NEW YORK - Sirius Satellite Radio Inc. on Tuesday reported a narrower loss for its first quarter compared with the same period a year ago, when it recorded US $225 million in expenses for stock paid to shock jock Howard Stern.
Net loss narrowed to US $144.7 million or 10 cents per share, versus US $458.5 million or 33 cents per share in the same period a year ago, slightly better than the 11 cents per share that analysts were expecting.
Excluding the Stern payout and other stock-based compensation, the results came in at eight cents per share versus 13 cents per share in the year-ago period.
Revenue rose 61 per cent to US $204 million from US $126.7 million, but was below the estimates of US $212 million recorded by analysts polled by Thomson Financial.
Sirius, which has reached an agreement to acquire its rival XM Satellite Radio Holdings Inc., gained 556,490 net subscribers in the first quarter, ending the period with 6.6 million subscribers.
XM, which reported earnings April 26, said it ended the quarter with 7.9 million subscribers and has since then topped eight million.
Sirius Satellite's costs for adding each subscriber, a figure closely watched by investors, decreased to US $104 in the first quarter from US $113 in the same period a year ago, which the company attributed to lower commission and subsidy rates, as the costs for manufacturing radio units declined.
However, another key figure, average monthly churn, increased to 2.3 per cent from 1.8 per cent, representing the percentage of subscribers that drop out every month. The higher the churn rate, the more subscribers must be added in order to continue growing the customer base.
Sirius stood by its previous guidance of reaching US $1 billion in revenues this year, as well as more than eight million subscribers by the end of the year, and an average monthly churn rate of between 2.2 and 2.4 per cent. It also said it expected subscriber acquisition costs to be about US $95.
Sirius Canada Inc. is a partnership of the government-owned CBC, privately held Standard Radio and Sirius Satellite Radio. The two Canadian partners each own 40 per cent and the U.S. company owns the remaining 20 per cent.
XM Canada is affiliated with XM Satellite Radio Holdings and Canadian Satellite Radio Holdings Inc. (TSX:XSR), a publicly traded company based in Toronto.
