Sirius XM Posts $3B 2Q Profit on Tax Gain

By Jennifer Booton Features FOXBusiness

(Sirius XM)

Led by higher prices and subscriber growth, Sirius XM Radio (SIRI) reported a stronger second-quarter profit that met Wall Street expectations, sending its shares 2% higher Tuesday. 

Continue Reading Below

The satellite radio provider reported net income of $3.1 billion, or 48 cents a share, led by a $3 billion income tax benefit, compared with a year-earlier $173 million, or 3 cents. Excluding the one-time benefit, the Pandora (P) rival earned 2 cents a share, matching average analyst estimates in a Thomson Reuters poll.

Revenue for the three-month period was up 13% to $838 million from $744 million a year ago, topping the Street’s view of $834 million. Subscriber revenue as well as advertising and agency fees both grew more than 12% to $730 million and $20.7 million, respectively.  

Self-pay net subscriber additions improved by 28% year-over-year to 463,000, pushing the self-pay subscriber base to an all-time high of 18.7 million. The total paid subscriber base rose to a high of 22.9 million.

SiriusXM raised its prices for the basic package for first time ever earlier this year to $14.49 a month from $12.95.

“SiriusXM continued its exceptional performance in the second quarter, adding over 600,000 subscribers, which represents a post-merger record, despite the mixed macroeconomic trends,” chief executive, Mel Karmazin, said in a statement. “We have grown revenue, tightly controlled expenses, and produced substantial growth in adjusted EBITDA and free cash flow.”

Continue Reading Below

Reflecting the upbeat trends, SiriusXM lifted its fiscal 2012 revenue forecast to $3.4 billion and new subscriber growth of 1.6 million. Analysts are looking for full-year sales of $3.38 billion.