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Sirius XM's Q3 Loss Wider Than Expected, Revenues Fall Y/Y
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Sirius XM Holdings (SIRI - Free Report) reported a third-quarter 2024 loss of 84 cents per share. The Zacks Consensus Estimate for earnings was pegged at 75 cents per share. The company reported earnings of 90 cents per share in the year-ago quarter.
Total revenues, on a reported basis, declined 4.4% year over year to $2.17 billion and missed the consensus mark by 0.91%.
In the reported quarter, Sirius XM completed its transaction with Liberty Media and emerged as a fully independent public company. The company is set to reintroduce its business to reverse recent subscriber declines and enhance free cash flow generation. SiriusXM has set long-term targets of 50 million subscribers and $1.8 billion in free cash flow.
Subscriber revenues (75.77% of total revenues) declined 4.86% from the year-ago quarter to $1.64 billion, missing the Zacks Consensus Estimate by 0.14%.
Meanwhile, advertisement revenues (20.73% of total revenues) decreased 2.17% year over year to $450 million. The figure missed the Zacks Consensus Estimate by 4.61%. This decline was due to increasing new CTV supply in the market, increasing advertiser spending on performance products, truncated election cycle and low podcast inventory.
Equipment revenues (1.98% of total revenues) decreased 12.24% year over year to $43 million. The figure missed the Zacks Consensus Estimate by 9.37%.
Other revenues (1.52% of total revenues) remained unchanged year over year at $33 million and beat the Zacks Consensus Estimate by 2.27%.
The Sirius XM Standalone segment’s revenues (74.94% of total revenues) were $1.62 billion, down 5.46% year over year.
Total subscriber base declined 2.39% year over year to 33.15 million, missing the Zacks Consensus Estimate by 0.19%.
Revenues declined due to a 5.45% drop in subscriber revenues, which amounted to $1.51 billion. Advertising revenues were $41 million, down 2.38% year over year. Equipment revenues declined 12.24% year over year to $43 million. Other revenues remained flat year over year at $33 million.
Self-pay subscribers decreased 0.99% year over year to 31.49 million. Net subscriber loss in the reported quarter was 100K against net additions of 94K in the year-ago period.
Average revenue per user amounted to $15.16, down 3.38% year over year. The figure missed the Zacks Consensus Estimate by 0.53%. This reflects an increase in the number of subscribers on promotional rates, as well as streaming only self-pay plans.
Pandora & OFF Platform Details
Pandora and OFF platform’s revenues (25.06% of total revenues) declined 1.09% year over year to $544 million, owing to a 2.15% decrease in advertising revenues, which totaled $409 million. Subscriber revenues increased 2.27% year over year to $135 million.
Self-pay subscribers of the Pandora Plus and Pandora Premium services decreased 76K in the third quarter of 2024 to end the period at 5.9 million.
Total subscribers decreased 5% year over year, ending the third quarter at 5.87 million. The figure beat the Zacks Consensus Estimate by 0.03%.
Total ad-supported listener hours were 247K in the third quarter, down 7% year over year. Advertising revenue per thousand listener hours was $104.5, which remained flat year over year.
Operating Details
In the third quarter, total operating expenses increased by a whopping 192.67% year over year to $5.07 billion. The operating expenses include legacy Liberty Sirius XM operating expenses.
Adjusted EBITDA declined 7.23% year over year at $693 million.
Balance Sheet & Cash Flow
As of Sept. 30, 2024, cash and cash equivalents were $127 million compared with $100 million as of June 30, 2024.
Long-term debt, as of Sept. 30, 2024, was $10.13 billion compared with $9.04 billion as of June 30, 2024.
For the third quarter, cash flow from operations was $309 million compared with $444 million in the year-ago quarter.
Free cash flow was $93 million for the reported quarter, down from $258 million reported in the prior-year period. The decrease was mainly due to transaction-related expenses associated with the Liberty transaction.
2024 Guidance
Revenues are expected to be $8.675 billion. Adjusted EBITDA is projected to be $2.7 billion. Free cash flow is expected to be $1 billion.
Zacks Rank & Stocks to Consider
Currently, Sirius XM carries a Zacks Rank #3 (Hold).
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Sirius XM's Q3 Loss Wider Than Expected, Revenues Fall Y/Y
Sirius XM Holdings (SIRI - Free Report) reported a third-quarter 2024 loss of 84 cents per share. The Zacks Consensus Estimate for earnings was pegged at 75 cents per share. The company reported earnings of 90 cents per share in the year-ago quarter.
Total revenues, on a reported basis, declined 4.4% year over year to $2.17 billion and missed the consensus mark by 0.91%.
