff. And the tax rules are pretty favorable at this point.

I think the key is where do you end up with it. We're going to end up with a significant amount of cash, with significant investment on the balance sheet in terms of spectrum and SpaceX to start with. And -- so it's -- before I answer -- we answer [ Fred's ] question, I guess I would say it's about the fourth pivot for me personally as a company.

And every time we pivoted, we -- it was always a little scary at first, and it was always sometimes not so -- we weren't so necessarily happy about it. Scrambling happened, we were a $250 million company in 1 day; next day, scrambling happened, we were 0 company. We were 0. We went from $250 million to 0. So that wasn't so fun.

But as management, we went in and we were prepared. We read the future, we read the tea leaves, we were prepared for the things that were going to happen, we were prepared for scrambling and we were building integrated receiver scramblers. And when we did that, we became a $1 billion company.

As soon as -- and our competition who didn't see those things coming, you went out of -- we had 200 competitors before scrambling. After scrambling, we were it. So this pivot is the same thing for us, not personally exactly where we want to go, but we're also then excited about how do we see if we're good enough to pivot to something that we'd never had before, which is having a lot of cash and what you do in a world that's changing really rapidly. But we have some wisdom that maybe some companies don't have today, right? We're not as smart, but we've got a little bit of wisdom.

And Hamid comes from our private equity background. So -- as well as being an engineer as well being the telco business. So he already knows a lot about the private equity world. I'm not that good at that. I'm an investor in people. And so you give me a good company or a good person, I'll take a good person every time, every time.

So I think we're in -- I think we have a really good shot of being pretty good in terms of how we build our business from here with a different set without the cloud of uncertainty, without the pressure of those things and without having to get IR people go talk to The Street, which is what everybody wanted us to do, we're just going to go run our business like we always have, think long term, right, and try to do some things different than other people do. I know that didn't quite answer...

[ Fred ]?

Congratulations to you both. I guess you're now the $42 million man. Right now, capital is this strategic and a scarcer commodity across the AI communications and infrastructure sectors. It's been in a long time in my career. You all are going to be very cash-rich coming out of all this. And I mean is there some expectation that over time you might evolve to look a little bit more like either a SoftBank or the Advance Newhouse diversified investment across some of the expertise of some of that capital or how are you thinking about...

I'm going to take a quick thing and then I'm going to get to Hamid because he's probably better to answer it. We historically have been builders, so I expect we're going to -- I think our core is we want to be builders of things. But we have dipped in -- we did come very close to acquiring SiriusXM, and we came close to acquiring some other companies.

So we have been in that -- we've done pretty well at that and we've been in that situation where we've been investors in things. But at our core, we're builders. I think there's going to be a lot of storm clouds in the horizon for companies who were like EchoStar. They were asset-rich and cash-poor. So I think there's going to be some storm clouds there. Interest rates -- certainly long-term interest rates probably don't come down soon. So maybe Hamid you...

Yes. Thank you. Look, [ Fred ], we are very excited. Again, this is -- this wasn't on our plan. But as it happens, we find ourselves in a position where we could be uniquely positioned to be a significant player. I wouldn't want to compare ourselves to SoftBank. That's in a different level and a different league. But we are much more strategic in terms of owning, having run businesses ourselves. Charlie and I have been operating businesses since birth practically both of us.

So on to private equity, having been an operator for many, many years, when I went to private equity, I had a different way of looking at opportunities and looking on the surface and see what the trends are and how it's going to work as opposed to running a number of spreadsheets and trying to remain at that.

So I think we're going to keep that institutional knowledge that we have had, adding the experience of private equity and experience of investing that both Charlie and I have had in the past on the top of that, going to be great stewards of capital, we're going to be asymmetrically betting on positive return relative to the risk.

We are definitely going to be a long players in terms of vision and horizon. We're not going to go with that very quick return type of mentality that some of the other equity firms have. We're not going to be like that. But again, the one thing that helps us here is that, first of all, we don't have to pay the 220 private equity, just kidding aside on that one.

It's also we're a public company. And usually, companies that are very diversified in terms of having a different set of operations and I would say, almost looking like a private equity, we're definitely not a private equity, so that's clear. But looking like that, being public is a huge advantage because that's flexibility for coming in and going out and people don't have to put money in a 10-year fund and wait 8 years to get the return. Here, obviously, the fluid flexibility of being a public company is something that usually happens in much, much larger scale than an investment firm of small or midsize, you know that.

There's very few of those in the marketplace, especially one that is not so large that would be daunting to invest into. So -- but Charlie and I looking at all of that as a whole and saying, "Look, this was not the hand we started with," but as Charlie said on fourth pivot, we are in a position we definitively see a horizon and aperture that is wider than we have had in the past rather than narrower by the nature of things.

Question here, yes.

I was intrigued by your statement that the best investment you can make beyond yourself was SpaceX is a single best investment out there. Does that mean that given the financials are not needed to liquidate any SpaceX, it would be more of a permanent investment? And if you had the opportunity to increase your SpaceX investment through excess cash -- using excess cash to buy back EchoStar shares in the market, is that something you would consider? Or is SpaceX a transactional investment we're you would liquidate it somewhere down the road and transition the money into some other investment?

Well, it would be really hard to say. I mean we certainly invest more in space today at the price we bought into SpaceX. But it's just rare that there's -- they have a huge moat around what they do and space isn't going away, and they're very diverse between consumer and government in terms of customers. And when you see things like potentially Golden Dome and things like that, I mean they have to go rescue our astronauts, right? They're the only guys that can do it. They're the only company that can launch men for the United States.

So they're just in a very unique position. And our spectrum, they paid us $17 billion. They're going to make way much more money. So look at our spectrum position that we've built over 15 years. We have the highest ITU rights. This isn't -- so that means nobody can interfere with SpaceX in this frequency. So this is 40 megahertz around the globe that nobody can interfere with SpaceX.

Second thing is we have an exclusive for this spectrum in the United States and the FCC just reaffirmed that, right? They -- so that means that anybody else who does a LEO system, because you go around the world, no country -- every country in LEO is an island by itself, but you just can't get the economics, in my opinion.

You're not -- it's a Western country, you're not going to get China. And if you don't have the United States and this frequency, it's going to be very difficult. Now there's other frequencies, right? So other companies here have L-band and others, there'll be competition coming from other frequencies. But when you read a lot of hype about the S-band, it's really, from a practical manner, I don't see anybody else building the fleet of satellites in that frequency just because the United States is off limit and you can't interfere with SpaceX and SpaceX will build -- I imagine will build thousands of satellites, it's for them to say, I don't know. But I imagine they'll build thousands of satellites.

And then they have the ability to combine broadband satellites and handsets. So that means that if you think about what they're able to do, they'll be able to go to your home, but they're also going to be able to go to the phone in your pocket and they can marry all those together. And if you really think about what that means, it's a big moat. So that's why I'm bullish.

