S&P Predicts Dish's Financial Issues May Prove Challenging for EchoStar
EchoStar could face challenges meeting its financial commitments during the next two to three years, S&P Global said Friday as it assigned the company a CCC+ credit rating following the closing of the deal creating EchoStar/Dish Network (see 2401020003). EchoStar…
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must raise substantial funds in the coming years for its capital spending, offsetting wireless losses and debt maturities, S&P said. Dish will likely need to raise about $1.5 billion this year to address $2 billion in debt that matures in November, and another $2.5 billion in 2025 "before a massive maturity wall approaches in 2026." While Dish needs success in its 5G wireless business to lower its cost of capital and service its debt, that success "is highly uncertain," it said. S&P predicted that Dish's 5G ambitions in the postpaid market will struggle as it tries to capture business in a mature wireless market with large, established competitors. It added that cable is already competing in the more price-sensitive segment of the wireless market through bundles of mobile and broadband service. Hurting Dish is a lack of meaningful contracts with large enterprise clients and a strategic partner that could help drive revenue growth. S&P said 5G private network adoption is progressing slowly, and the addressable market will be much smaller in 2025 than Dish management projected.