XM Posts Slower Subscriber Growth for 2Q
Thursday July 6, 4:33 pm ET
By Seth Sutel, AP Business Writer
XM Reports Slower Growth in New Subscribers for 2nd Quarter; Sirius Tops Analysts' Expectations NEW YORK (AP) -- XM Satellite Radio Holdings Inc. reported slower growth in new subscribers for the second quarter Thursday, which the company attributed to problems with product availability and softness in retail sales.
Sirius Satellite Radio Inc., meanwhile, added far more subscribers than XM in the second quarter, beating analysts expectations and continuing to benefit from signing up the popular shock jock Howard Stern, who went on the air at the beginning of the year.
XM said it added 398,000 net subscribers in the second quarter, well below the 568,900 it added in the first quarter, leaving it with 6.89 million subscribers to date. Analysts had been looking for about 430,000 net additions, Oppenheimer analyst Thomas Eagan said.
Sirius said it added 600,460 subscribers, ending the quarter with 4.7 million. While that was down from the staggering 761,000 additions made in the first quarter, shortly after Stern joined Sirius, Eagan said the pace was still strong in the second quarter and reflected a continuation of "the Howard effect."
Analysts had been expecting 555,000 additions for Sirius, Eagan said. A Sirius spokesman declined to comment on the figures beyond a prepared statement.
XM's stock fell 38 cents, or 2.6 percent, to close at $14.11 on the Nasdaq Stock Market while Sirius' shares rose 5 cents, or 1.1 percent, to finish at $4.53.
In May, XM cut its estimates for full-year subscriber growth, citing softness in retail sales of satellite radios and product availability problems. XM currently estimates having 8.5 million subscribers by the end of the year, down from its previous estimate of 9 million.
Sirius said in late May that it expects to meet its previously issued forecast of getting to more than 6.2 million subscribers by the end of 2006.
XM's stock is down 48 percent since the beginning of the year on a variety of concerns, including the sudden departure of a director over strategic differences with the company; an investigation into the company's marketing practices and more recently the reduction of subscriber estimates. Sirius shares are also down, but not as much, about 32 percent, since the beginning of the year.
XM is locked in a fierce battle with Sirius to sign up programming talent and paying subscribers. Both services are available nationally, carry dozens of channels of talk and commercial-free music, and cost about $13 per month.
Eagan, the Oppenheimer analyst, said that despite several external difficulties for the two satellite radio stocks, long-term subscriber goals would likely be met as more cars are installed with the receivers at the factory. Sanford Bernstein analyst Craig Moffett told clients in a note that he also expects "rapid growth" in factory installation rates from 2007 to 2009.
Source:http://biz.yahoo.com/ap/060706/satellite_radio_subscribers.html?.v=7
Thursday July 6, 4:33 pm ET
By Seth Sutel, AP Business Writer
XM Reports Slower Growth in New Subscribers for 2nd Quarter; Sirius Tops Analysts' Expectations NEW YORK (AP) -- XM Satellite Radio Holdings Inc. reported slower growth in new subscribers for the second quarter Thursday, which the company attributed to problems with product availability and softness in retail sales.
Sirius Satellite Radio Inc., meanwhile, added far more subscribers than XM in the second quarter, beating analysts expectations and continuing to benefit from signing up the popular shock jock Howard Stern, who went on the air at the beginning of the year.
XM said it added 398,000 net subscribers in the second quarter, well below the 568,900 it added in the first quarter, leaving it with 6.89 million subscribers to date. Analysts had been looking for about 430,000 net additions, Oppenheimer analyst Thomas Eagan said.
Sirius said it added 600,460 subscribers, ending the quarter with 4.7 million. While that was down from the staggering 761,000 additions made in the first quarter, shortly after Stern joined Sirius, Eagan said the pace was still strong in the second quarter and reflected a continuation of "the Howard effect."
Analysts had been expecting 555,000 additions for Sirius, Eagan said. A Sirius spokesman declined to comment on the figures beyond a prepared statement.
XM's stock fell 38 cents, or 2.6 percent, to close at $14.11 on the Nasdaq Stock Market while Sirius' shares rose 5 cents, or 1.1 percent, to finish at $4.53.
In May, XM cut its estimates for full-year subscriber growth, citing softness in retail sales of satellite radios and product availability problems. XM currently estimates having 8.5 million subscribers by the end of the year, down from its previous estimate of 9 million.
Sirius said in late May that it expects to meet its previously issued forecast of getting to more than 6.2 million subscribers by the end of 2006.
XM's stock is down 48 percent since the beginning of the year on a variety of concerns, including the sudden departure of a director over strategic differences with the company; an investigation into the company's marketing practices and more recently the reduction of subscriber estimates. Sirius shares are also down, but not as much, about 32 percent, since the beginning of the year.
XM is locked in a fierce battle with Sirius to sign up programming talent and paying subscribers. Both services are available nationally, carry dozens of channels of talk and commercial-free music, and cost about $13 per month.
Eagan, the Oppenheimer analyst, said that despite several external difficulties for the two satellite radio stocks, long-term subscriber goals would likely be met as more cars are installed with the receivers at the factory. Sanford Bernstein analyst Craig Moffett told clients in a note that he also expects "rapid growth" in factory installation rates from 2007 to 2009.
Source:http://biz.yahoo.com/ap/060706/satellite_radio_subscribers.html?.v=7