It doesn't mean I'm right. And then our -- as a steward of capital, and as management, it's our charter to go out and say, how do we get return to investors better than just paying a dividend. So that -- you never say never, you just -- you try to go get a better return than that. And then one never knows. I mean the world changes pretty fast, but they're -- I don't know if anybody can launch every 3 times a week. I don't know anybody who can build 7 satellites a day.

I don't know anybody who's got a rocket that's 4 times bigger that you can actually catch it, that you can probably eventually launch the next day, catch it and launch the next day. I mean, that's beyond my imagination. And that's why I say you invest in people, but people don't realize about the greatest skill set that Elon has is build teams, he just has extraordinary teams.

Okay. Time, maybe 1 or 2 more questions. One over there.

The question is about actually the Hughes. So in your presentation, you mentioned that you would like to convert your Hughes unit more into enterprise focused, right? Well, currently, you have more than 1 million subscribers on JUPITER and they are mainly residential consumers, residential users. And you also mentioned that Starlink is a leader in terms of broadband connectivity. So do you expect any maybe expansion of your cooperation with Starlink on that or it's a bit separate thing?

Right. Look, Hughes has been in a midst of a transformation or a pivot that you may want to call it, 3 years ago, we noticed that the consumer business connectivity is going to be a declining business for us. The reason for that is not just from a space, which obviously, we saw LEOs coming in and then we had a GEO and it's very difficult to compete with the LEO, which provides a lower latency, potentially better economics in the long term.

We saw a Starlink come in, we saw Kuiper potentially come in and others. We kind of saw that and decided that we would reduce our emphasis. And so again, goes to forward looking, making sure we take asymmetric bets on risk. We decided that we need to expand our approach to enterprise. Today, I can tell you that very soon, if not now, we are almost over the 50% line on revenue on the enterprise side. So we have already -- so within a couple of 3 years, you will consider us primarily an enterprise company.

And we'll serve the consumer greatly as long as it comes. And the other challenge is that the terrestrial coverage is also expanding on wireless. Now people are buying mid-band spectrum, AT&T has bought. T-Mobile, one of the fastest and growing and same with AT&T, one of the fastest-growing revenue base and customer base is fixed wireless, and that is encroaching towards satellite connectivity.

Net of it is that Hughes will become a larger enterprise company over time. I highlighted a couple of the areas that we already have good progress in or expect to make good progress in. There's more areas that are in highlight. So we love that brand. I think it's a great company. We need to develop it. And now we have the capital to potentially make even bigger steps on Hughes.

There was a question. Adam, I apologize, he raised his hand, and I'll go with you next. Adam, go ahead, please.

How should we think about the monetization of the remaining spectrum assets [indiscernible] and then following off of that [indiscernible]?

I'll try to take that one. Yes. So we sold about 2/3 of our spectrum. We have about 1/3 of it left. We have some millimeter wave spectrum as well. So we'll have investment in spectrum because it's a limited resource. From a fundamental thing, it's a limited resource that they're not making any more of.

And it's a Bitcoin-ish in that way, but it's also got a utility, whereas Bitcoin does not. So we think that spectrum continues to go up in value. And so as you -- as we work with the FCC in terms of the flexibility we all have, we're working with the FCC to make sure we have a lot of flexibility with the spectrum that we continue to have. And that will be the first step is what flexibility do we have?

AWS-3, which, there's 2 things. One is an auction that will happen sometime next year, but it's required by the Senate, so we'll get a feel for that. But AWS-3 is an unique spectrum and all 3 of the big carriers own AWS-1 and AWS-3. So it's the same band. It's on band 66. So when you think about AWS-3, you got to think about AWS-1 as well.

All 3 of the carriers have it. Two of the carriers are always adjacent to where we have it. For the most part, their radios can handle the spectrum. So for investors, this is a nuance, but people didn't think of it originally this way, but the way we've always thought about it, we think of the value of the spectrum and the cost to deploy it and you put those 2 things together.

So if you don't -- if there's no cost to deploy it, which -- that's why AT&T wanted our 3.45. They already have radios up and running. So then the FCC was really happy because within 60 days, they're deploying our spectrum that we were going to be years away from. But they don't have to deploy any radios for that. So it makes the spectrum more -- it means that the value -- more of the money goes to the spectrum than to the -- normally, it's about half to deploy and about half of the spectrum.

So AWS-3 falls in that category in the sense that it's, for the most part already deployed by the -- for the radio. So I think it has great utility. But -- and I like CBRS because of its ability to do some interesting things. It's basically licensed to Wi-Fi or hybrid Wi-Fi. So I think there's some -- so I think we still have a good spectrum position that will maintain value, and the key will be the flexibility and how long we have to work with them.

And what was the other part of the question?

About 12 gigahertz...

12 gigahertz is part of that. I'm not as optimistic about 12 gigahertz in the sense that SpaceX uses it, so we can use it without interfering. And so now that we're working with them, maybe they'll look at that more objectively, but we'll see. But I do think that there are things that SpaceX is going to do where we're a bit more on the inside.

And the fundamental things they're going to be able to do, there's going to be a lot of offshoots so the -- there'll be a lot of offshoot businesses from what they do. And you see it a little bit today. My son and I went to Africa, we took a little mini SpaceX thing and somebody sold us a battery and the way -- and a little kit that fits in there.

Well, that person is going to have a pretty nice little business because it's very innovative, very, very neat the way the person did that. So there's going to be a lot of businesses that offshoot of SpaceX. I didn't even mention IoT, but you're going to be able to track an awful lot of things in there. And they're not going to do all that, it's just -- it's going to be too small for them. So we're just in a good spot.

Let's take a final question. There was a question over there, I skipped. Go ahead.

Yes. So just -- I mean, you were close on DISH DIRECTV last year. So just curious how you're thinking about that? Is there another go around there? And then also just how does maybe Connect play into all of this? Could that be sort of a pure-play of just SpaceX stock in the public markets?

Yes. So I'll take that. Look, at this point, I'm not going to make a comment about any next move. But broadly, we said, we are going to take a look at every opportunity that is out there. And DISH is a company that we have a lot of emotions about and we love and we think we're going to look at that and see what next moves are possible for DISH in terms of us developing further into it.

If there's an opportunity to do something with DIRECTV, we'll always explore it. Last year, we tried that. It didn't work out. There was a lot of challenges by the bondholders, and I think they should not have resisted that. But at the end of the day, looking at our every business unit with the lens of what we can do to maximize the value of that platform, it is the focus going forward. It has always been there, but now we have more flexibility, freedom and resources to structure those investments differently.

So we're going to take a look at it with a different lens. It's too early for me to give you any indication of what we're going to do. But I can tell you that we love our children and all these -- all of the investment companies now and in the future will be handcrafted and closely developed under the lens of Charlie and myself.

