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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.  20549
 
FORM 10-Q 

(Mark One) 
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2022.

OR

    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM                TO                
 
Commission File Number: 001-33807

sats-20220331_g1.gif
EchoStar Corporation
(Exact name of registrant as specified in its charter) 
Nevada 26-1232727
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
   
100 Inverness Terrace East, Englewood, Colorado
 80112-5308
(Address of principal executive offices) (Zip Code)
(303) 706-4000
Not Applicable
(Registrant’s telephone number, including area code)(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Class A common stock $0.001 par valueThe NASDAQ Stock Market LLC
(Title of each class)(Name of each exchange on which registered)
SATS
(Ticker symbol)
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.  Yes   No
 
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes   No 
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.  See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.  (Check one):
Large accelerated filerAccelerated filer Emerging growth company
Non-accelerated filerSmaller reporting company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes No

As of April 28, 2022, the registrant’s outstanding common stock consisted of 37,228,906 shares of Class A common stock and 47,687,039 shares of Class B common stock, each $0.001 par value.




TABLE OF CONTENTS
 
   
  
   
  
 





DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (“Form 10-Q”) contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including but not limited to statements about our estimates, expectations, future developments, plans, objectives, strategies, financial condition, expected impact of regulatory developments and legal proceedings, opportunities in our industries and businesses and other trends and projections for the next fiscal quarter and beyond. All statements, other than statements of historical facts, may be forward-looking statements. Forward-looking statements may also be identified by words such as “anticipate,” “intend,” “plan,” “goal,” “seek,” “believe,” “estimate,” “expect,” “predict,” “project,” “continue,” “future,” “will,” “would,” “could,” “can,” “may” and similar terms. These forward-looking statements are based on information available to us as of the date of this Form 10-Q and represent management’s current views and assumptions based on past experience and trends, current economic and industry conditions, expected future developments and other relevant factors. Forward-looking statements are not guarantees of future performance, events or results and involve potential known and unknown risks, uncertainties, including the impact of the coronavirus pandemic (COVID-19), and other factors, many of which may be beyond our control and may pose a risk to our operating and financial condition both the near- and long-term. Accordingly, actual performance, events or results could differ materially from those expressed or implied in the forward-looking statements due to a number of factors including, but not limited to:
 
significant risks related to our ability to operate and control our satellites, operational and environmental risks related to our owned and leased satellites, and risks related to our satellites under construction;
our ability and the ability of third parties with whom we engage to operate our business as a result of the COVID-19 pandemic, including regulatory and competitive considerations;
our ability to implement and/or realize benefits of our investments and other strategic initiatives;
legal proceedings relating to the BSS Transaction or other matters that could result in substantial costs and material adverse effects to our business;
risks related to our foreign operations and other uncertainties associated with doing business internationally;
risks related to our dependency upon third-party providers; and
risks related to our human capital resources.
 
Other factors that could cause or contribute to such differences include, but are not limited to, those discussed under the caption Risk Factors in Part II, Item 1A of this Form 10-Q and in Part I, Item 1A of our most recent Annual Report on Form 10-K (“Form 10-K”) filed with the Securities and Exchange Commission (“SEC”), those discussed in Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part I, Item 2 of this Form 10-Q and in Part II, Item 7 of our Form 10-K and those discussed in other documents we file with the SEC.
 
All cautionary statements made herein should be read as being applicable to all forward-looking statements wherever they appear. Investors should consider the risks and uncertainties described herein and should not place undue reliance on any forward-looking statements. We do not undertake, and specifically disclaim, any obligation to publicly release the results of any revisions that may be made to any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
 
Although we believe that the expectations reflected in any forward-looking statements are reasonable, we cannot guarantee future results, events, levels of activity, performance or achievements. We do not assume responsibility for the accuracy and completeness of any forward-looking statements. We assume no responsibility for updating forward-looking information contained or incorporated by reference herein or in any documents we file with the SEC, except as required by law.

