DISH Network (NASDAQ:DISH) on Wednesday delivered its second-quarter financial results. And the numbers didn't do much to change the overall story: Pay TV is still in a stubborn, yet profitable, decline.


Source: DISH Network.

For the quarter that just ended, DISH's sales ticked up by a healthy 5% to reach $3.69 billion. However, nearly all of those gains came from higher package prices, and not from a growing army of satellite dishes pointing at the sky. In fact, the TV provider lost 44,000 members over the past three months on a net basis, leaving total membership at 14 million. Sure, that was an improvement over the 78,000 that DISH shed in the prior year's period, but that's not much of a silver lining.

The overall results mirrored those of rival DirecTV (NASDAQ:DTV), which is the industry leader with 20 million domestic subscribers and posted its own quarterly figures last week. Like DISH, DirecTV shed customers in the U.S. last quarter, albeit at a slower pace than before. Meanwhile, price boosts helped both companies log increases in average revenue per user, or ARPU. Those ARPU gains were a big reason revenue is still growing even as their subscriber bases aren't. 

Both companies also cited "competitive pressures" as a key reason that churn, or the rate at which subscribers cancel, has remained elevated. And like DirecTV, DISH reported a large jump in profits this quarter as earnings climbed to $0.46 a share from last year's $0.02 loss. 

Still, a straight-up comparison shows that DirecTV is outperforming DISH in many key financial metrics, which is likely a big reason why AT&T is buying DirecTV and not its smaller rival.

For example, DISH's churn rate was 1.66% in the second quarter, significantly above DirecTV's 1.55%. ARPU was solidly higher for DirecTV, at $103 versus DISH's $84. And the same goes for profitability: DISH's operating profit margin was 12% while DirecTV's was 18%. 

Key takeaway
The two biggest satellite TV providers are suffering from a tough economic environment, and it doesn't seem likely that pay-TV subscriber growth trends will turn sharply positive anytime soon. However, for investors interested in this market, DirecTV looks like the better choice right now, as it's doing a better job at weathering these struggles.

Demitrios Kalogeropoulos and The Motley Fool have no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.