SiriusXM Quarterly Revenue Falls 4% on Lower Subscriber Revenue

Audio entertainment giant SiriusXM reported declines in first quarter revenue and net income on Thursday.  

Revenue declined 4% to $2.07 billion and net income declined 15% to $204 million for the quarter ending March 31 compared to the year-ago period. Lower operating expenses from staff cuts and the reversal of Sirius’s streaming strategy partly offset the declines, and SiriusXM’s share price was trending downward, by about -3.4%, as of noon in New York. 

It was the first full quarter of company earnings since SiriusXM moved away from its effort to develop a streaming audience and doubled down on its core listener base in vehicles, and it comes amid increased economic uncertainty. 

Executives attempted to fend off investor concerns saying that macroeconomic jitters are not likely to negatively impact Sirius’s subscribers, its consumption in cars or marketing revenue.

“Our strong, recurring revenue-driven business positions us well in this period of heightened volatility,” Tom Barry, SiriusXM chief financial officer, said in a statement. “We do not anticipate that tariff-related pressure on new car sales will have a material impact on our subscriber or financial performance this year. That said, like every business, we’ll continue to closely monitor ongoing developments and broader consumer health.”

The company reported adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) declined 3% in the quarter to $629 million from $650 million a year ago. SiriusXM’s adjusted EBITDA margin held flat at 30%.

SiriusXM reported a 303,000 decline in subscribers to bring its total number of subscribers to roughly 33 million, which drove a 5% reduction in the business division’s subscriber revenue. Average revenue per user of $14.86, a 3% decline from the prior year.  

The SiriusXM division reported gross profit declined 6% to $937 million resulting in a gross margin of 59%. 

SiriusXM’s podcast business, which launched two new Alex Cooper channels in the quarter, reported 70 million monthly listeners and a 33%- year over year increase in podcast revenue for the quarter.  

The division also said it signed a new agreement that will put SiriusXM’s super premium 360L in all new Mitsubishi vehicles from 2025 through 2030.  

SiriusXM’s Pandora and off-platform business reported a 2% decline in total revenue of $487 million largely driven by weaker advertising performance. Ad revenue declined 2% to $355 million as softer digital ad revenue was partly offset by greater podcast revenue. Subscriber revenue for the division held flat at $132 million.  

Subscriber acquisition costs for SiriusXM rose 11%, or $10 million, from the year ago period as a result of contractual changes with certain carmakers, the company said. This was partly offset by a nearly 20% decrease in sales and marketing expenses, in addition to significant decreases in product and technology costs and administrative expenses.