Acquisition Target Sirius XM's Subscriber and Advertising Revenue Shows Stability in Q3, Reaffirms Annual Outlook

Sirius XM Holdings Inc SIRI reported a flat third-quarter FY23 revenue growth year-on-year to $2.27 billion, marginally missing the consensus of $2.29 billion. Adjusted EPS of $0.09 beat the consensus of $0.08. 

Subscriber revenue growth remained flattish Y/Y at $1.73 billion. Advertising revenue remained steady Y/Y at $460 million.

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SiriusXM self-pay subscribers decreased by 96,000 to 34 million total subscribers, flat Y/Y. Self-pay monthly churn remained low at 1.6%.

SiriusXM segment revenue was down 1% Y/Y to $1.7 billion as ARPU remained firm at $15.69. The gross margin declined from 62% to 61% Y/Y.

Pandora segment advertising revenue increased 3% Y/Y to $418 million. 

Monthly Active Users (MAUs) at Pandora were 46.5 million, down from 48.8 million in the prior year. 

Total ad-supported listener hours were 2.64 billion, down from 2.75 billion Y/Y.

The gross margin improved to 33% from 32% a year ago.

Sirius generated $291 million in free cash flow in the third quarter, down from $329 million in the prior year. It held $53 million in cash and equivalents.

FY23 Outlook: Sirius XM reiterated revenue outlook of $9.0 billion, in line with the consensus. It also maintained an adjusted EBITDA of $2.75 billion.

Price Action: SIRI shares traded higher by 4.90% at $4.39 on the last check Tuesday.