SiriusXM Holdings stock rose by around 4% on Thursday (Oct. 29) following financial results that showed its growing mix of affordable and add-on audio entertainment plans netted it 5,000 new subscribers in the third quarter.
With more subscribers tuning into the satellite radio giant’s sports stations in the quarter and advertising revenue holding stable at $465 million, SiriusXM raised its full-year forecast for revenue, adjusted EBITDA and free cash flow the second straight quarter. The company now expects 2026 revenue of $8.55 billion, $2.65 billion in adjusted earnings before interest, tax, depreciation and amortization (EBITDA) and $1.4 billion in free cash flow. For the quarter, the company reported revenue of $2.153 billion was down slightly due to lower equipment revenue, while net income rose 6.7% to $317 million or $0.94 earnings per share. Free cash flow rose 14% to $293 million, and the company reiterated it is on track to generate $1.5 billion in total free cash flow for the year in 2027.
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SiriusXM executives said they kept a lid on expenses and are closing in on their goal of realizing $100 million in cost savings by the end of the year. Advertising revenue from podcasts rose 20%, helping to offset softness in music ad revenue and supporting Sirius in signing a four-year exclusive deal for the comedy podcast Giggly Squad, hosted by Hannah Berner and Paige DeSorbo.
“Our third-quarter performance reflects the progress we’re making in building a stronger, more durable SiriusXM,” says Jennifer Witz, Sirius XM CEO. “We’re stabilizing our subscriber base, deepening engagement through differentiated content and experiences and expanding the reach and capabilities of our advertising platform. This momentum gives us the confidence to raise our full-year financial guidance and reinforces our conviction in SiriusXM’s long-term value creation.”
Adjusted earnings before interest, tax, depreciation and amortization (EBITDA) rose 2.7% to $694 million, with adjusted EBITDA margin expanding to 32.2% from 31.3% a year ago. Sirius’s gross profit margin also increased slightly to 52.8% from 52.2% on higher gross profit of $1.136 billion in the quarter.
Total cost of services ticked down to $1.017 billion, while total operating expenses rose slightly to $1.674 billion. Subscriber acquisition costs held flat at $107 million.
The SiriusXM satellite radio and audio business individually reported total revenue edged about half a percent lower to $1.604 billion on lower equipment revenue. Gross profits and profit margin edged half a percent higher to $963 million and 60%, respectively, while average revenue per user was flat at $15.18. SiriusXM added 5,000 net new self-pay subscribers in the quarter for a total of 31.26 million.
Pandora reported total revenue of $549 million was flat year over year, though its 38.8 million monthly active users were down 6.6% from the third quarter last year. Self-pay subscribers also fell 3% to a little more than 5.5 million.