I think this was probably all the time we had. I want to thank you all for your attention. Hopefully, we'll have another session with more details in the future when we have a more clarity around where we're going.

Thank you very much.

Thank you.

Greetings. Welcome to the EchoStar Corporation Second Quarter 2025 Earnings Conference Call.

[Operator Instructions]

Please note that this conference is being recorded. At this time, I'll now turn the conference over to Dean Manson, Chief Legal Officer. Dean, you may begin.

Thank you, and welcome to EchoStar's Second Quarter 2025 Earnings Call. We will begin with opening remarks from Hamid Akhavan, President and CEO; followed by Paul Orban, EVP and Principal Financial Officer; and John Swieringa, President of Technology and COO. We request that any participant producing a report not identify other participants or their firms in such reports. We also do not allow audio recording, which we ask that you respect.

All statements we make during this call other than statements of historical fact, constitute forward-looking statements made pursuant to the safe harbor provided by the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause our actual results to be materially different from historical results and from any future results expressed or implied by the forward-looking statements.

For a list of those factors and risks, please refer to our annual report on Form 10-Q, the quarterly report on Form 10-Q for the quarter ended June 30, 2025 filed today, August 1, and our subsequent filings made with the SEC. This information and supplemental materials related to today's call will be posted on our Investor Relations website. All cautionary statements we make during the call should be understood as being applicable to any forward-looking statements we make wherever they appear. You should carefully consider the risks described in our reports and should not place any undue reliance on any forward-looking statements. We assume no responsibility for updating any forward-looking statements. We refer to OIBDA and free cash flow during this call. The comparable GAAP measure and a reconciliation for OIBDA is presented in our earnings release and in the case of free cash flow in our 10-Q.

With that, I'll turn it over to Hamid.

Thank you, Dean. Welcome, everyone. Thank you for joining us today. I would like to address a few notable items from the second quarter as well as an additional recent development. As we have said in our SEC filings on May 9, the FCC informed us that it had begun a review of our spectrum licenses. This includes a review of certain obligations to provide 5G broadband service the September 2024 build-out extension granted by the FCC and our exclusive rights to the AWS-4 band. This event and the inquiries it introduced have led to considerable amount of uncertainty over our spectrum rights. It has effectively frozen our ability to make decisions about our 5G terrestrial network, build-out has materially impacted our ability to implement and adjust our overall business plan and has required us to reevaluate the deployment of our resources.

As a result of the FCC's inquiry, we chose to delay several of our scheduled interest payments. We submitted detailed responses in the various public proceedings the agency launched back in May. As explained in our responses, we strongly disagree with the factual and legal basis of the FCC's inquiries. On June 11, our Chairman met with FCC Chairman [indiscernible] and explain how the FCC's actions threaten our viability.

Following this meeting, President Trump encouraged the parties involved to reach a positive resolution. Due to the nature of our ongoing discussions with the FCC, government and other entities, we chose to make our delayed interest payments within the permissible grace periods. In addition, today, we made the due payments for our HSSC bonds. Since then, we have had numerous collaborative conversations with the FCC, the administration and various parties to try and reach a constructive solution that is beneficial to EchoStar and consumers while also addressing the FCC's wishes and fastest U.S. leadership in telecom.

It is our highest priority and a huge focus of the leadership team, including myself, but given the ongoing nature of this issue, I can't say more or get into any specifics today. The commitment to secure in our future and promoting U.S. leadership in the global communications industry is a top priority. An exciting step towards that goal, we have announced an agreement with MDA space for them to be the prime contractor for our new LEO direct-to-device or D2D satellite constellation.

This new constellation will enable EchoStar to provide global wideband services directly to standard 5G MTN devices such as popular Android and Apple and other compatible IoT products and help foster U.S. leadership in D2D connectivity and the space economy. The constellation is enabled by our global [indiscernible] spectrum rights, which includes exclusive U.S. rights for AWS-4 along with the 30 megahertz of S-band 2 gigahertz MSS rights in Europe and similar magnitude of spectrum around the world. These spectrum rights, our technological leadership and our strong service delivery capabilities will allow us to provide the dedicated capacity and security services that are in demand by consumer, enterprise, public safety and government sectors within the U.S., Europe and the rest of the world.

Since 2012, EchoStar has invested well over $13 billion in the S-band, beginning with the acquisition of 2 of the original MSS operators, DBSD and TerraStar, who held S-band FCC licenses as well as 3 geostationary satellites, which are in operation today. We also led the efforts to include the S-band in the 3GPP standard to allow for satellite compatibility with off-the-shelf handsets. EchoStar's total investment includes the acquisition, integration, deployment and operation of the AWS-4 band as part of its 5G Open RAN network in the U.S. EchoStar's new LEO constellation will utilize up to 25 by 20 megahertz of AWS-4/S-band spectrum. And we will be fully compliant with the newly created NTN and 3GPP standards, allowing EchoStar to provide messaging, voice, broadband data and video services offer of launch to all devices with the current 3GPP NTN specification without modification. This is true 5G mobility. This wideband service is a fundamental improvement over the existing satellite messaging and SOS services.

Launch of the satellites is planned for 2028 with commercial services starting in 2029. Initial configuration of the system consists of 200 satellites rapidly growing from there to provide continuous growth of capacity globally. Peak funding of the project is estimated to cost $5 billion, which will be self-funded by EchoStar. As we said, when we merge EchoStar and DISH in 2024, a key goal was to unite the spectrum and technological assets across both companies to realize our vision of a global D2D service seamlessly integrated with terrestrial connectivity to everyone. We look forward to sharing more details on this project in September at World Space Business Week in Paris.

I'll now comment on some details across our lines of business. Our wireless segment continues to perform well as we executed on another quarter of sequential growth with 212,000 subscribers net adds in the period compared to a 16,000 net loss in the same period of 2024. [ Boost ] Mobile continues to focus efforts on driving profitable subscriber growth and delivering an exceptional customer experience with better value than the established carriers.

The quality of our subscriber base continues to improve as evidenced by churn of 2.69%, an improvement of 24 basis points year-over-year and an industry-leading level of prepaid ARPU. A significant factor in this success is our net port positive performance. These efforts led to us ending the quarter with approximately 7.4 million subscribers. Our broadband and satellite services segment offers market-leading products and services to a wide range of consumers, enterprises and governments throughout the world. Our technology leadership in satellite networking and broadband services enables us to provide advanced communication services and solutions, fueling an 8% increase in our enterprise committed contract volume year-over-year. On the aero front, we are pleased to be recently selected by 2 large airlines to deploy our Hughes in-flight connectivity solution in their fleets continuing our penetration in the market. Our in-flight connectivities business provides the Aero industry's only future group solutions by leveraging multifrequency, LEO-GEO satellite networks with multiple connectivity providers to offer airline customers, a unique, flexible and cost-effective solution.