Should one or more of the risks or uncertainties described herein or in any documents we file with the SEC occur, or should underlying assumptions prove incorrect, our actual results and plans could differ materially from those expressed in any forward-looking statements.
i

PART I — FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS
ECHOSTAR CORPORATION
CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share and per share amounts)
(Unaudited)
 As of
 March 31, 2022December 31, 2021
Assets  
Current assets:  
Cash and cash equivalents$889,199 $535,894 
Marketable investment securities634,593 1,010,496 
Trade accounts receivable and contract assets, net199,306 182,063 
Other current assets, net209,905 198,444 
Total current assets1,933,003 1,926,897 
Non-current assets:  
Property and equipment, net2,376,143 2,338,285 
Operating lease right-of-use assets150,980 149,198 
Goodwill535,394 511,086 
Regulatory authorizations, net470,329 469,766 
Other intangible assets, net17,792 13,984 
Other investments, net350,318 297,747 
Other non-current assets, net335,794 338,241 
Total non-current assets4,236,750 4,118,307 
Total assets$6,169,753 $6,045,204 
Liabilities and Stockholders' Equity  
Current liabilities:  
Trade accounts payable$109,390 $109,338 
Contract liabilities138,201 141,343 
Accrued expenses and other current liabilities176,083 209,442 
Total current liabilities423,674 460,123 
Non-current liabilities:  
Long-term debt, net1,496,185 1,495,994 
Deferred tax liabilities, net430,808 403,684 
Operating lease liabilities136,723 134,897 
Other non-current liabilities124,450 136,426 
Total non-current liabilities2,188,166 2,171,001 
Total liabilities2,611,840 2,631,124 
Commitments and contingencies








The accompanying notes are an integral part of these Consolidated Financial Statements.
1




ECHOSTAR CORPORATION
CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share and per share amounts)
(Unaudited)

Stockholders' equity:  
Preferred stock, $0.001 par value, 20,000,000 shares authorized, none issued and outstanding at both March 31, 2022 and 2021
  
Common stock, $0.001 par value, 4,000,000,000 shares authorized:
  
Class A common stock, $0.001 par value, 1,600,000,000 shares authorized, 58,441,449 shares issued and 37,646,656 shares outstanding at March 31, 2022 and 58,059,622 shares issued and 38,726,923 shares outstanding at December 31, 2021
58 58 
Class B convertible common stock, $0.001 par value, 800,000,000 shares authorized, 47,687,039 shares issued and outstanding at both March 31, 2022 and 2021
48 48 
Class C convertible common stock, $0.001 par value, 800,000,000 shares authorized, none issued and outstanding at both March 31, 2022 and 2021
  
Class D common stock, $0.001 par value, 800,000,000 shares authorized, none issued and outstanding at both March 31, 2022 and 2021
  
Additional paid-in capital3,343,056 3,345,878 
Accumulated other comprehensive income (loss)(173,280)(212,102)
Accumulated earnings (losses)747,899 656,466 
Treasury shares, at cost(471,582)(436,521)
Total EchoStar Corporation stockholders' equity3,446,199 3,353,827 
Non-controlling interests111,714 60,253 
Total stockholders' equity3,557,913 3,414,080 
Total liabilities and stockholders' equity$6,169,753 $6,045,204 
The accompanying notes are an integral part of these Consolidated Financial Statements.
2

ECHOSTAR CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share amounts)
(Unaudited)

 For the three months ended March 31,
 20222021
Revenue:
Services and other revenue$418,811 $430,337 
Equipment revenue82,723 52,245 
Total revenue501,534 482,582 
Costs and expenses:
Cost of sales - services and other (exclusive of depreciation and amortization)141,129 132,789 
Cost of sales - equipment (exclusive of depreciation and amortization)69,114 45,151 
Selling, general and administrative expenses118,170 114,119 
Research and development expenses7,617 7,545 
Depreciation and amortization120,436 129,286 
Impairment of long-lived assets 230 
Total costs and expenses456,466 429,120 
Operating income (loss)45,068 53,462 
Other income (expense):
Interest income, net6,422 5,949 
Interest expense, net of amounts capitalized(14,973)(34,667)
Gains (losses) on investments, net80,686 78,600 
Equity in earnings (losses) of unconsolidated affiliates, net(1,714)1,374 
Foreign currency transaction gains (losses), net6,394 (4,069)
Other, net(156)(930)
Total other income (expense), net76,659 46,257 
Income (loss) before income taxes121,727 99,719 
Income tax benefit (provision), net(32,782)(22,147)
Net income (loss)88,945 77,572 
Less: Net loss (income) attributable to non-controlling interests2,488 947 
Net income (loss) attributable to EchoStar Corporation common stock$91,433 $78,519 
Earnings (losses) per share - Class A and B common stock:
Basic$1.07 $0.84 
Diluted$1.06 $0.84 

