“Sirius announced that it ended the third quarter with 5,119,308 subscribers, 135% above third quarter 2005 ending subscribers of 2,173,920. SIRIUS added 441,101 net subscribers in the third quarter of 2006, a 23% increase over year-ago third quarter net subscriber additions. SIRIUS has led the satellite radio industry in net subscriber additions for four consecutive quarters, with 61% of total satellite radio net additions in the third quarter of 2006.”

Good job Sirius!

PR

Comment here.

This is just a reminder that Sirius will be having a conference call to discuss their 2nd Quarter 2006 Operating Results tomorrow (August 1st) at 8AM ET.

Sirius subscribers can hear the conference call live on Sports Play By Play Channel 125.

The following is a link to listen to the live webcast of the call:
Click

We will also be having a scheduled chat tomorrow beginning at 8AM and going through 10AM ET to discuss the call.

Comment Here

SIRIUS Satellite Radio today announced that it plans to release second quarter 2006 financial and operating results on Tuesday, August 1, 2006.

SIRIUS also plans to hold a conference call at 8:00 am ET to discuss these results. Investors, the financial community and the press can listen to the conference call via the company’s website, www.sirius.com, and on its satellite radio service by tuning to SIRIUS channel 125. A replay of the call will be available on the company’s website.

Comment Here.

XM and Sirius both released their second quarter subscriber numbers, with lots of cheer from Sirius crowd, and much dismay from the XM side. At just under 1m subs from both companies, split approx. 60/40 Sirius/XM, it became the third quarter in a row where Sirius posted strong numbers. But, the short term gains may not be great for the long-term outlook of the industry.

2nd Quarter was the first quarter where the total new subscribers was less than the new subscribers from the year before. While the numbers were fairly even(1.00 vs. 1.01 million), there has been no previous quarters that were flat for the industry year over year.

This also marks the first time second quarter additions has been less than first quarter’s. Previously, there were fairly big(20-50% increase) gains from 1st quarter to 2nd industry-wide.

Sirius has consistently been about 1 year behind XM in many regards, including:

-Stock increases/decreases
-General subscriber trends
-OEM commitment
-Revenue from advertising

Could XM’s decreasing subscriber adds signify a slowdown for Sirius in 2007? The number of new reasons to come to Sirius has been dwindling quickly. NASCAR comes in 2007, but that is one of the last major content additions for several years, when Rush Limbaugh becomes available in 2010. Many of the other recent additions either will not bring many people(The Catholic Channel, Candace Bushnall, etc.) or they are intended for subscriber retention through improved content(Barbara Walters, Wimbledon, etc.). HM, providing about 25% more bandwidth, will come along late next year, but that will likely be reserved for several channels of video.

Video, released by the end of 2007, may be Sirius’ saving grace. But what will it be used for? Children’s programming will help the OEM side, but retail will stay soft. If it is used for ESPN and other channels, then it will add to the retail slightly, but people will likely have to pay extra to get it, along with plopping down serious money for a radio with a full color screen, which many won’t do.

Hopefully, this is a one-off quarter from a lack of effective advertising, and the third quarter will be stronger. 4th quarter won’t have much change over last year simply due to Stern’s presence last holiday season. We are looking for at least another 1 million between the two companies in third quarter in order to surpass last year’s quarter. If Sirius and XM add a combined 1.1 million, then we do not need to worry about slowing growth - for now.

Comment Here.

Reuters is reporting, along with other sources such as CNBC, that Mel Karmazin has stated that Sirius would buy XM ‘if the price is right’. While that seems to be the big news of the day, it is nothing but an off-hand comment that would never work on paper, let alone real life.

While there are certainly pros to the deal, such as only one set of replacement satellites would be needed, much more bandwidth, etc., the cons far outweigh the pros:

-First off, assuming a minimum price of $20/share for a buyout, it would mean a takeover cost of well over $5 billion. Sirius cannot add that level of debt to its balance sheet at this point in time. To do so in the future would likely require a much higher share price since it seems XM’s stock price has bottomed out and is starting to rebound. If XM reaches profitability before Sirius, which is likely, their share price will rise up.