We have made significant advances with our in-flight product offerings such as in-line line fit production capabilities and selection by Airbus to offer joint service technology solutions to their customers via their HPC Plus in-flight connectivity program. In the second quarter, Hughes also received the AS9100 quality certification, a complement to the numerous FAA certification milestones for products we have received over the past year. We are pleased with the success of this business unit and are optimistic about future global opportunities in this market.

Finally, our HughesNet consumer business, we closed Q2 with approximately 820,000 broadband subscribers delivering higher ARPU as a result of focusing on higher-value customers. In regard to our Pay-TV business, we remain steadfast in acquiring and retaining the most profitable subscribers despite headwinds in the Pay-TV landscape from new service entrants, M&A activity and the overall cost of programming. DISH TV finished the quarter with approximately 5.3 million subscribers. Churn continues to be at its lowest levels in more than a decade excluding the pandemic, while viewership is up 8% year-over-year. For the quarter, churn was 1.29%, a reduction of roughly 11 basis points from Q2 of 2024. Our customers appreciate our exceptional product and the performance we are able to deliver as is evidenced by this decrease in churn year-over-year. Pay-TV also grew its ARPU 3% year-over-year. Despite of the highly competitive headwinds in the streaming market and lower tuning events across the sports and politics, Sling viewership increased 18% year-over-year. Additionally, Sling streaming quality reached an all-time high increasing our industry link performance measured by CONVIVA. We closed the second quarter with approximately 1.8 million of Sling subscribers.

Now I would like to turn over to Paul Orban for commentary and color on the numbers.

Thank you, Hamid. Revenue was approximately $3.7 billion in the second quarter, a decrease of 5.8% year-over-year. This decline was primarily due to fewer subscribers at our Pay-TV and Broadband and Satellite Services segments, partially offset by increased ARPU at our Wireless segment. OIBDA was $280 million in the second quarter, a decrease of $163 million year-over-year. The decrease in OIBDA was primarily driven by fewer subscribers in Pay-TV and an increase in operating loss in wireless due to our increased subscriber acquisition efforts and enhanced network coverage.

Through the first half of the year, EchoStar generated $166 million in positive operating free cash flow. This is defined as free cash flow before debt service payments and nonoperating CapEx related to EchoStar 25 and 26. Free cash flow includes debt service -- or free cash flow, including debt service, was negative $739 million for the second quarter compared to negative $191 million in the prior year. This $548 million decrease was primarily due to $326 million in higher cash interest, $163 million decrease in OIBDA and changes in working capital, partially offset by $56 million in lower CapEx. In Q2, we paid $777 million in cash interest, significantly higher than the $236 million paid in Q1. This increase reflects the timing of interest payments related to the capital we raised at the end of last year. Going forward, you'll notice a pattern where cash interest payments will trend lower in Q1, Q3 and higher in Q2 and Q4.

As a result, our free cash flow will also follow the seasonal cadence. We continue to expect positive operating free cash flow for the full year as we remain disciplined in managing our operating cost structure. We're growing our wireless and Hughes enterprise businesses.

As of June 30, 2025, our total cash and marketable securities, including restricted cash, was $4.7 billion, a decrease of $711 million compared to the prior quarter. This decrease primarily resulted from $739 million of negative free cash flow and $167 million of debt repayments. This was partially offset by the issuance of an additional $150 million of our 10.75% senior notes due 2029 and $47 million of proceeds related to the sale of our [ fiber ] business. In our 10-Q, we have included a going concern qualification. Please read the statements contained in our 10-Q to see the precise disclosure. But to provide some color, the economy rules require us to project our cash position 1 year from our filing date. The rules do not allow us to consider any new funding sources unless that financing is committed at the time of our filing. There are 2 maturities due within 1 year of this window. $2 billion due at DBS on July 1, 2026 and $1.5 billion due at HSSC August 1, 2026. We believe we have adequate time to address these maturities.

Now turning to our segment performance. Total wireless revenue in Q2 increased by 4.7% to $935 million. This was driven by a 4.1% increase in ARPU to [ 37.40 ], mainly due to a shift to higher-priced service plans and increased sales of value-added services. Equipment sales and other revenue increased by 3.1%, driven by the sale of higher-priced devices, including a greater share of compatible with their 5G network. Wireless OIBDA loss increased to a negative $452 million compared to a negative $394 million last year. This was due to higher marketing expenditures and increased costs to support the expanding footprint of the wireless network. We added approximately 212,000 net subscribers ending the quarter with just at 7.4 million subscribers. This increase in net adds was driven by historically low churn rate and higher subscriber acquisitions. Pay-TV revenue decreased 8% to $2.5 billion due to a lower average subscriber base, partially offset by a 3.1% increase in ARPU. Pay-TV OIBDA decreased $663 million from $753 million in the prior year.

This was driven by a lower average subscriber base and higher programming cost per subscriber, partially by a decrease in SG&A. This SG&A decrease was a result of lower marketing expenditures, fewer gross new DISH TV subscriber activations and reduce cost to support Pay-TV. Broadband and satellite services for VSS revenue decreased by 13.8% to $340 million. This is primarily due to lower sales of consumer broadband services and enterprise hardware sales. [indiscernible] OIBDA decreased by 17.8% to $68 million primarily due to fewer consumer broadband subscribers, partially offset by lower bad debt expense and lower marketing expenditures.

With that, I'd like to hand it over to John to cover our Boost Mobile network.

Thanks, Paul. The experience on the Boost Mobile network continues to receive accolades from customers and third-party network benchmarking companies. Most recently, OpenSignal ranked our network as the best in 5G reliability and 5G coverage in over 1,200 towns and cities. We provide 5G broadband coverage to more than 80% of the U.S. population and in combination with our partner networks, we offer customers 99% coverage across the U.S. We continue to focus on activating an increasing percentage of new customers directly on the Boost Mobile network as well as upgrading existing customers to our growing portfolio of Boost Mobile network compatible devices. Last quarter, we expanded our device portfolio to include the iPad, Apple Watches and Android tablets, including our first Boost exclusive Solero 5G tablet. Today, we have over 1.55 million customers on-net and are loading more than 75% of compatible devices on our network in the accelerated markets.

As Hamid mentioned earlier, the FCC's review of our previously approved September 2024 network build-out extension has introduced uncertainty around our spectrum rights, which has pushed us to suspend furthering our 5G network buildout. Therefore, we have little to report regarding network expansion within the second quarter. Until this matter is resolved, we are focused on continuing to optimize the network infrastructure in place and continuing to add customers to our network. Wireless CapEx in Q2 was $171 million. We are not providing network CapEx guidance for the second half of the year at this time.

