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Sirius Satellite Radio and XM Satellite Radio have both reported strong third quarter results.
Sirius’s revenue increased 150 percent year over year, to $167.1 million, according to the company. Cost to acquire a subscriber dropped 23 percent, and Sirius’s third quarter adjusted loss from operations decreased 21 percent year over year.
Meanwhile, XM Satellite Radio saw third quarter revenue increase 57 percent year over year, while cost to acquire a subscriber grew from $53 in Q3 05 to $60 in the third quarter of this year. Net loss was reduced by 36 percent.
XM added more than 2.8 million subscribers this year to date. According to Hugh Panero, CEO of XM, the “significant revenue growth” and narrowing losses mean the company is on track for positive cash flow from operations in the fourth quarter of this year.
XM finished the third quarter 2006 with a total of 7,185,873 subscribers, representing a 43 percent increase over the number of subscribers at the end of the Q3 ‘05. For the third quarter 2006, XM recorded net subscriber additions of 286,002.
Sirius ended the third quarter with 5,119,308 subscribers, 135 percent above third quarter 2005 ending subscribers. During the third quarter of 2006, Sirius added 441,101 net subscribers, a 23 percent increase over third quarter 2005 net subscriber additions.
For the fourth consecutive quarter, Sirius led the satellite radio industry in net subscriber additions, capturing 61 percent of total satellite radio net additions in the third quarter.
Sirius CEO Mel Karmazin attributed the success to excellence in programming and solid execution of the company’s business plan. New initiatives helping to drive growth included: the launch of Sirius Internet Radio; the launch of the Stiletto 100, the industry’s first portable satellite radio with WiFi capabilities; a channel devoted to legendary rock superstars The Who; a multi-year agreement with The Metropolitan Opera; an agreement with Chelsea Football Club which makes Sirius the satellite provider of Chelsea soccer matches; and increasing momentum in the automotive OEM channel.
XM attributed growth the expanding its position as “the leading provider of satellite radio for the automobile industry,” pointing out recent agreements with such automakers as Porsche, Acura, Hyundai, Lexus and GM.
XM also recently launched its Oprah Winfrey channel, “Oprah & Friends,” and rolled out a new fall marketing campaign across network and cable television, print, interactive, direct marketing, retail and automotive channels in October.
It also recently announced an agreement with Cingular Wireless to stream 25 XM music channels to Cingular handsets.
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