The accompanying notes are an integral part of these Consolidated Financial Statements.
3

ECHOSTAR CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(Amounts in thousands)
(Unaudited)

For the three months ended March 31,
 20222021
Net income (loss)$88,945 $77,572 
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments48,945 (26,197)
Unrealized gains (losses) on available-for-sale securities(567)(86)
Other (6,920)
Amounts reclassified to net income (loss):
Realized losses (gains) on available-for-sale debt securities (7)
Total other comprehensive income (loss), net of tax48,378 (33,210)
Comprehensive income (loss)137,323 44,362 
Less: Comprehensive loss (income) attributable to non-controlling interests(7,068)6,557 
Comprehensive income (loss) attributable to EchoStar Corporation$130,255 $50,919 






























The accompanying notes are an integral part of these Consolidated Financial Statements.
4

ECHOSTAR CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021
(Amounts in thousands)
(Unaudited)

Common
Stock
Additional
Paid-In
Capital
Accumulated
Other
Comprehensive
Income (Loss)
Accumulated
Earnings
(Losses)
Treasury
Shares, at cost
Non-controlling
Interests
Total
Balance, December 31, 2020$105 $3,321,426 $(187,876)$583,591 $(174,912)$64,916 $3,607,250 
Issuances of Class A common stock:       
Employee benefits1 7,124 — — — — 7,125 
Employee Stock Purchase Plan— 2,486 — — — — 2,486 
Stock-based compensation— 2,011 — — — — 2,011 
Contribution by non-controlling interest holder— — — — — 5,400 5,400 
Other comprehensive income (loss)— — (27,600)— — (5,610)(33,210)
Net income (loss)— — — 78,519 — (947)77,572 
Treasury share repurchase— — — — (110,769)— (110,769)
Balance, March 31, 2021$106 $3,333,047 $(215,476)$662,110 $(285,681)$63,759 $3,557,865 
Balance, December 31, 2021$106 $3,345,878 $(212,102)$656,466 $(436,521)$60,253 $3,414,080 
Issuances of Class A common stock:
Employee benefits— 7,041 — — — — 7,041 
Employee Stock Purchase Plan— 2,367 — — — — 2,367 
Stock-based compensation— 1,860 — — — — 1,860 
Issuance of equity and contribution of assets pursuant to the India JV formation— (14,090)— — — 44,393 30,303 
Other comprehensive income (loss)— — 38,822 — — 9,556 48,378 
Net income (loss)— — — 91,433 — (2,488)88,945 
Treasury share repurchase— — — — (35,061)— (35,061)
Balance, March 31, 2022$106 $3,343,056 $(173,280)$747,899 $(471,582)$111,714 $3,557,913 

The accompanying notes are an integral part of these Consolidated Financial Statements.
5