However, we are finishing construction for certain [ cell ] sites that are in process. As a company, we have always had the vision of delivering global connectivity seamlessly and integrated between terrestrial and nonterrestrial connectivity. We built the world's first 5G stand-alone Open RAN network and have been applying this technical know-how to integrate 5G terrestrial connectivity in coordination with NTN services, specifically with the new LEO constellation across our AWS-4 spectrum in the U.S. EchoStar and Boost Mobile's extensive experience in building and operating satellite services and terrestrial mobile 5G networks uniquely positions us as a telecommunications company at a truly global scale. We look forward to continuing the important work of helping the administration and FCC continue to deliver for the American people.

Now I'd like to turn it back to Hamid for a few short closing comments.

Thank you, John. We are pleased with the overall performance for the second quarter and are optimistic about our opportunities in the second half of 2025. We remain focused on hitting our operational targets and positive operating free cash flow, optimize subscriber profitability from our Pay TV segment, expansion of Hughes Enterprise business and continued growth from Boost Mobile. With that, we'll open it for Q&A from the analyst community.

[Operator Instructions]

And the first question is from the line of Rick Prentiss with Raymond James.

A couple of questions. Hamid, I'd like to start, obviously, on the news of the day, the nonterrestrial network direct-to-device LEO constellation. And we've known for a long time and I've chatted about the S-band and the value it could have, but it would take some capital to operationalize or monetize it. questions I've got on the nonterrestrial network is. Is this a decision that you then are going it alone? Or is there potential for more partners? The service level sounds like you want to do more than just messaging. You want to get 2G, 3G, 4G, 5G, how will you go to market? It's a crowded marketplace. There's a lot of people talking about it. Do you anticipate going direct to the consumer or direct via carriers, via OEMs? And also maybe can you lay out a little more the pacing of that $5 billion peak funding?

Great questions. And the one asked -- I'll sort of parse it out to the best of -- best of my ability. If I miss any part of it, we'll come back to it. Let me start with one of the middle parts you mentioned is a crowded market. And I want to say that there's no one, no one today, no one today and no one on the road map today, we see that it's going to do wideband. We are the unique one. Everybody that today -- let me parse yourself for you guys. When we talk to satellite connectivity, there are 3 different, completely different products such as segments. One they call broadband and that is connectivity from space to a DISH antenna that usually is mounted whether you can move it or not is a different story, but is an antenna that is on the ground somewhere unique piece of equipment, whether it be our HughesNet and China net is there, whether it be somebody from [indiscernible] has one, StarLink has one. Others have [indiscernible] will have some, that replaces your broadband connectivity at home or broadband connectivities in some other locations.

Then you have the narrow band on the far right end of the product set, which is messaging on SOS, Apple has that, we have that in Europe, we have had it for a long time in Europe, it's being sold not under our own brand, but we allow the people to sell it. We'll be offering that in the U.S. We have always had the capability using our geostationary satellites. Starlink and T-Mobile offer that today in Apple and Globalstar offer that today. That's messaging in SOS. And then you've got something in between that is ours, and we call that white band, and that is a natural use case of your mobile phone, the way you use it today. It is not messaging only. It's not SOS, it's not a station. It's in your pocket, it's in your purse, it's in your briefcase, you move around anywhere in the world, maybe on the top of the mountains or in the middle of oceans or in the middle of Frankfurt or in the middle of Toledo, you're going to get the same connectivity to the satellite and you will not be able to tell a difference whether it's connected to the satellite, we should sell in the sky or is it connected to the sale in your neighborhood, that nobody else has. And nobody else is ahead of us.

I want to be very clear about that. And so there may be a lot of confusion about this marketplace is crowded, perhaps crowded in the broadband space, maybe crowded [indiscernible] at some point in the narrowband space. but it's 0 crowd right now in where we can vote, and we are doing it. And why are we unique in doing that? I can't give you [indiscernible] reasons. But the first of it is that we have the unique collection rights around the world, nobody else has. And second thing, we are focused on 5G NTN and the standardization, which we have worked very hard to standardize and develop for our spectrum piece, marrying it to our AWS and S-band so that you can have this exact same architecture as 5G that we have in our network on the ground, in the sky, moving the cell from your neighborhood to the guy. That's all we're doing, which seems very simple in concept, obviously, takes incredible amount of work that has been done for over a decade to materialize. But I want to say that nobody else is doing that, and that's my claim, and you can quote that.

Now coming back to going alone and we partners, look, at this point, we believe we have everything in-house to make this happen, but we have never been close to partnerships. Never, on any part of our business. Today, we are a great partner of many, many governments and countries and airlines in our Hughes business. We are absolutely appreciated across the world, welcome everywhere from Brazil to Europe to Far East.

In Middle East, we have been stable supplier everywhere in the world, and we continue to be a trusted partner of everyone. And we are not planning to take this to market in a way that we discriminate against the carriers. Our business model relies primarily on a wholesale model, a partnership relationship with every carrier around the world in a nondiscriminatory basis. You want to make this available to 8 billion people in the most easy cost-effective and convenient way, that is our target. And we believe we are well on the way of doing that. Remember, the system is going to continue to grow, both in terms of number of satellites and in terms of capabilities and technological improvements that are absolutely relevant and usually available in the telecom industry in a very quick fashion when you're investing to them.

And in terms of expenditure, we talked about a peak funding of $5 billion. You can imagine that, that $5 billion is not due day 1. And when the satellite is going to be service 29. So you have to assume that there's a typical payment schedule for the industry. We can't disclose any of that for both confidentiality and other reasons. But you can imagine that's over a longer price horizon. But I also want to say that the system is in perpetuity after that peak funding in our business model funded.

So this is not one of those cases where as we increase the satellite number, as we enhance the capabilities of the satellites and we launch new ones that we need additional injection of capital, our business model, easily self-fund all of that R&D and additional expansion. So we expect that this to be a onetime $5 billion investment and again, the onetime investment is spread over a window of time with a peak funding calculation to be $5 billion as of that point, after the peak funding on a typical business model, you start paying down what you have already paid. So it goes -- it starts paying back. I hope I answered the 6 or 7 questions you hold in there, but if there's any pieces that I may as happy to talk about.

Yes. Just one other ancillary then I'll go to the 5G network question. Do you envision this as a replacement for terrestrial wireless, a complement to terrestrial wireless, how would you envision how this would fit into the marketplace?

The answer is yes. Like every other technology, this will start the -- in our vision and view, this starts being a complement to every terrestrial network out there. It's not trying to replace a terrestrial network, it'd be a great complement covering 70%, 80% of the world's surface that is never possible or economically viable to cover terrestrially. But as the technology becomes more capable and the amount of capacity from the sky becomes much, much larger than its very, very initial version which anyway, comes back with me. When we're talking about versions and generations. You can imagine there are only a couple of years apart. These are not like 5G, 6G, 4G that are 10 years apart. You can imagine batches of satellite being only 18 months apart and 2 years apart, and they go up. So technological generation if there is such a thing in this case, very rapid. So very quickly, in a short few years, we're going to get to on that the satellite capability will be far, far larger.

