What To Expect From Sirius XM’s Stock Post Q1?

Sirius XM (NASDAQ: SIRI), a leading provider of satellite radio, is scheduled to announce its fiscal first-quarter results on Thursday, April 27. We expect Sirius XM stock to likely trade higher with revenue and earnings beating market expectations. It should be noted that the media company benefits from a historically meager churn rate, with an implied average life for new car purchases of around five years – thanks to its solid business model. By taking advantage of the advertising reach it receives through radio, Sirius XM could likely push Pandora into podcasting for further growth opportunities in the coming quarters. In spite of the higher costs in FY2022, Sirius’ paid users have been growing. The company said it ended 2022 with 32.4 million self-pay subscribers, an increase of 348K for the year, up from 30 million at the start of 2020. Its growth has been achieved despite high car and lofty gas prices. In 2022, total revenue increased 4% year-over-year (y-o-y) to 9 billion, led by subscription revenue growth and modestly higher ad revenue, although ad revenue did begin to soften later in the year. Also, its adjusted EBITDA grew 2% to 2.83 billion.

For the full-year 2023, the company warned that they expected modestly negative self-pay net adds for the year as economic and demand uncertainty persists. SIRI also mentioned that it expects total revenue of approximately $9.0 billion, adjusted EBITDA of approximately $2.7 billion, and free cash flow of approximately $1.05 billion in FY 2023 (compared to $1.55 billion in 2022).