ECHOSTAR CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
(Unaudited)
 For the three months ended March 31,
 20222021
Cash flows from operating activities:
Net income (loss)$88,945 $77,572 
Adjustments to reconcile net income (loss) to cash flows provided by (used for) operating activities:
Depreciation and amortization120,436 129,286 
Impairment of long-lived assets 230 
Losses (gains) on investments, net(80,686)(78,600)
Equity in losses (earnings) of unconsolidated affiliates, net1,714 (1,374)
Foreign currency transaction losses (gains), net(6,394)4,069 
Deferred tax provision (benefit), net25,538 18,370 
Stock-based compensation1,860 2,011 
Amortization of debt issuance costs191 1,118 
Other, net(2,528)11,551 
Changes in assets and liabilities, net:
Trade accounts receivable and contract assets, net(8,480)(6,090)
Other current assets, net(3,340)(1,736)
Trade accounts payable7,046 (18,375)
Contract liabilities(3,142)7,938 
Accrued expenses and other current liabilities(27,033)(27,447)
Non-current assets and non-current liabilities, net(9,774)(1,636)
Net cash provided by (used for) operating activities104,353 116,887 
Cash flows from investing activities:
Purchases of marketable investment securities(88,578)(389,071)
Sales and maturities of marketable investment securities492,812 1,361,632 
Expenditures for property and equipment(112,138)(179,235)
Expenditures for externally marketed software(5,093)(7,846)
India JV formation(7,892) 
Purchase of other investments (50,000)
Sales of other investments 1,500 
Net cash provided by (used for) investing activities279,111 736,980 
Cash flows from financing activities:
Repurchase and maturity of the 2021 Senior Unsecured Notes (62,588)
Payment of finance lease obligations(85)(329)
Payment of in-orbit incentive obligations(1,444)(1,104)
Proceeds from Class A common stock issued under the Employee Stock Purchase Plan2,367 2,486 
Treasury share repurchase(33,307)(107,862)
Contribution by non-controlling interest holder 5,400 
Other, net (292)
Net cash provided by (used for) financing activities(32,469)(164,289)
Effect of exchange rates on cash and cash equivalents3,480 (1,808)
Net increase (decrease) in cash and cash equivalents354,475 687,770 
Cash and cash equivalents, including restricted amounts, beginning of period536,874 896,812 
Cash and cash equivalents, including restricted amounts, end of period$891,349 $1,584,582 

The accompanying notes are an integral part of these Consolidated Financial Statements.
6

ECHOSTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

NOTE 1.    ORGANIZATION AND BUSINESS ACTIVITIES

Principal Business
 
EchoStar Corporation (which, together with its subsidiaries, is referred to as “EchoStar,” the “Company,” “we,” “us” and “our”) is a holding company that was organized in October 2007 as a corporation under the laws of the State of Nevada and has operated as a separately traded public company from DISH Network Corporation (“DISH”) since 2008. Our Class A common stock is publicly traded on the NASDAQ Global Select Market (“NASDAQ”) under the symbol “SATS.”

We are an industry leader in both networking technologies and services, innovating to deliver the global solutions that power a connected future for people, enterprises and things everywhere. We provide broadband satellite technologies, broadband internet services for consumer customers, which include home and small to medium-sized businesses, and satellite services. We also deliver innovative network technologies, managed services and communications solutions for enterprise customers, which include aeronautical and government enterprises. We operate in the following two business segments:
 
Hughes segment — which provides broadband satellite technologies and broadband internet services to domestic and international consumer customers and broadband network technologies, managed services, equipment, hardware, satellite services and communication solutions to service providers and enterprise customers. The Hughes segment also designs, provides and installs gateway and terminal equipment to customers for other satellite systems. In addition, our Hughes segment designs, develops, constructs and provides telecommunication networks comprising satellite ground segment systems and terminals to mobile system operators and our enterprise customers.
Echostar Satellite Services segment (“ESS segment”) — which uses certain of our owned and leased in-orbit satellites and related licenses to provide satellite services on a full-time and/or occasional-use basis to U.S. government service providers, internet service providers, broadcast news organizations, content providers and private enterprise customers.

Our operations also include various corporate departments (primarily Executive, Treasury, Strategic Development, Human Resources, Information Technology, Finance, Accounting, Real Estate and Legal) and other activities, such as costs incurred in certain satellite development programs and other business development activities, and gains or losses from certain of our investments, that have not been assigned to our business segments. These activities, costs and income, as well as eliminations of intersegment transactions, are accounted for in Corporate and Other segment in our segment reporting. We also divide our operations by primary geographic market as follows: (i) North America (the U.S. and its territories, Mexico, and Canada); (ii) South and Central America and (iii) Other (Asia, Africa, Australia, Europe, India, and the Middle East). Refer to Note 15. Segment Reporting for further detail.

NOTE 2.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
Basis of Presentation

These unaudited Consolidated Financial Statements and the accompanying notes (collectively, the “Consolidated Financial Statements”) are prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) and the instructions to Form 10-Q and Article 10 of Regulation S-X for interim financial information. Accordingly, they do not include all of the information and notes required for complete financial statements prepared in conformity with U.S. GAAP. In our opinion, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation have been included. However, our results of operations for the interim periods presented are not necessarily indicative of the results that may be expected for the full year.

