According to Billboard, Radio stocks struggled this week as companies’ second-quarter earnings revealed additional revenue losses.
SiriusXM shares fell 15.6% after the company’s second-quarter earnings on Thursday (Aug. 1) showed a loss of 173,000 satellite radio subscribers and 41,000 Pandora subscribers. Revenue fell 3% to $2.18 billion, although net profit improved 2% to $316 million. In the first quarter, SiriusXM lost 594,000 subscribers, although revenue improved 0.8% to $2.16 billion.
SiriusXM is trying to thread the needle as it expands its product line and gives consumers more options. The new $9.99-per-month streaming service is intended to appeal to a broader audience than potential satellite radio subscribers. At the same time, the company is introducing new pricing tiers for satellite radio, including a $9.99 music-only subscription that can expand to news, talk and sports for additional fees. The trick is not cannibalizing its core, higher-priced satellite offering.
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| Jennifer Witz |
Also, Shares of radio broadcaster Cumulus Media fell 21% to $1.62 and dropped as far as $1.29 on Friday (Aug. 2) — a 52-week low — after the company’s second-quarter earnings showed that revenue fell 2.5% and net loss increased to $27.7 million from $1.1 million a year earlier. iHeartMedia, which doesn’t report earnings until Thursday (Aug. 8), appeared to be a casualty of Cumulus Media’s results as its shares fell 12.9% to $1.49.
Collectively, radio companies have had the worst stock performance of all music companies this year, reports Billboard. Year to date, Cumulus Media is down 69.5%, iHeartMedia has fallen 44.2% and SiriusXM is off 42.6%. Only JYP Entertainment, which has fallen 44.3% year to date, has suffered a similar drop.
The Billboard Global Music Index (BGMI), a measure of the market capitalizations of 20 publicly traded music companies, fell 1.1% to 1,739.18.
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