-The radios also use two different codecs; Sirius uses an evolved version of PAC, while XM uses aacPlus, meaning that they would have to roll out new radios in order for people to receive all channels, or keep one codec and lose the other, which bring us to the next point:

-Which company’s radios will be the working ones? They could go with XM’s, due to the lower cost of producing them and the larger number of subscribers out there, but then that will add confusion to Sirius subscribers, who suddenly have to buy a new radio, making it confusing when it is Sirius buying XM.

-Will they officially become one service, or stay as two? By staying as two, it would solve the radio question, but then they are competing with themselves. They will either double most of their costs, such as programming, or they will duplicate channels and waste bandwidth. If they eventually replace one service’s radios, they could offer more features such as video on the spectrum, but with only 4.5 Mbps(likely even less) in bandwidth for the video, will they make enough off of the incremental revenue for it to be worthwhile?

-How will they get this past the FCC? It is a tough sell, and in 2002 the FCC blocked a merger between Dish Network and DirecTV due to the lack of competition outweighing any benefits. That medium has the cable companies solidly entrenched offering a similar product. What will the FCC say about the only two companies who currently provide a national radio service merging?

At the end of the day, this merger talk by Mel is either nothing but talk, or Sirius will make one of the stupidest decisions in the history of the company. I hope it is the former.

According to a new SEC filing, SIRIUS CEO Mel Karmazin purchased 1 million shares of SIRIUS stock Tuesday, valued at nearly $4.5 million.

This isn’t the first vote of confidence by Karmazin. In January he put his own money on the line, buying a million shares for $6.21 each.

Today Sirius released an 8-K detailing their settlement in the CBS/Stern case. From the 8-K…

The lawsuit brought by CBS Radio Inc. against us along with Howard Stern and others referenced in Item 3 of our 2005 Annual Report on Form 10-K has been settled. As part of the settlement, CBS Radio is conveying its rights in the recordings of the Howard Stern Show that aired on CBS Radio from 1985 through 2005. We will have the right to use those recordings as part of our Howard Stern channels through December 2010. We are making a total payment of $2 million to CBS Radio. This is the only payment we will make under the settlement agreement.
Complete 8-K

There are no details on what Stern will pay himself, but Sirius got out very very well.

CBS Says Sirius To Pay $2M As Part Of Stern Settlement.

In a statement, CBS said the payment is related to the transfer of rights to recordings of “The Howard Stern Show.”

CBS said other terms and conditions of the settlement were confidential.

More details as they develop.

SIRIUS Satellite Radio today reaffirmed its guidance of more than 6.2 million subscribers by year-end 2006, representing an 87% increase over the company’s subscriber base at the end of 2005. The company continues to expect to add more than 2.8 million net subscribers during the year.

“We continue to experience dramatic growth and strong demand for our service across our retail and automotive OEM channels,” said Mel Karmazin, CEO of SIRIUS. “This supports our expectation that we will capture the majority of retail satellite radio net additions in 2006.”

According to The NPD Group*, SIRIUS achieved 54% retail market share in April 2006, compared to 38% retail market share in April 2005. For 2006 year-to-date, SIRIUS has achieved 58% retail market share, compared to 40% retail market share through April 2005. Also according to The NPD Group*, SIRIUS achieved 55% year-over-year retail unit growth in April 2006 and a 120% increase year-to-date.

SIRIUS’ first quarter of positive free cash flow, after capital expenditures, could be reached as early as the fourth quarter of 2006, and the company continues to expect to generate positive free cash flow for the full- year 2007.

Full PR

Obviously an answer to XM’s cut of their guidance from 9 to 8.5 million subscribers. The reaffirming of these numbers is good news to Sirius shareholders.