All amounts presented in these Consolidated Financial Statements are expressed in thousands of U.S. dollars, except share and per share amounts and unless otherwise noted.

7

ECHOSTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
Refer to Note 2. Summary of Significant Accounting Policies to the Consolidated Financial Statements in our Form 10-K for a summary and discussion of our significant accounting policies, except as updated below.

Use of Estimates
 
We are required to make certain estimates and assumptions that affect the amounts reported in these Consolidated Financial Statements. The most significant estimates and assumptions are used in determining: (i) inputs used to recognize revenue over time, including amortization periods for deferred contract acquisition costs; (ii) allowances for doubtful accounts; (iii) deferred taxes and related valuation allowances, including uncertain tax positions; (iv) loss contingencies; (v) fair value of financial instruments; (vi) fair value of assets and liabilities acquired in business combinations; and (vii) asset impairment testing.

We base our estimates and assumptions on historical experience, observable market inputs and on various other factors that we believe to be relevant under the circumstances. Due to the inherent uncertainty involved in making estimates, actual results may differ from previously estimated amounts and such differences may be material to our financial statements. Additionally, changing economic conditions may increase the inherent uncertainty in the estimates and assumptions indicated above. We review our estimates and assumptions periodically and the effects of revisions thereto are reflected in the period they occur or prospectively if the revised estimate affects future periods.

Principles of Consolidation

We consolidate all entities in which we have a controlling financial interest. We are deemed to have a controlling financial interest in variable interest entities in which we are the primary beneficiary and in other entities in which we own more than 50% of the outstanding voting shares and other shareholders do not have substantive rights to participate in management. For entities we control but do not wholly own, we record a non-controlling interest within stockholders’ equity for the portion of the entity’s equity attributed to the non-controlling ownership interests. All significant intercompany balances and transactions have been eliminated in consolidation.

Recently Adopted Accounting Pronouncements

On January 1, 2021, we adopted Accounting Standard Update (“ASU”) No. 2019-12 - Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”). ASU 2019-12 is part of the Financial Accounting Standards Board (“FASB”) overall simplification initiative and seeks to simplify the accounting for income taxes by updating certain guidance and removing certain exceptions. Our adoption of this ASU did not have a material impact on our Consolidated Financial Statements.

In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance, which requires business entities (except for not-for-profit entities and employee benefit plans) to disclose information about certain government assistance they receive. The Topic 832 disclosure requirements include: (i) the nature of the transactions and the related accounting policy used; (ii) the line items on the balance sheet and income statement that are affected and the amounts applicable to each financial statement line item; and (iii) significant terms and conditions of the transactions. Our adoption of this ASU did not have a material impact on our Consolidated Financial Statements.










8

ECHOSTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
Recently Issued Accounting Pronouncements Not Yet Adopted

In March 2020, the FASB issued ASU No. 2020-04 - Reference Rate Reform (Topic 848), codified as ASC 848 (“ASC 848”). The purpose of ASC 848 is to provide optional guidance to ease the potential effects on financial reporting of the market-wide migration away from Interbank Offered Rates to alternative reference rates. ASC 848 applies only to contracts, hedging relationships, and other transactions that reference a reference rate expected to be discontinued because of reference rate reform. The guidance may be applied upon issuance of ASC 848 through December 31, 2022. We expect to utilize the optional expedients provided by the guidance for contracts amended solely to use an alternative reference rate. We have evaluated the impact of adopting this new guidance and do not expect it to have a material impact on our Consolidated Financial Statements.

In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which provides an exception to fair value measurement for contract assets and contract liabilities related to revenue contracts acquired in a business combination. The ASU requires an entity (acquirer) to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606. At the acquisition date, an acquirer should account for the related revenue contracts in accordance with Topic 606 as if it had originated the contracts. The ASU is effective for the Company for annual and interim periods in fiscal years beginning after December 15, 2023. Early adoption is permitted. The ASU is applied to business combinations occurring on or after the effective date.

