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SIRIUS XM (SIRI) Q3 Earnings & Revenues Surpass Estimates

Zacks Equity Research
Updated

SIRIUS XM Holdings Inc. SIRI reported third-quarter 2017 financial numbers, wherein both the top and bottom lines beat the Zacks Consensus Estimate.

Earnings of 6 cents per share exceeded the Zacks Consensus Estimate of 4 cents. The bottom line also soared 50% from the year-ago figure.

Total revenue of $1,379.6 million climbed nearly 8% year over year and also outpaced the Zacks Consensus Estimate of $1,363.8 million.

Quarterly total operating expenses were $945.63 million, up 6.8% year over year. SIRIUS XM posted record third-quarter adjusted EBITDA growth of 12% year over year to $551 million. The company’s average revenue per user increased 3% year over year to $13.41 in the third quarter.

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At the end of the third quarter, SIRIUS XM had $521.23 million of cash from operations compared with $421.82 million in the prior-year quarter. Quarterly free cash flow was $433.79 million compared with $356.53 million in the year-ago quarter.

At the end of the quarter under review, SIRIUS XM had nearly $73.55 million of cash and cash equivalents and $6,728.35 million of long-term debt compared with $213.94 million and $5,842.76 million respectively, at the end of 2016. During the reported quarter, the company repurchased 39 million shares for $211 million. It shelled out approximately $308 million to complete the Pandora P investment. The company’s board also approved a 10% hike in quarterly dividend in the third quarter.

Segment Wise Results

Quarterly subscriber revenues totaled $1,136.03 million compared with $1,069.75 million in the prior-year quarter. Advertising revenues were $41.46 million compared with $34.27 million a year ago. Equipment revenues were $32.34 million compared with $31.31 million in the year-earlier quarter. Other revenues grossed $169.78 million in the quarter compared with $142.33 million in third-quarter 2016.

Subscriber Statistics

In the third quarter, SIRIUS XM added 119,000 net new subscribers.  As a result, the total subscriber tally was up 4% year over year to 32.17 million as of Sep 30, 2017 for this Zacks Rank #4 (Sell) company.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Payment category wise, Self-Pay subscriber count grew 6% year over year, while Paid Promotional customer count was down 5% year over year.

Sirius XM Holdings Inc. Price, Consensus and EPS Surprise

 

Sirius XM Holdings Inc. Price, Consensus and EPS Surprise | Sirius XM Holdings Inc. Quote

 

2017 Guidance

The company anticipates 1.4 million net new subscriber addition in 2017, unchanged from its previous prediction. It expects revenues of approximately $5.4 billion in 2017, slightly higher than its previous expectation of $5.37 billion. Adjusted EBITDA guidance is expected to be around $2.1 billion (previous guidance: $2.05 billion). Free cash flow is expected to be approximately $1.54 billion (previous outlook: $1.5 billion).

Upcoming Releases

Investors interested in the broader Consumer Discretionary sector are keenly awaiting earnings results from key players like Discovery Communications, Inc. DISCA and Viacom Inc. VIAB. While Discovery will report third-quarter earnings on Nov 2, Viacom will report fourth-quarter fiscal 2017 earnings on Nov 16.

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