As a result of that, it will eliminate the unnecessary heavy cost structure and a burden on a carrier covering very likely populated rural areas, highways and roads, rural roads where it really is uneconomical. As you know, a great portion of a carrier's network is economical. They're doing that just to have the service for people who travel rarely and occasionally through and that's just become a necessity. But once the satellite capability goes higher, you could eliminate hundreds of thousands, potentially millions of cell sites that are not green, not cost-effective, not friendly, hard to maintain. They need air conditioning in a middle of a desert and a bunch of other things. And all of those things will go away. So the answer -- a very long answer to a short question is, it starts as being a very good complement, but over time, it can [indiscernible] the carriers from the obligation and the cost structure to pay for those -- in fact, the biggest beneficiaries will be terrestrial carriers that they can have the great service without having to actually pay the cost structure in the longer term. But in the short term, I just want to say that the initial version will be a 100% complement. It is our intent to work with every carrier around the world on a nondiscriminatory and very friendly business-enhancing fashion, we will be -- we absolutely will be complementary for every carrier's business model.

Our next question is from the line of Walter Piecyk with LightShed.

I guess let's bring the dialogue back to Earth on this one. Hamid -- Chairman -- or excuse me, Chairman Car has said, there's really not a need for foreign network operators in the market. Obviously, there's stuff in the press about best and final. I know you said in your prepared comments, you can't really talk about it, but you have suspended capital payments on the network. So I guess if we just assumed that these things get resolved, you get funding, right, because you do have a going concern and would you address that you can hit those, it doesn't factor in additional capital you brought in. But the result of whatever is going on with Car in the FCC is that you remain a network operator? I know that's not necessarily assured one way or another, again, depending on how things play out. What is the go-to-market strategy as the fourth network operator. And do you think that, that at this point, requires a major distribution partner? Because it seems like with gross adds insured up across the 3 operators, there is an opportunity. It doesn't feel like cable is that alternative because based on what Brian Robert said on his call earlier this week, doesn't necessarily want to partner in that way or own assets. So like how does it -- like how does this work if you remain a network operator?

Thank you for, again, many questions, Walter. So as I mentioned, I cannot be specific about how we foresee much that is in play today in terms of our discussions with FCC. I will certainly not comment on whether the market needs 3 players, 4 players. All I know is that I am the fourth player and until change things, I've notified to do something different. My head is down in the weeds running the best business I possibly can as a fourth player in the U.S., competing, winning, you've seen us. We are disruptive. We have taken share. We have gone from losing hundreds of thousands of subscribers per year to gaining hundreds of thousands of subscribers and a net port positive. We will operate -- we continue to operate till a different -- if and when a different avenue is open for us or is demanded of us, we'll certainly head in that direction.

But we need to maximize the value that we have for our shareholders. Be the player that people want us to be in the marketplace, serve the customers that we are increasing serving. And I will not try to predict or project what the market may end up being -- you referenced cable, you referenced others. I certainly don't control their business or their strategy and unable to comment on any of that. All I want to say is that we find ourselves in a very unique position, we have been a good carrier. I think we have delivered on everything that we have been asked to do and committed as part of the formation of Echo, I guess at that time, DISH Network and now EchoStar. We'll march along, what we have done today has been in the works for a very long time. I won't comment on how the funding -- you talked about that.

All of that I'll make more clear when we share with you a more holistic picture of our financial situation and our system when we get to, hopefully, the satellite show in Paris. All I know is that we have a very positive step in front of us right now with this announcement we made today we will work very collaboratively with the FCC to find an amicable solution that is in the best interest of everyone. We still have all the options in front of us. We have not closed any doors with any angle or avenue that we could pursue, but I remain constructive in my view that we will find a require solution going forward.

And given that you're not spending on the network and likely pulling back on marketing expenses, given the issue, maybe not. is there any reasonable time frame that you can provide in terms of when -- whatever the resolution is reached with the FCC? Are we talking by end of year, by end of quarter and like any type of ballpark kind of end date you can give us on this timeline.

Again, it's primarily not up to us. We have been constructively working with FCC to answer -- provide responses to each one of their inquiries, including detailed information that comes our way as a request from FCC, also in parallel working with the right ranging number of alternatives to make sure we may find a win, win, win, I guess, I'd like to call it solution. Since we have not on all sides of that, I can't predict how this will go, but I want to say that we, from our side, we are not passive. We're not sitting there and we are progressing with our discussions everywhere we can, but it all depends on other parties needs and desires. I would think that this will not be years away, just probably not very far away. I think the patients at FCC request of FCC has been that we do something together in a reasonably shorter timeline, but I wouldn't necessarily tell you that I have a hard deadline a milestone in my mind about how we come to a closure.

I know it's a softer answer that you expect to get, but candidly, I don't control all aspects of it. And all I can say that if there is a delay in finding a solution, it is not because of us. We have every -- it is the highest priority for me and my team, and we're not taking it lightly.

Next questions from the line of Bryan Kraft with Deutsche Bank.

I guess I had a follow-up question on the LEO constellation announcement. So I wanted to confirm, so the right interpretation of the press release language, and I appreciate that you don't want to share details when payments are being made. But is the $1.3 billion for the first 100-plus satellites, roughly the amount that gets invested through 2028 or is the $5 billion the number that gets invested by 2028 or shortly thereafter? Just those are orders of magnitude different. So I'm just trying to get a sense for what that capital envelope actually needs to look like for you? And then I have a follow-up after that, if that's okay. So sorry, go ahead.

Sure. Yes, the $5 billion -- that's not about $5 billion because that's the more umbrella headline. The $5 billion is the overall peak funding of the project, and I have not specified at least in today's discussion as to when that peak funding will be reached, how many years down the road or days or months down the road that may be, but the peak funding includes, obviously, your satellites, includes the cost of launching them, inclusive cost of gateways, operations, everything else that you have to have in a typical business plan as you would put together. Now the peak funding at some point will be reached, who knows. I'm not specified, as I said today, how many years down the road that will be. But warranty reaches -- so therefore, we need to have, by that time, a total capital of $5 billion available to us and post that window, post that peak, every day, the system pays back that investment obviously has a typical private equity case, you ultimately end up paying that money back and you end up generating the additional value that the system delivers to you.

The $1.3 billion is the one piece of that $5 billion that we announced as a result of having made a commitment or agreement with MDA to manufacture the satellites. We have not talked about any of the other components yet of cost structure, which hopefully we will be more informative about and be able to give you more in Paris, which is only a few weeks away. And today, the most important piece is that we have embarked on that journey, which the rest of the picture will also come into play as we are 100% committed to being the best provider of direct to satellite connectivity wideband way. The second part of your question, if there's any [indiscernible] to follow through.