In March 2022, the FASB issued ASU 2022-02, Financial Instruments - Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures. The amendments in this update eliminate the accounting guidance for troubled debt restructurings by creditors while enhancing disclosure requirements for certain loan refinancing and restructurings by creditors made to borrowers experiencing financial difficulty. The amendments also require disclosure of current-period gross write-offs by year of origination for financing receivables. The amendments in this update are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted. We are evaluating the impact of adopting this new guidance on our Consolidated Financial Statements.

NOTE 3.     REVENUE RECOGNITION

Contract Balances

The following table presents the components of our contract balances:
 As of
March 31, 2022December 31, 2021
Trade accounts receivable and contract assets, net:
Sales and services$160,325 $154,676 
Leasing5,722 5,668 
Total trade accounts receivable166,047 160,344 
Contract assets49,783 36,307 
Allowance for doubtful accounts(16,524)(14,588)
Total trade accounts receivable and contract assets, net$199,306 $182,063 
Contract liabilities:
Current$138,201 $141,343 
Non-current10,292 10,669 
Total contract liabilities$148,493 $152,012 

9

ECHOSTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
The following table presents the revenue recognized in the Consolidated Statements of Operations that was previously included within contract liabilities:

For the three months ended March 31,
20222021
Revenue$88,947 $63,081 
Contract Acquisition Costs

The following table presents the activity in our contract acquisition costs, net:

For the three months ended March 31,
20222021
Balance at beginning of period$82,986 $99,837 
Additions15,788 18,400 
Amortization expense(20,197)(22,769)
Foreign currency translation1,995 (875)
Balance at end of period$80,572 $94,593 

Performance Obligations

As of March 31, 2022, the remaining performance obligations for our customer contracts with original expected durations of more than one year was $890.4 million. Performance obligations expected to be satisfied within one year and greater than one year are 48.0% and 52.0%, respectively. This amount and percentages exclude agreements with consumer customers in our Hughes segment, our leasing arrangements and agreements with certain customers under which collectability of all amounts due through the term of contracts is uncertain.

Disaggregation of Revenue

Geographic Information

The following tables present our revenue from customer contracts disaggregated by primary geographic market and by segment:
HughesESSCorporate and OtherConsolidated
Total
For the three months ended March 31, 2022
North America$399,422 $4,474 $2,947 $406,843 
South and Central America42,872   42,872 
Other51,812  7 51,819 
Total revenue$494,106 $4,474 $2,954 $501,534 
For the three months ended March 31, 2021
North America$398,759 $4,089 $2,612 $405,460 
South and Central America43,030   43,030 
Other34,070  22 34,092 
Total revenue$475,859 $4,089 $2,634 $482,582 

10

ECHOSTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
Nature of Products and Services

The following tables present our revenue disaggregated by the nature of products and services and by segment:
HughesESSCorporate and OtherConsolidated
Total
For the three months ended March 31, 2022
Services and other revenue:
Services$400,402 $2,935 $1,519 $404,856 
Lease revenue10,987 1,539 1,429 13,955 
Total services and other revenue411,389 4,474 2,948 418,811 
Equipment revenue:
Equipment25,885  6 25,891 
Design, development and construction services55,905   55,905 
Lease revenue927   927 
Total equipment revenue82,717  6 82,723 
Total revenue$494,106 $4,474 $2,954 $501,534 
For the three months ended March 31, 2021
Services and other revenue:
Services$413,519 $2,690 $1,091 $417,300 
Lease revenue10,101 1,399 1,537 13,037 
Total services and other revenue423,620 4,089 2,628 430,337 
Equipment revenue:
Equipment28,521  6 28,527 
Design, development and construction services21,636   21,636 
Lease revenue2,082   2,082 
Total equipment revenue52,239  6 52,245 
Total revenue$475,859 $4,089 $2,634 $482,582 

Lease Revenue

The following table presents our lease revenue by type of lease:
For the three months ended March 31,
20222021
Sales-type lease revenue:
Revenue at lease commencement$638 $2,082 
Interest income289 73 
Total sales-type lease revenue927 2,155 
Operating lease revenue13,955 12,964 
Total lease revenue$14,882 $15,119 

11

ECHOSTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
NOTE 4.    BUSINESS COMBINATIONS

