SiriusXM Swings To Q4 Loss On $976M Pandora Charge; Sales Up, Adds Satellite Radio Subs

Howard Stern Michael Zorn/Invision/AP/Shutterstock

SiriusXM swung to a $677 million net loss last quarter from a $243 million profit the year before on a one-time, noncash charge of $976 million at Pandora. The anticipated hit was based on Pandora’s royalty cost structure.

Quarterly revenue rose 6% to $2.19 billion, beating Wall Street expectations. The shares were up 1.4% in early trading.

New CEO Jennifer Witz, who replaced longtime chief executive Jim Meyer earlier this month, said SiriusXM, Pandora, Stitcher and SoundCloud now reach an audience of more than 150 million. The fourth quarter was key as the company agreed with star host Howard Stern to extend his contract and also closed on the Stitcher purchase, planting a flag in podcasting.

The company, controlled by John Malone’s Liberty Media, added 279,000 satellite radio subscribers during the last quarter. It lost 63,000 subs at Pandora — less than 88,000 the year before. Pandora’s ad supported listener hours hours fell 8%, but ad revenue per thousand listening hours was up 19% in the quarter from the year before. Witz, on a a conference call to discuss earnings, acknowledged that “it’s been harder than we expected” to find ways to boost listening hours at Pandora but that “the monetization has been very strong” thanks to a broader range of advertising options the company can offer.

Pandora’s monthly active users (MAUs) ended 2020 at 58.9 million, down from 63.5 million at the end of 2019.

For the full year, SiriusXM satellite added 909,000 net new self-pay subs to end 2020 with nearly 30.9 million. Self-pay monthly churn for the full year was 1.7%, an improvement of 7 basis points compared to 2019 and marking the fourth consecutive year of improving self-pay churn. Total SiriusXM subscribers were 34.7 million at the end of 2020, down approximately 1% from 34.9 million at the end of 2019. Paid promotional subscribers decreased due to lower auto sales.

SiriusXM allocated $1.57 billion to share repurchases and $237 million to dividends – which were increased by 10% in November. During the fourth quarter, the company accelerated the pace of common stock repurchases to $680 million. CFO Sean Sullivan, who joined SiriusXM from AMC Networks last fall, said the company has “tremendous liquidity to continue investing in the business and returning capital to stockholders.”

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