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Why Is Sirius XM (SIRI) Down 7.7% Since Last Earnings Report?
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It has been about a month since the last earnings report for Sirius XM (SIRI - Free Report) . Shares have lost about 7.7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Sirius XM due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Sirius XM Q2 Earnings Match Estimates, Revenues Miss
Sirius XM Holdings reported second-quarter 2023 earnings of 8 cents per share, which matched the Zacks Consensus Estimate and increased 14.3% year over year.
Total revenues on a reported basis declined 0.1% year over year to $2.25 billion and missed the consensus mark by 0.14%.
Subscriber revenues (76.7% of total revenues) gained 0.3% from the year-ago quarter to $1.72 billion but missed the Zacks consensus estimate by 0.86%.
Meanwhile, advertisement revenues (19.8%) declined 1.5% year over year to $445 million. The figure beat the Zacks consensus estimate by 3.5%.
Equipment revenues (2.1% of total revenues) increased 4.4% year over year to $47 million and beat the Zacks consensus estimate by 2.9%. Other revenues (1.5% of total revenues) decreased 10.5% from the year-ago quarter to $33 million and missed the Zacks consensus estimate by 6.06%.
Sirius XM Standalone Details
Sirius XM segment revenues (76.5% of total revenues) were $1.72 billion, up 0.2% year over year. SIRI continued to expand its footprint in the EV market, with the service currently widely available in 49 different EV models sold in the U.S. market.
Total subscriber base remained flat year over year at 34.04 million, beating the Zacks consensus estimate by 0.19%.
Revenues witnessed growth due to a 0.3% improvement in average revenue per user, which amounted to $15.66. The figure missed the Zacks consensus estimate by 1.51%.
Subscriber revenues increased 0.6% year over year to $1.59 billion. Advertising revenues were $45 million, down 8.2% year over year. Equipment revenues gained 4.4% year over year to $47 million. Other revenues decreased 10.8% year over year to $33 million.
Self-pay subscribers increased 3% year over year to 31.9 million. Net subscriber additions decreased 70.1% year over year to 23K in the reported quarter. Sirius XM Canada subscribers grew by 54K year over year to 2.62 million.
Pandora & OFF Platform Details
Pandora and OFF platform’s revenues (23.5% of total revenues) declined 1.1% year over year to $528 million owing to a 0.7% decrease in advertising revenues that totaled $400 million and subscriber revenues that declined 2.3% year over year to $128 million.
Self-pay subscribers of the Pandora Plus and Pandora Premium services decreased modestly in the second quarter of 2023 to end the period at 6.2 million.
Total subscribers decreased by 1.4% year-over-year, ending the second quarter at 6.22 million compared to 6.31 million in the 2022 period. The figure beat the Zacks consensus estimate by 0.4%.
Total ad-supported listener hours were 2.73 billion in the second quarter, down 3.9% year over year. Advertising revenue per thousand listener hours were $97.13 in the second quarter, down 2.6% year over year.
Operating Details
In the second quarter, total operating expenses increased 0.8% year over year to $1.77 billion. Adjusted EBITDA increased 3.4% year over year to $702 million.
Balance Sheet & Cash Flow
As of Jun 30, 2023, cash and cash equivalents were $51 million compared with $53 million as of Mar 31, 2023.
The long-term debt, as of Jun 30, 2023, was $8.9 billion compared with $9.39 billion as of Mar 31, 2023.
For the second quarter, cash flow from operations was $801 million compared with $888 million in the year-ago quarter. Free cash flow was $323 million for the second quarter of 2023, down from $435 million in the prior-year period.
2023 Guidance
Revenues are expected to be $9 billion. Adjusted EBITDA is expected to be $2.75 billion. Free cash flow is expected to be $1.15 billion.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
VGM Scores
Currently, Sirius XM has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions has been net zero. Notably, Sirius XM has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Sirius XM belongs to the Zacks Broadcast Radio and Television industry. Another stock from the same industry, Netflix (NFLX - Free Report) , has gained 1.2% over the past month. More than a month has passed since the company reported results for the quarter ended June 2023.
Netflix reported revenues of $8.19 billion in the last reported quarter, representing a year-over-year change of +2.7%. EPS of $3.29 for the same period compares with $3.20 a year ago.
For the current quarter, Netflix is expected to post earnings of $3.48 per share, indicating a change of +12.3% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.1% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Netflix. Also, the stock has a VGM Score of B.
