The company has reported a nearly 21% decline in after-tax profit to $116 million.
Revenue for the year to June declined 3.7% to $893.4 million, earnings before interest and tax (ebit) declined 16.8% to $187.2million and after-tax profit plunged 20.9% from $147.1 million last year to $116 million.
Subscriptions make up the lion's share of Sky's revenue. Residential MySky declined 4.2% to $567.9million and residential digital declined 1.9% to $157.2 million, an overall 3% subscription decline to $807.3 million.
Craigs Investment Partners broker Peter McIntyre said the result was better than expected by analysts, but probably held up by the positive impact of the Lions rugby tour, which put subscriptions up by 9000 and programming costs in decline.
However, several key challenges and negative trends were continuing for Sky TV. ''High-value satellite subscribers'' fell by 33,000, or 5%, on a year ago. Programme costs were likely to remain elevated, having been up 6% to 349 million for full-year 2017.
Sky's dividend was down 8.3% from 27.5c last year to 30c. Following the announcement, its shares shed 2.5% value, trading down to $3.10.
Forsyth Barr broker Suzanne Kinnaird said earnings were ahead of expectations, mainly due to lower programming costs than expected, and despite revenue being down.
However, the detail provided by Sky showed the composition of subscribers was deteriorating as the number of satellite customers fell.
''Despite operating earnings being ahead of our expectation, there is nothing in the result to materially change our investment view ... with concerns about escalating competition for audiences and content,'' Mrs Kinnaird said.
Sky TV chief executive John Fellet highlighted the purchase and screening of ''prestige drama'', with 455 series on offer globally this year and potentially 534 series next year, such as Game of Thrones, Fargo, Doctor Who, Twin Peaks and The Leftovers.
Sky faces increased rivalry from online streaming video services such as Netflix.
Mr Fellet said traditional television was still the most dominant viewing platform but there was a ''transition'' under way and ''video on demand'' services were the way of the future.
He said Sky had ''embraced'' video on demand, launching My Sky, which converts traditional content to video, and its more recent Neon, Fan Pass and Sky on Demand services.
Sky's costs to secure programming rights increased 5.6% to $349.4 million in the latest year, equating to 39.1% of revenue from 35.7% a year earlier, BusinessDesk reported. Meanwhile, its subscriber numbers fell 3.3% to 824,782, with residential subscription revenue down 3.7% to $725.1million.
Increased subscribers for its video on demand service Neon and sports service Fan Pass helped ''other subscription revenue'', which rose 3.7% to $82.2 million.
- Additional reporting BusinessDesk
