Sirius XM (SIRI) Earnings and Revenues Improve Y/Y in Q1

Sirius XM Holdings SIRI reported first-quarter 2022 earnings of 8 cents per share, which matched the Zacks Consensus Estimate. However, the bottom line improved 60% year over year.

Total revenues on a reported basis increased 6% year over year to $2.19 billion. The figure beat the consensus mark by 2.76%.

Subscriber revenues (78.4% of total revenues) rose 6.3% from the year-ago quarter to $1.71 billion.

Meanwhile, advertisement revenues (17.5%) climbed 8.2% year over year to $383 million. Equipment revenues (2.4% of total revenues) declined 7% year over year to $53 million.

Other revenues (1.7% of total revenues) decreased 2.8% from the year-ago quarter to $37 million.

Sirius XM Holdings Inc. Price, Consensus and EPS Surprise

Sirius XM Holdings Inc. Price, Consensus and EPS Surprise

Sirius XM Holdings Inc. price-consensus-eps-surprise-chart | Sirius XM Holdings Inc. Quote

Sirius XM Standalone Details

Sirius XM segment revenues were $1.7 billion, up 6% year over year. While the subscriber base declined 2%, revenues witnessed growth due to 9% rise in ARPU that amounted to $15.53.

Self-pay subscribers increased 3% year over year to 32 million. Net self-pay subscribers declined 79K in the reported quarter.

Total subscribers were 34 million at the end of first-quarter 2022, lesser than 34.5 million at the end of first-quarter 2021.

Sirius XM Canada subscribers fell 3% to 2.52 million. Subscriber revenues rose 7% year over year to $1.58 billion. However, Equipment revenues slumped 7% year over year to $53 million.

Advertising revenues were $47 million, up 12% year over year. Other revenues increased 3% year over year to $37 million.

Pandora & OFF Platform Details

Pandora and OFF platform’s revenues increased 6% year over year to $467 million, owing to 8% growth in advertising revenues that totaled $336 million. Subscriber revenues climbed 1% year over year to $131 million.

Growth in ad revenues was due to an increase in first-quarter monetization to $89.77 per thousand hours, up 4.8% year over year.

Monthly active users were 50.6 million at the end of the reported quarter, down from 55.9 million in the year-ago quarter. Ad-supported listener hours declined 6.6% year over year to 2.68 billion.

Pandora exited the first quarter with 6.328 million self-pay subscribers, down 1% year over year.

Operating Details

In the first quarter, total operating expenses fell 7.1% year over year to $1.7 billion.

Revenue share and royalty costs were up 4.7% year over year to $670 million. Programming & content costs totaled $140 million, up 7.7%.

Customer service & billing costs increased 6.8% year over year to $125 million. Transmission costs advanced 6.3% year over year to $51 million.

Subscriber acquisition costs rose 4.7% year over year to $90 million. General and administrative costs increased 1.7% to $123 million.

Engineering, design and development expenses increased 4.7% from the year-ago quarter to $67 million. Sales and marketing expenses increased 25.3% to $272 million.

Adjusted EBITDA inched up 1.2% year over year to $690 million.

Balance Sheet & Cash Flow

As of Mar 31, 2022, cash and cash equivalents were $76 million compared with $191 million as of Dec 31, 2021.

The long-term debt, as of Mar 31, 2022, was $9.83 billion compared with $8.83 billion as of Dec 31, 2021.

In the first quarter of 2022, cash flow from operations was $355 million compared with $292 million in the year-ago quarter.

2022 Guidance

Revenues are expected to be $9 billion. Adjusted EBITDA is expected to be $2.8 billion.

The company anticipates adding almost 500K Sirius XM self-pay net subscribers in 2022.

Free cash flow is expected to be $1.55 billion.

Zacks Rank & Stocks to Consider

Currently, Sirius XM carries a Zacks Rank #3 (Hold).

SIRI shares have fallen 0.7% in the year-to-date period compared with the Zacks Consumer Discretionary sector’s decline of 23.3%.

Some better-ranked stocks from the Zacks Consumer Discretionary sector are Funko FNKO, sporting a Zacks Rank #1 (Strong Buy) and Vitru Limited VTRU and Afya AFYA, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Funko shares have fallen 11.3% in the year -to-date period. Funko is scheduled to release first-quarter 2022 results on May 5.

Vitru shares have increased 9.8% in the year-to-date period. Vitru Limited is slated to release first-quarter 2022 results on May 16.

Afya shares have fallen 4.2% in the year-to-date period. Afya is scheduled to release first-quarter 2022 results on May 23.

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