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Why Is Sirius XM (SIRI) Down 7.7% Since Last Earnings Report?
It has been about a month since the last earnings report for Sirius XM (SIRI - Free Report) . Shares have lost about 7.7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Sirius XM due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Sirius XM Q2 Earnings Match Estimates, Revenues Miss
Sirius XM Holdings reported second-quarter 2023 earnings of 8 cents per share, which matched the Zacks Consensus Estimate and increased 14.3% year over year.
Total revenues on a reported basis declined 0.1% year over year to $2.25 billion and missed the consensus mark by 0.14%.
Subscriber revenues (76.7% of total revenues) gained 0.3% from the year-ago quarter to $1.72 billion but missed the Zacks consensus estimate by 0.86%.
Meanwhile, advertisement revenues (19.8%) declined 1.5% year over year to $445 million. The figure beat the Zacks consensus estimate by 3.5%.
Equipment revenues (2.1% of total revenues) increased 4.4% year over year to $47 million and beat the Zacks consensus estimate by 2.9%. Other revenues (1.5% of total revenues) decreased 10.5% from the year-ago quarter to $33 million and missed the Zacks consensus estimate by 6.06%.
Sirius XM Standalone Details
Sirius XM segment revenues (76.5% of total revenues) were $1.72 billion, up 0.2% year over year. SIRI continued to expand its footprint in the EV market, with the service currently widely available in 49 different EV models sold in the U.S. market.
Total subscriber base remained flat year over year at 34.04 million, beating the Zacks consensus estimate by 0.19%.
Revenues witnessed growth due to a 0.3% improvement in average revenue per user, which amounted to $15.66. The figure missed the Zacks consensus estimate by 1.51%.
Subscriber revenues increased 0.6% year over year to $1.59 billion. Advertising revenues were $45 million, down 8.2% year over year. Equipment revenues gained 4.4% year over year to $47 million. Other revenues decreased 10.8% year over year to $33 million.
Self-pay subscribers increased 3% year over year to 31.9 million. Net subscriber additions decreased 70.1% year over year to 23K in the reported quarter. Sirius XM Canada subscribers grew by 54K year over year to 2.62 million.
Pandora & OFF Platform Details
Pandora and OFF platform’s revenues (23.5% of total revenues) declined 1.1% year over year to $528 million owing to a 0.7% decrease in advertising revenues that totaled $400 million and subscriber revenues that declined 2.3% year over year to $128 million.
Self-pay subscribers of the Pandora Plus and Pandora Premium services decreased modestly in the second quarter of 2023 to end the period at 6.2 million.
Total subscribers decreased by 1.4% year-over-year, ending the second quarter at 6.22 million compared to 6.31 million in the 2022 period. The figure beat the Zacks consensus estimate by 0.4%.
Total ad-supported listener hours were 2.73 billion in the second quarter, down 3.9% year over year. Advertising revenue per thousand listener hours were $97.13 in the second quarter, down 2.6% year over year.
Operating Details
In the second quarter, total operating expenses increased 0.8% year over year to $1.77 billion. Adjusted EBITDA increased 3.4% year over year to $702 million.
Balance Sheet & Cash Flow
As of Jun 30, 2023, cash and cash equivalents were $51 million compared with $53 million as of Mar 31, 2023.
The long-term debt, as of Jun 30, 2023, was $8.9 billion compared with $9.39 billion as of Mar 31, 2023.
For the second quarter, cash flow from operations was $801 million compared with $888 million in the year-ago quarter. Free cash flow was $323 million for the second quarter of 2023, down from $435 million in the prior-year period.
2023 Guidance
Revenues are expected to be $9 billion. Adjusted EBITDA is expected to be $2.75 billion. Free cash flow is expected to be $1.15 billion.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
VGM Scores
Currently, Sirius XM has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions has been net zero. Notably, Sirius XM has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Sirius XM belongs to the Zacks Broadcast Radio and Television industry. Another stock from the same industry, Netflix (NFLX - Free Report) , has gained 1.2% over the past month. More than a month has passed since the company reported results for the quarter ended June 2023.
Netflix reported revenues of $8.19 billion in the last reported quarter, representing a year-over-year change of +2.7%. EPS of $3.29 for the same period compares with $3.20 a year ago.
For the current quarter, Netflix is expected to post earnings of $3.48 per share, indicating a change of +12.3% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.1% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Netflix. Also, the stock has a VGM Score of B.