In the reported quarter, Sirius XM completed its transaction with Liberty Media and emerged as a fully independent public company. The company is set to reintroduce its business to reverse recent subscriber declines and enhance free cash flow generation. SiriusXM has set long-term targets of 50 million subscribers and $1.8 billion in free cash flow.
Subscriber revenues (75.77% of total revenues) declined 4.86% from the year-ago quarter to $1.64 billion, missing the Zacks Consensus Estimate by 0.14%.
Meanwhile, advertisement revenues (20.73% of total revenues) decreased 2.17% year over year to $450 million. The figure missed the Zacks Consensus Estimate by 4.61%. This decline was due to increasing new CTV supply in the market, increasing advertiser spending on performance products, truncated election cycle and low podcast inventory.
Equipment revenues (1.98% of total revenues) decreased 12.24% year over year to $43 million. The figure missed the Zacks Consensus Estimate by 9.37%.
Other revenues (1.52% of total revenues) remained unchanged year over year at $33 million and beat the Zacks Consensus Estimate by 2.27%.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
Sirius XM Holdings Inc. Price, Consensus and EPS Surprise
Sirius XM Holdings Inc. price-consensus-eps-surprise-chart | Sirius XM Holdings Inc. Quote
Sirius XM Standalone Details
The Sirius XM Standalone segment’s revenues (74.94% of total revenues) were $1.62 billion, down 5.46% year over year.
Total subscriber base declined 2.39% year over year to 33.15 million, missing the Zacks Consensus Estimate by 0.19%.
Revenues declined due to a 5.45% drop in subscriber revenues, which amounted to $1.51 billion. Advertising revenues were $41 million, down 2.38% year over year. Equipment revenues declined 12.24% year over year to $43 million. Other revenues remained flat year over year at $33 million.
Self-pay subscribers decreased 0.99% year over year to 31.49 million. Net subscriber loss in the reported quarter was 100K against net additions of 94K in the year-ago period.
Average revenue per user amounted to $15.16, down 3.38% year over year. The figure missed the Zacks Consensus Estimate by 0.53%. This reflects an increase in the number of subscribers on promotional rates, as well as streaming only self-pay plans.
Pandora & OFF Platform Details
Pandora and OFF platform’s revenues (25.06% of total revenues) declined 1.09% year over year to $544 million, owing to a 2.15% decrease in advertising revenues, which totaled $409 million. Subscriber revenues increased 2.27% year over year to $135 million.
Self-pay subscribers of the Pandora Plus and Pandora Premium services decreased 76K in the third quarter of 2024 to end the period at 5.9 million.
Total subscribers decreased 5% year over year, ending the third quarter at 5.87 million. The figure beat the Zacks Consensus Estimate by 0.03%.
Total ad-supported listener hours were 247K in the third quarter, down 7% year over year. Advertising revenue per thousand listener hours was $104.5, which remained flat year over year.
Operating Details
In the third quarter, total operating expenses increased by a whopping 192.67% year over year to $5.07 billion. The operating expenses include legacy Liberty Sirius XM operating expenses.
Adjusted EBITDA declined 7.23% year over year at $693 million.
Balance Sheet & Cash Flow
As of Sept. 30, 2024, cash and cash equivalents were $127 million compared with $100 million as of June 30, 2024.
Long-term debt, as of Sept. 30, 2024, was $10.13 billion compared with $9.04 billion as of June 30, 2024.
For the third quarter, cash flow from operations was $309 million compared with $444 million in the year-ago quarter.
Free cash flow was $93 million for the reported quarter, down from $258 million reported in the prior-year period. The decrease was mainly due to transaction-related expenses associated with the Liberty transaction.
2024 Guidance
Revenues are expected to be $8.675 billion. Adjusted EBITDA is projected to be $2.7 billion. Free cash flow is expected to be $1 billion.
Zacks Rank & Stocks to Consider
Currently, Sirius XM carries a Zacks Rank #3 (Hold).
Funko (FNKO - Free Report) , Flutter Entertainment PLC (FLUT - Free Report) and BlackLine (BL - Free Report) are some better-ranked stocks that investors can consider in the Zacks Consumer Discretionary sector. FNKO, FLUT and BL sport a Zacks Rank #1 (Strong Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of Funko have gained 53.2% year to date. FNKO is set to report third-quarter 2024 results on Nov. 7.
Shares of Flutter Entertainment have jumped 21.5% year to date. FLUT is slated to report third-quarter 2024 results on Nov. 12.
Shares of BlackLine have declined 11.3% year to date. BL is set to report third-quarter 2024 results on Nov. 7.