SiriusXM CEO: Audio Is Thriving

Jim Meyer

It’s been an eventful quarter for SiriusXM, attaining their highest ever quarter of revenue at $1.47 billion and their highest ever adjusted EBITDA at $589 million.

In the earning call SiriusXM CEO Jim Meyer talked about adding 300,000 net new self-pay subs in the third quarter, Amazon partnership, Pandora Acquisition, Connected Vehicle initiatives paying off, and how it’s going with Automatic Labs, which they acquired last year.

SiriusXM CEO Jim Meyer opening statement during 2018 Q3 Earnings Call:

Thrilled With Third Quarter Results

"I can’t think of a more exciting time for all of us at SiriusXM and I’m thrilled with the results we were able to deliver in the third quarter.

"With this momentum, I’m once again pleased to increase our guidance for 2018 subscribers, revenue and EBITDA growth. We are driving more subscribers through a bigger enabled fleet and maintaining our strong content lineup as you would expect us, both of which position the company for tremendous future success.

"But we’re going even further with our proposed acquisition of Pandora Media, our investments in 360L, our next-generation in-vehicle platform and our vastly expanded push to drive engagement outside of the car with better streaming apps, including our new marketing agreement with Amazon."

Added 300,000 Net New Self-Pay Subscribers

"SiriusXM added about 300,000 net new self-pay subs in the third quarter, similar to the level we attained in last year’s third quarter. We overcame the headwind inherent to a bigger base by achieving one of our lowest ever churn rates for any third quarter and our self-pay base now stands at 28.5 million subscribers with total paid subscribers reaching 33.7 million.

"I’m thrilled we attained our highest ever quarter of revenue at $1.47 billion, our highest ever adjusted EBITDA at $589 million and our highest ever EBITDA margin, reaching 40% for the first time. We attained this margin by coupling strong revenue growth with equally impressive expense management."

Audio is Thriving Like Never Before

"Audio is thriving like never before. This has created opportunities for many new businesses to flourish and for existing businesses like ours to evolve and grow in new directions. And let me reiterate, this is not a zero-sum game. The entire pie of audio consumption is actually growing. Clearly, we remain focused on extending our winning position in the vehicle, but we are also following through on our efforts to drive engagement and subscribers out of the car as well.

"When SiriusXM’s existing subscribers use our service elsewhere, it’s bound to increase the value proposition and make our relationship stickier. And by deploying our unmatched content lineup across improved apps and ever more connected devices, we now have an opportunity to grow with customers who may want a subscription that isn’t tied to a vehicle."

New Opportunities To Consume Audio

For SiriusXM, the ubiquity of smartphones and the explosive growth of voice-activated speakers represent “enormous new opportunities to consume audio,” Meyer said.

More specifically, they’re the satcaster’s ticket to ride into the home and other locations beyond its traditional in-car listening turf. Apart from its proposed purchase of Pandora, the biggest growth initiative at SiriusXM is what Meyer called a “big push outside of the car” and into the home, work and other locations, through its “Bring Us Home” campaign.

According to InsideRadio, mobile phones, smart speakers and other connected devices have “created opportunities for many new businesses to flourish and for existing businesses like ours to evolve and grow in new directions,” he declared.

In some respects, Meyer sees the same greenfield in smart speakers as AM/FM broadcasters do, a prime opportunity to grow listening in the home.

“When SinusXM's existing subscribers use our service elsewhere, it’s bound to increase the value proposition and make our relationships stickier,” Meyer said Wednesday.