In May 2019, we entered into an agreement with Bharti Airtel Limited (“BAL”) and its subsidiary, Bharti Airtel Services Limited (together with BAL, “Bharti”), pursuant to which Bharti agreed to contribute its very small aperture terminal (“VSAT”) telecommunications services and hardware business in India to Hughes Communications India Private Limited (“HCIPL”) and its subsidiaries, our less than wholly owned Indian subsidiaries, that conduct our VSAT services and hardware business in India. On January 4, 2022, this joint venture was formed (the “India JV”) and subsequent to the formation of the India JV, we hold a 67% ownership interest and Bharti holds a 33% ownership interest in HCIPL. The India JV combines the VSAT businesses of both companies to offer flexible and scalable enterprise networking solutions using satellite connectivity for primary transport, back-up and hybrid implementation in India. The results of operations related to the India JV have been included in these Consolidated Financial Statements from the date of formation. The costs associated with the closing of the India JV were not material and were expensed as incurred.

The fair value of the consideration transferred was $38.2 million. Net cash paid was $7.9 million, inclusive of amounts paid for the acquisition of, or of HCIPL shares from, entities that were shareholders of HCIPL prior to closing the India JV.

All assets and liabilities acquired in the India JV formation have been recorded at fair value. The following table presents our preliminary allocation of the purchase price:
Amounts
Assets:
Trade accounts receivable and contract assets, net$6,160 
Other current assets2,085 
Property and equipment4,669 
Goodwill23,086 
Other intangible assets4,428 
Total assets$40,428 
Liabilities:
Trade accounts payable$133 
Accrued expenses and other current liabilities986 
Deferred tax liabilities 1,114 
Total liabilities$2,233 
Total purchase price $38,195 

The preliminary valuation of assets acquired and liabilities assumed in the India JV were derived using primarily unobservable Level 3 inputs, which require significant management judgment and estimation, and resulted in a customer relationship intangible of $4.4 million with an estimated life of 5 years and is reported in Other intangible assets, net.
Goodwill associated with the India JV is attributable to expected synergies, the projected long-term business growth in current and new markets and an assembled workforce. Goodwill has been allocated entirely to our Hughes segment.

12

ECHOSTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
NOTE 5.    EARNINGS PER SHARE 

The following table presents the calculation of basic and diluted EPS for our Class A and B common stock:
 For the three months ended March 31,
 20222021
Net income (loss) attributable to EchoStar Corporation common stock$91,433 $78,519 
Weighted-average common shares outstanding:
Basic85,846 93,871 
Dilutive impact of stock awards outstanding33 25 
Diluted85,879 93,896 
Earnings (losses) per share:
Basic$1.07 $0.84 
Diluted$1.06 $0.84 

The following table presents the number of anti-dilutive options to purchase shares of our Class A common stock which have been excluded from the calculation of our weighted-average common shares outstanding:

For the three months ended March 31,
20222021
Number of shares4,6504,750

NOTE 6.    MARKETABLE INVESTMENT SECURITIES
 
The following table presents our Marketable investment securities:
 As of
 March 31, 2022December 31, 2021
Marketable investment securities:
Available-for-sale debt securities:
Corporate bonds$194,074 $289,784 
Commercial paper221,670 498,358 
Other debt securities45,950 92,673 
Total available-for-sale debt securities461,694 880,815 
Equity securities186,226 142,943 
Total marketable investment securities, including restricted amounts647,920 1,023,758 
Less: Restricted marketable investment securities(13,327)(13,262)
Total marketable investment securities$634,593 $1,010,496 

13

ECHOSTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(Unaudited)
Debt Securities
 
Available-for-Sale 

The following table presents the components of our available-for-sale debt securities:
 AmortizedUnrealizedEstimated
 CostGainsLossesFair Value
As of March 31, 2022    
Corporate bonds$194,877 $ $(803)$194,074 
Commercial paper221,670   221,670 
Other debt securities46,169  (219)45,950 
Total available-for-sale debt securities$462,716 $ $(1,022)$461,694 
As of December 31, 2021    
Corporate bonds$290,169 $ $(385)$289,784 
Commercial paper498,358   498,358