How Did Subscribers Boost Sirius XM In Q3?
The third quarter proved to be a powerful one for Sirius XM Holdings, as net income increased from $166.6 million (3 cents per share) to $193.9 million (4 cents).
Revenue climbed from $1.17 billion to $1.28 billion.
Sirius XM subscribers are directly responsible for the boost.
Subscriber revenue topped the $1 billion mark — landing at precisely $1.07 billion in Q3. That compares to $974.5 million in the same period a year earlier.
With net income up from $375.1 million to $541.3 million and cash on hand of $572.4 million, compared to $152.6 million, Sirius XM met Wall Street expectations with flying colors.
Five analysts surveyed by Zacks expected revenue of $1.26 billion.
The average estimate of 10 analysts surveyed by Zacks Investment Research was also for earnings of 4 cents per share.
“SiriusXM’s performance in the third quarter was exemplary,” said Sirius XM CEO Jim Meyer. “We grew self-pay subscribers by 385,000 and turned in record quarterly high levels of revenue and adjusted EBITDA … In short, our business is operating more efficiently than ever before, and we are pleased to increase our revenue and adjusted EBITDA guidance for the second time this year.”
Sirius XM now anticipates FY 2016 revenue of approximately $5 billion and adjusted EBITDA to reach approximately $1.85 billion. Sirius XM’s 2016 guidance for continued growth in total subscribers, self-pay subscribers, and free cash flow remains unchanged.
The company’s full-year 2016 guidance is as follows:
- Net self-pay subscriber additions of approximately 1.6 million
- Total net subscriber additions of approximately 1.7 million
- Revenue of approximately $5 billion
- Adjusted EBITDA of approximately $1.85 billion
- Free cash flow approaching $1.5 billion
DIVIDEND COMES WITH ADDITIONAL SHARE BUYBACK
Sirius XM also announced Thursday (Oct. 27) that its Board of Directors declared its first quarterly dividend in the amount of 1 cent per share of common stock, payable on Nov. 30 to shareholders of record at the end of trading on Nov. 9. Additionally, Sirius XM is instituting a quarterly dividend on its common stock of 4 cents per share.
Furthermore, the Sirius XM board approved an additional $2 billion of share repurchases, bringing Sirius XM’s total repurchase authorization to $10 billion.
SiriusXM has already repurchased an aggregate of $7.6 billion of common stock under its stock repurchase program.
Sirius shares were off 13 cents, to $4.11, on Thursday.