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Financial life is looking good for EchoStar Communications Corporation. The Littleton, CO-based direct broadcast satellite operator reported second-quarter profits of $45.8 million, with revenue up 21%, to $1.17 billion. EchoStar's subscribership increased by 295,000 during the quarter, and the company is predicting that it could add more than 1.2 million new subscribers to its DISH network in 2002, with a total approaching eight million by year's end. EchoStar reported the results August 15.

For same period last year, EchoStar posted a net loss of $5.9 million on revenue of $966.3 million. The most recent quarterly report was EchoStar's first profitable one since its initial public offering in 1995. News of the company's good fortune boosted its value on the stock market, with an 11% rise to $17/share as of the closing of the NASDAQ on the 15th.

EchoStar has benefited from joint marketing deals with RadioShack Corporation and retail giant Wal-Mart, Inc. While the current financial picture is rosy, EchoStar is having problems on other fronts. Its long campaign to acquire competitor DirecTV from General Motors-owned Hughes Electronics may come to naught, with federal regulators reportedly less enthusiastic about the merger now than they were last year.

Further cloudiness: EchoStar is also under investigation by attorneys general from at least 10 states, who are probing possible violations of consumer-protection laws, including customer service response times, and delays in providing refunds for subscription cancellations. Several state officials have come out against the DBS merger, saying it will ultimately cost rural consumers far more than they pay now for essentially the same services. EchoStar's subscriber growth and improving financial base may make the merger less attractive than it was in the age of negative numbers, some analysts have said. Federal regulators may make a decision on the merger by the end of the year.