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Bad Day for XM Yesterday; Meanwhile, Over At Sirius...
Not a good day for XM yesterday, with stock price drops following the sudden and vocal departure of a key Board member expressing concern about the company's direction. What, he didn't like the Oprah announcement?
Meanwhile, Sirius -- the home of Howard Stern -- has its own issues.
In their own SEC filing today, Sirius easily reported at first a lot of good news front and center:"SIRIUS SATELLITE RADIO REPORTS RECORD SUBSCRIBER GROWTH AND REVENUE FOR FOURTH QUARTER AND FULL-YEAR 2005"
"Subscribers Increased 190% to Over 3.3 Million at Year-End 2005"
"Satellite Radio Market Share Leader For Fourth Quarter 2005"
"2005 Revenue Grew 262% to Over $242 Million"
"More Than 6 Million Subscribers Expected by Year-End 2006"
There -- but buried -- under the positive headlines in the regulation-required letter is the fact company net losses substantially increased from $262 million to $311.4 million in the final quarter of 2005 (compared to the same period a year ago), blamed on higher costs for acquiring subscribers. Losses widened despite the tripling of revenue to $80 million in the 4th quarter, thanks to Howard Stern.
Which story do you think the Street noticed most?
Both new media companies are still expanding and trying to solidify the consumer value. Both are spending on marketing, top-of-the-line studios and equipment, distribution and consumer/receiver products and high-priced content.
It goes to show you that both XM and Sirius are still on a media/marketing rollercoaster. Up days and down days. And that there is still a lot of distance and time to build long-lasting growth. Yes, the total subscriber count is up to near 10 million, collectively. Estimates predict a total of between 35 and 50 million by 2010.
Long way to go and a lot of bills to pay to keep the lights on between now and then.
SEC filing
posted by Unknown @ Friday, February 17, 2006,