Stay tuned to this thread for the best place to catch all of the action of Sirius’ First Quarter Conference Call. The CC will take place on Sirius’ channel 125, and online at Sirius’ corporate website. The Call starts at 8am, with the earnings report out shortly beforehand. We will keep you updated with all the news Sirius reports throughout the morning. You can discuss the Conference Call with others in the SBS Chat Room.

First with the earnings news of the morning:

Sirius’s earnings report can be viewed in full here.

Highlights:

-4,077,747 subscribers - 761,187+ net increase from December 31, 2005.
-Revenue up to $126 million
-SAC(Subscriber Acquisition Costs) was $113 per new sub for the first quarter.
-Loss (.33)/share or $452 million, but includes equity charges of (.20)/share or approx. $270 million, making the GAAP net loss $182 million, or (.12)/share.
-Guidance Raised to 6.2 million subs by year end, up from 6.0 million
-960,610 Total(gross) subscribers added in the first quarter.
-Churn 1.8%
-CPGA(Subscriber Acquisition Costs + marketing expenses) approximately $154.52
-Sirius has a 57.22% marketshare for net subscribers in the First Quarter!!
-ARPU(How much money they get from an average subscription is $10.80, up slightly from $10.72 in 1Q05.

Conference Call Highlights, updated live(the FIRST Sirius site to ever do so!)

-Conference Call started @ 8:03a
-Advertising Revenue gave $.65/month to sub revenue: almost double that of XM
-Churn number is ‘all-in’, unlike XM’s, who excludes OEM promotional periods ending.
-Stressed that Sirius will not run ads on the music stations
-First Live wearable this summer, as mentioned in the last conference call
-Howard being streamed before Father’s Day
-Sirius Canada growing faster than anticipated
-New PNPs coming in time for Father’s Day, and later in the summer
-New features and versions
-Sportster4 coming in late may!
-Universal Dock, as we have mentioned before, is happening. allow one docking station type for most PNPs
-Expanded memory, buy button, MP3 functionality, and more on the Live portable
-Ads and square foot product placement is increasing in most major retailers for satellite radio
-Sirius available on just about all DCX models, with 30% of models to get Sirius this year for Chrysler, and 50% of Mercedes cars. Many mercedes brands have the P1 premium package with Sirius standard in it. Penetration for the P1 package currently runs 90%.
-Sirius available as Port installed option on many Toyota models(Ed: many Toyota options are Port and not Factory), and more Toyotas coming shortly
-400k people have opted in to Playboy so far!
-4th quarter will be strongest quarter for sports fans joining
-Rolling Stones Radio extended to the end of 2006!
-Chinese channel still coming, but not yet available
-Attracting many blue chip advertisers, such as Verizon and Subaru.
-Unique Programing saves money on marketing
-They have $715 million in cash, cash equivalents, and marketable securities - all the money they need
-Someone on the call is as sick as I am(lots of coughs)
-Developing chipsets in cell phones, but it is aways away for researching what they can get from cell phone users.
-Nothing to say about price increases, but they are the premium priced service and they will be coming sometime in the future
-Not enough history on a solid OEM take rate(the percent of users who buy a new car, and sub to Sirius after the promo period is over) yet, but Mel says look to XM’s number(about 56-58%) for an average take rate until they say to look higher or lower.
-approximately 50% share of Toyota market for 2006, don’t know the actual data.
-Another brand says that when the customer has a choice, Sirius has skyrocketed to 60% share.
-SAC will slowly build over the first three quarters, then decline in Q4
-Mel thinks Gary Parsons, senior exec. at XM did a good job testifying during hearings for the Perform Act
-Howard might be streamed on Howardstern.com as well for Sirius subs
-1st quarter advertising: 6% of revenue. First quarter is traditionally the lowest quarter for ad revenue in the tv/radio industry
-Opie & Anthony going to FM: “Good deal for Opie & Anthony”. Feels Sirius is in the business of getting subscribers to satellite radio, not syndicating exclusive content.
-continuing to invest money in repeaters, deciding where they want the repeaters to go
-May or may not have a licensing agreement with the record companies for future wearables
-Conference over @ 9:05a