SIRIUS Satellite (SIRI-NASDAQ) did post earnings, but because of the quarterly subscribers already shown and because of the merger with rival XM (XMSR-NASDAQ) the quarter was irrelevant. Wht does matter is the size it has reached. SIRIUS achieved positive cash flow last quarter despite quarterly losses. The annual revenues in 2006 were $637 million with just over 6 million subscribers. For the year revenues rose 163% and it added 2.7 million new clients.
The company is forecasting on a standalone basis to reach 8 million subscribers and revenues "Approaching" $ 1 Billion for 2007. It also expects churn rates at 2.2% to 2.4% and sees subscriber acquisition costs of $95.00 per subscriber. The company also notes that the merger is subject to regulatory approvals but it expects to close by the end of the year.
There have yet to be any trades in the stock on earnings this morning. Yesterday XM (XMSR) fell $0.17 after its earnings & SIRI closed flat on the day.
Jon C. Ogg
February 27, 2007
Jon Ogg is a partner in 24/7 Wall St., LLC and he can be reached at [email protected]; he does not own securities in the companies he covers.
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