Yes. So I guess I just want to understand, too, what are the service capabilities that you expect to be able to offer, let's say, in 2028, it sounds like that's in the service would launch in terms of geographic coverage, I assume it would be a 24-hour service, what kind of bandwidth and also just high level, what do you think the revenue model looks like for D2D? Is it a revenue share model with carriers? Is it sell them low-cost capacity on a per gig basis? Just curious how you're thinking about that.

Okay. So the service -- our vision of the service is even from day 1 will be to offer everything you have in your pocket today. So if you do text voice, video, face time, accessing your apps. And if you're in the middle of Grand Canyon or the middle of the Atlantic Ocean and you just want to watch Netflix, we want you to watch it. Whatever you do on your -- you can't tell the difference whether you cell -- your phone is connected to the nearer cell side, very cell side. Is it 600 kilometers above you or 2 kilometers to your right. That is the standard. That is the standard we have worked on and the architecture we have tested and we put it in place and we manufacture. No one else is doing that. I want to be very under record. So when they say crowd of the space, yes, other parts of the industry is crowded. This 1 is 1 player and uniquely positioned to do it. Now of course, on day 1 and the first version and then the smallest number of satellites, which I call minimum viable offering to start you don't have all of that capacity in a way that every person can do that, and we're not planning to do that. We're planning -- this is not replacing the -- where you already have great four other carriers covering the neighborhood. But as soon as you go out of it, and there's hundreds of millions of people that are outside and they're travelers and the governments who want different medians, security services, drones, unmanned vehicles, everybody else that needs to be connected that are not and necessarily only reliant on terrestrial coverage, we'll be able to serve this. But our product will be indistinguishable from what you already have on your iPhone or your Android phone.

As time goes on, the system capacity goes higher, this becomes more affordable, more available to more people. So I can envision that just to be safe, let's put it 20 years down the road, you're going to get to a point that anybody anywhere who want to watch Netflix, they can also watch it through the satellite, they don't have to watch it through terrestrial. That's possible. So let's just leave that.

Now -- so that's -- now in terms of go-to-market model, as I said, we are not planning to compete with the carriers. We are producing this as a benefit to the carriers. It will be an additional source of revenue for the carriers. It will be a service enhancement for the carriers. The carriers will be offered instead of 99% coverage or 82% coverage, 100% coverage of globe, not just even where people -- their houses are, whatever they travel.

So our model, we are not able to share the details of our model, but I think it will be value enhancing for carrier and us in a collaborative way. We do not wish to go direct to consumer. We may be forced to do it or choose to do it in cases where there are no carriers in some geographies over the waters or other places where we may have the obligation to do it or some other way we want to do it. But that would be an abnormal very unusual corner case. We really like to go to the market with the carriers using their relationship with their customers, strengthening that relationship with their customers, making sure the regulators and local laws and everybody else is happy about our offerings in the countries. So that is our path to market, very collaborative with governments, regulators, carriers, everyone. That's our model.

Our next question is from the line of Ben Swinburne with Morgan Stanley.

Just sort of sticking on the topics of the day, Hamid. You've suspended spending on the wireless -- on the 5G network. But are you going to be moving forward with your investments in this LEO project? And I don't know if it starts immediately, but you've obviously signed a contract with MDA. It just seems -- I'm a little confused as to why you'd be moving forward with one and not the other, but maybe I'm just thinking about the timing differently.

Sure, I'll be happy to explain. That's a very good question. I would say that, look, our direct satellites. You know I've talked about it almost every earnings call. And in fact, going back to the merger of the 2 companies, a key decision factor, a criteria and benefit of bringing DISH and EchoStar together was to activate this opportunity. We have the spectrum on site. We had the technology on the other side. There was 2 hands that we wanted to clap. We need to bring them together. And we did -- so this is not an accident that we are doing this. This is -- there's nothing to do with -- honestly, I have nothing to do with any of the recent events.

Now you have a very good question. Your question is that if you have this network issue that you are saying, hey, I don't know until I resolve with the FCC, all my issues, I'm hesitant to invest in the network, but why aren't you hesitant to invest in the space? I think that's the nature of your question. We can't alter the terrestrial. I can slow down to get more clarity, and I don't lose a lot of market opportunity. I don't because I have a national roaming. We already have a great, great coverage, 280 million [indiscernible] consumers are covered. I have perfect experience with my consumers, the lowest churn, highest ARPU, I'm satisfied. I'm winning. I'm winning -- I got more consumers prepaid customers that almost all of the other carriers this quarter. And so we're winning there. And I don't need to do anything until I have uncertainty shows up.

As it comes to space, I don't have that luxury to wait. The opportunity is here and now. And if I wait a few more months, my business model gets impacted negatively. Europe is in the process of asking us and everybody else how we are going to get to space, I need to have a definitive answer in Europe. I want to have this American leadership, and I don't want to lose it in Europe. I don't want to lose it in other places.

If I wait to resolve this, that opportunity for U.S. and us is lost. And so we have decided to continue on the path we have been on the direct to satellite because we cannot wait. That is critical time path the national network deal, we're already in a phenomenal position. We have over 24,000 cell sites. And so I don't see a few ups of delay until we have more clarity detrimentally change my business 1 way or the other.

Yes. That makes sense. That's a helpful answer. Is there any reason why you are going to be able to share a lot more detail on this in Paris than on this call other than that's a more important audience than maybe this one.

So absolutely, the most important audience is obvious, that is to me, no matter who it is, but -- but no, [indiscernible] that this is in development. There are many more pieces that have to come together for this picture to be clear, for instance. The satellite is 1 piece. We still need to talk about all the other components, this launch that we have talked about. We have to talk about gateways, we have to talk about -- but there was a question earlier on that I didn't -- I forgot to, I guess, cover on the day 1 of the service, we will cover almost all citizens from 60 north to 60 south latitude. So that would be -- that's almost everybody except for North pole and South pole, which we have the opportunity to cover, but we will leave that for discussions with governments and militaries that's where the biggest customers are, but we have designed a system that we can provide 100% coverage of the poles.

So there's still a few a few things in play that I think in the next few [indiscernible] we will clarify and sort out, I think then we can provide more holistic answers. It really isn't to try to hide the ball from you. It's just that I don't have -- I don't want to change the answer in a few weeks. I want to be completely comfortable with every angle of it, and then we share more of the business model and details with you. It's only a couple of weeks away.

Okay. And last question, I'll take a swing at this. I know it's a tough one. But I think everyone understands what EchoStar is trying to do with your business. What does the FCC want? What is the end game for them? Because they've sort of made a bunch of accusations about your spectrum use or lack of use and the milestones, the press, I think, in the market at 1 point, I think, things they want you to sell your spectrum, maybe there's an Elon Starlink angle. It's just sort of hard for us outside of all this to figure out what the FCC is asking EchoStar to do. I'm wondering if you could share anything there for us.

