Sirius XM Holdings ( SIRI Quick Quote SIRI - Free Report) reported fourth-quarter 2020 earnings of 7 cents per share that beat the Zacks Consensus Estimate by 40% and also increased by the same percentage year over year. Total revenues on a reported basis increased 6.2% year over year to $2.19 billion. The figure beat the consensus mark by 5.7%. On a pro-forma basis, revenues also increased 6.2% year over year. Subscriber revenues (73.8% of total revenues) rose 2.9% from the year-ago quarter to $1.62 billion. Meanwhile, advertisement revenues (21.7%) increased 17.6% year over year to $474 million. Equipment revenues (2.7% of total revenues) surged 30.4% year over year to $60 million. Other revenues (1.8% of total revenues) decreased 9.1% from the year-ago quarter to $40 million. Sirius XM Standalone Details
Sirius XM segment pro-forma revenues were $1.63 billion, up 2.4% year over year. While the subscriber base declined 0.6%, the company witnessed growth of 2.1% in ARPU, which was $14.33.
Self-pay subscribers increased 3% year over year to 30.89 million. The company added 279K net self-pay subscribers in the reported quarter. Total subscribers were 34.71 million at the end of fourth-quarter 2020, less than 34.91 million at the end of fourth-quarter 2019. Sirius XM traffic users stayed at 9.301 million. However, Canada subscribers decreased 3% to 2.622 million. Additionally, average self-pay monthly churn rate was 1.6% in the fourth quarter, down 10 basis points (bps) year over year. Subscriber revenues rose 2.6% year over year to $1.49 billion. Moreover, Equipment revenues increased 30.4% year over year to $60 million. However, advertising revenues were $49 million, down 12.5% year over year. Other revenues declined 13% year over year to $40 million. Pandora Details
Pandora’s pro-forma revenues increased 17.1% year over year to $555 million owing to 22.1% growth in advertising revenues, which totaled $425 million. Subscriber revenues climbed 3.2% year over year to $130 million.
The growth in ad revenues was due to increase in fourth-quarter monetization to $112.71 per thousand hours, up 19.2% year over year. However, ARPU decreased 1.3% year over year to $6.67. Monthly active users were 58.88 million at the end of the reported quarter, down from 63.51 million in the year-ago quarter. Ad-supported listener hours declined 7.8% year over year to 2.96 billion. Pandora exited the fourth quarter with 6.341 million self-pay subscribers, up 2% year over year. Operating Details
In the fourth quarter, total operating expenses increased 61.9% year over year to $2.69 billion.
Revenue share and royalty costs were up 9.1% year over year to $662 million. Programming & content costs were $130 million, up 4.8%. Cost of equipment declined 33.3% year over year to $6 million. Customer service & billing costs declined 0.8% year over yearat $122 million. Transmission costs declined 9.4% year over year to $48 million. Subscriber acquisition costs decreased 7.9% year over year to $105 million. General and administrative costs increased 6.2% to $154 million. Engineering, design and development expenses decreased 9.5% from the year-ago quarter to $67 million. Sales and marketing expenses increased 1.4% to $293 million. Adjusted EBITDA increased 12.4% year over year to $660 million. Balance Sheet
As of Dec 31, 2020, cash and cash equivalents were $71 million compared with $44 million as of Sep 30, 2020. The company had $1.749 billion available for future borrowing under its revolving credit facility.
Long-term debt, as of Sep 30, 2020, was $8.5 billion compared with $7.85 billion as of Sep 30, 2020. At the end of the fourth quarter, Sirius XM’s net debt to trailing 12-month adjusted EBITDA ratio was 3.3 times. 2021 Guidance
Revenues are expected to be $8.35 billion. Adjusted EBITDA is expected to be $2.575 billion.
The company anticipates adding almost 800K Sirius XM self-pay net subscribers in 2021. Free cash flow is expected to be $1.6 billion. Zacks Rank & Other Stocks to Consider
Currently, Sirius XM carries a Zacks Rank #3 (Hold).
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