Dish Network announced today that it intends to offer, subject to market and other conditions, about $2 billion aggregate principal amount of its senior secured notes.

The announcement comes as Dish reports its third-quarter earnings. The company said retail wireless net subscribers increased by about 1,000 in the third quarter, compared to a net decrease of 121,000 in the year-ago quarter.

The company has been losing wireless subscribers since it acquired Boost Mobile through the government-structured T-Mobile merger with Sprint, so the positive trajectory in net adds is notable. Dish is building a nationwide 5G network to compete as a fourth facilities-based provider, replacing Sprint.

The company closed the quarter with 8.01 million retail wireless subscribers.

The offering

The company said the net proceeds of the secured debt offering are intended to be used for general corporate purposes, including the buildout of wireless infrastructure. 

“The notes will be secured by certain assets of certain DISH Network subsidiaries,” Dish said in a press release.

Analysts at New Street Research said the pace of the network deployment is probably the single most important issue for the company.

“They are still deploying at a pace of 1,000 sites per month, which puts them on target to meet their obligations. The company disclosed that the build will require approximately $2BN in additional capital to reach the June 2023 target,” wrote New Street in a report today.

The company ended the second quarter with about 5,000 sites deployed, and by the end of the third quarter the company had completed construction on 10,000 sites, capable of providing coverage to 35% of the U.S. population.

Analysts at MoffettNathanson have a grim assessment of Dish’s prospects in wireless, saying they view bankruptcy as the most likely outcome for its wireless business. Dish’s core challenge has been securing financing, wrote analyst Craig Moffett in a report for investors today.

Even with capital spending that was nearly $300 million below expectations, Dish is now burning cash, a problem exacerbated by significantly weaker-than-expected EBITDA generation for both their satellite and wireless MVNO businesses, Moffett said. The company reported negative third quarter free cash flow (including capitalized interest) of $118 million.

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