Yes. So first of all, we -- I want to reiterate and say that we believe we are standing very tall and good on every obligation we have ever made to FCC. So we stand behind all of those. Today, we have always done, we do it today again. We have made the certifications. We have delivered on every commitment, any trade that we have made with FCC and relied on FCC's approval has been as a result of us committing to something else that we have delivered. We've committed to put consumers up more for customers On-Net that have a price plan that is one of the lowest in the industry, a bunch of other things. But in terms of what FCC one, I think that's a good question for FCC. Honestly, we -- I cannot comment on that because we also ourselves, have been in the process of discovering more and more what is it that would satisfy the FCC. Why would these inquiries come when we believe we have been on one of the companies that have been most flexible in terms of meeting the needs of FCC Justice department and everybody else. So you're right, I cannot answer any more than that because I honestly don't know. And that's a great question for FCC.

Next question is from the line of Sam McHugh with BNP Paribas.

I have a few. I'll start on wireless. You obviously had a great quarter in terms of net pretty high cost. I guess in context of the going concern of the spectrum stuff, do you think you still have a similar budget for subscriber acquisition in the second half of the year? Obviously, you pull back on the network CapEx on the subscriber side as it all [indiscernible] add?

Look, we make a decision, honestly, on -- as it comes to operating business, I make the decision on a very dynamic basis on the market conditions. We do intend to continue to be in a market, and we're not pulling back from our go-to-market. If the market is receptive to our offers, and I see a market that is still in demand, we'll invest -- we'll get consumers. But I want to tell you that the market on the consumer side is very volatile today. Is it tariffs? Is it economy? Is it immigration? Is it what is it? I have no idea. But the market demand it's unpredictable. We had a great start to the year, even though we delivered our best results so far in the history of this acquisition, the first part of the year, the first few months of the year, all the way through May, markets seem to be stronger, but now seems to be a little less strong.

So if the market is not as strong, I will choose not to invest as much into it because the cost of acquisition will not be justified, so a long way of saying, I'm not changing our acquisition strategy, but you have to know that, that is in itself a very big variable depending on conditions of the market. If I don't find a favorable market, I may acquire less customers, if I find it continuing to be in good demand, I will increase my spend in the market. But it's not relevant, but it's not as a result -- but it's not as a result of anything that is going on with FCC today.

All right. And then on -- more broadly on the wireless business, is it still core for you or would this direct device, do you think there's a path maybe to shift to more wholesale business? And have the talks around spectrum with the FCC maybe change your view at all on that difference?

I'm sorry, I'm trying to get the gist of the question. I may have missed the gist of it. Could you tell me one more time.

Yes. So I was just saying is running a retail wireless business still core for you? It feels like with the director device and what the FCC is saying around spectrum. Do you think there's a future of EchoStar where you become more of a wholesale provider rather than direct-to-consumer?

We, today, are -- I am not predicting that we are changing our model in any way other than the fact that we have always talked about adding this, how the future goes, obviously, as I said, is a result of a dynamic picture that is of the industry of discussions with FCC, but we have been committed to doing both. We have not been pulling back from one or the other. We've not been trying to switch from one to the other. Let's see how the future holds as some of these developments in the industry happen. We are very capable, incredibly well positioned to do both. We have expertise in satellite. We are the only company in the world that knows how 5G ORAN really works in great scale as a stand-alone. We can marry the two together very well. And again, a unique position of either both a carrier and a satellite company -- satellite technology company puts us in a unique position. But let's see how that goes in the future.

So thank you for the question. Next, I think now we can take 1 more question in the interest of time. Please go ahead.

That question will be coming from the line of Craig Moffett with MoffetNathanson.

Returning to the direct-to-device satellite business for a second. Just given the cash constraints on your business, it's reasonable to assume that you'll be looking for additional financing or financing partners. Are there spectrum bands or other assets that you would be willing to commit and put liens on for that debt? And how do we think about that in the context of the current creditors and the calls on your existing assets?

Right. Again, a very good question, Craig. Thank you for asking. Look, as I said, I'm not in a position to describe the entire financial picture of this -- the company and this project. But obviously, you need -- you must assume that we're looking at that picture in trying to make sure we are within the means that we can deliver on, and we are within the means of meeting every obligation we have always had. So it is not lost upon us that when we add another $5 billion in here that we need to somehow finance it. We need to meet other obligations.

So I'm repeating your question in a way to say that I understand the question, it's not lost on us that we have to -- have answers for those. I don't believe I can -- I know that I cannot give you those answers today for a variety of reasons, not just 1 or 2, but there's a variety of reasons. I cannot provide you a complete detailed answer today. But as time goes on, starting with the satellite show, we hope to disclose more of that and clarify more of that picture. It is my intent to be as transparent as I possibly can, but sometimes that transparency either is not possible or strategically not in the best interest of our shareholders. and that's my job. So we disclose the information we must as soon as we can.

Great question, Craig, we will be more informative about what our financials look like. It's not lost upon me or anyone in this business that we do have a significant amount of financial obligations. We believe this is very conducive to solving those and making those better as opposed to worse. Otherwise, we wouldn't be doing it. So I hope that answers at least partly what you needed to hear.

Well, can I ask a follow-up then? I mean, would it -- there was a report earlier this week in Bloomberg suggesting that the FCC was pushing for spectrum sales from AWS-4. Would selling part of your spectrum be a potential avenue for raising capital? And I would presume if the FCC is pushing for that kind of an alternative, they would be inclined to waive the constraint on who would be available to buy it under the consent decree or waive it sooner. If that were waived and the big 3 were able to be participants in an auction for your spectrum, would you consider selling assets as a way to raise capital?

I don't -- I can't say anything about Bloomberg's article. All I can say is that it did not come from us. And I -- therefore, I have no way of knowing what the source of that comment is, I'm not even able to speculate as to where we make that comment may have come from. It is not -- it's not something I can comment on. I mean, all the information available from FCC is the information that you have already peered, FCC would like to see more spectrum in use. I'd like to see the market become more efficient in a number of ways, and I think we understand that. And there's a million ways that can happen. Those million ways have not yet landed in a way that I can give you a full picture. We have not eliminated any options from the table. FCC has not necessarily given us a very, very detailed mandate of a certain thing or another.

I think we still in collaboration with FCC and other entities to see what might be a good solution that everyone is happy with. So I honestly would not build any more on what Bloomberg has reported than another piece of information in the market that may may not be true.

Thank you, everyone. Thank you, everyone, and I hope to see you in Paris or our next earnings call.

Thank you. This will conclude today's conference. You may disconnect your lines at this time. We thank you for your participation. Have a wonderful day.