Satellite broadcaster Sirius XM is having a banner year, with revenue increasing 13% from $744 million in the second quarter of 2011 to $838 million in the second quarter of 2012. The company added 463,000 new self-pay subscribers and 622,000 net additions overall, boosting the company’s total subscriber base to a record 23 million.
The subscriber growth was
largely driven by new vehicle shipments and light vehicle sales, as well as reactivated subscriptions resulting from used car sales.
The strong performance prompted Sirius XM to raise its guidance for subscribers, revenue and earnings for the year.
The company now projects full-year revenues of $3.4 billion, and 1.6 million net subscriber additions. It is also on firmer
financial footing, having paid its debt down to $2.7 billion, compared to around $3.1 billion this time last year.
Looking ahead, CEO Mel Karmazin pointed to rapid growth in new products like Sirius XM On-Demand, which allows subscribers to choose programming online and via smartphones. The company plans to launch an expanded personalized music feature via those channels in the second half of the year.
Although Sirius XM’s business model continues to be based predominantly on subscriptions, a small but growing proportion of its total revenues are coming from advertising. Total advertising revenue increased 14% from $18.2 million in the second quarter of 2011 to nearly $21 million in the second quarter of this year. In proportional terms, that’s a small increase from around 2.4% of total revenues to 2.5%.