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Loss Widens at XM Satellite Radio
ABC News / AP ^ | Feb 10, 2005 | SETH SUTEL - AP

Posted on 02/10/2005 1:30:50 PM PST by t_skoz

Loss Widens at XM Satellite Radio

XM Satellite Radio Reports Wider Net Loss for Fourth Quarter, Despite Adding Subscribers

Feb 10, 2005 — XM Satellite Radio Holdings Inc. reported a wider net loss for the fourth quarter of 2004 on Thursday as the company bulked up on new subscribers, adding more than 700,000 in the latest quarter to top 3.2 million users.

XM, which is based in Washington, D.C., reported a net loss attributable to common shareholders of $190.4 million for the last three months of 2004, more than the loss of $170.2 million reported in the comparable period a year ago.

The per-share loss calculations, however, fell to 93 cents in the latest period from $1.12 a year ago because of an increase in the number of shares outstanding. The loss was smaller than the $1.02 per share that analysts polled by Thomson First Call had been expecting.

Revenues more than doubled in the latest quarter to $83.1 million from $33.5 million in the year-ago period. The revenues were also above the $80.5 million that analysts had been expecting.

XM has been spending heavily on programming and marketing to build up its service as it competes with rival Sirius Satellite Radio Inc. Both companies have been signing deals with automakers to install their devices in new cars, and both are also signing multimillion dollar deals for programming, including Major League Baseball for XM and Howard Stern for Sirius.

XM said it cost the company a total of $100 to add each new subscriber in 2004, down from $137 in 2003. The company disclosed in a regulatory filing that it expected to break even on a cash flow basis in 2006, and that it expects to have subscription revenues of $480 million in 2005. The company also said it expects to have 5.5 million subscribers at the end of this year.

Last month Sirius reported that it ended 2004 with more than 1.1 million subscribers and expected to finish 2005 with more than 2.5 million. Sirius is being run by Mel Karmazin, a longtime radio executive who departed last year as the president and chief operating officer of media giant Viacom Inc., the owner of CBS and MTV.

XM's stock was up 28 cents at $31.68 in midday trading on the Nasdaq Stock Market, about in the middle of its 52-week range of $20.35 to $40.89.


TOPICS: Business/Economy; Culture/Society; Miscellaneous; News/Current Events; Technical
KEYWORDS: radio; satellite; satelliteradio; xm
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1 posted on 02/10/2005 1:30:50 PM PST by t_skoz
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To: t_skoz

XM Satellite's loss shrinks

Reuters February 10, 2005, 7:19 AM PT

http://news.zdnet.com/2100-1040_22-5570889.html

XM Satellite Radio Holdings said Thursday that fourth-quarter losses narrowed on revenue that more than doubled as its subscriber base grew.

The leader in the nascent pay-radio market, XM forecasts subscriber growth of about 71 percent this year and expects to reach cash flow break-even in 2006.

XM said it has more than 3.2 million subscribers, including a net 713,101 added in the fourth quarter.

The company posted a quarterly loss of $188.2 million, or 93 cents per share, compared with a loss of $162.9 million, or $1.12 a share, a year earlier. Revenue rose to $83.1 million, from $33.5 million, a year ago.

Analysts had expected a loss of 80 cents a share on revenue of $80.1 million, according to Reuters Estimates.

XM said its cost per gross addition, a measure of how much it spends to draw in new subscribers, was $100 in 2004, down from $137 in 2003.


2 posted on 02/10/2005 1:31:42 PM PST by t_skoz ("let me be who I am - let me kick out the jams!")
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To: t_skoz; Andrewksu; bmwcyle; BurbankKarl; Paraclete; ncpatriot; amadeus; Constitution Day; ...

XM Radio Ping list! FR-mail me to get added to or removed from this ping list.

3 posted on 02/10/2005 1:32:31 PM PST by t_skoz ("let me be who I am - let me kick out the jams!")
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To: t_skoz

Bummer -- I have XM and love it! A great service, but they need more subscribers -- they cannot raise the monthly rate of $10.00. They will go bust if they try that.

Darn.


4 posted on 02/10/2005 1:33:35 PM PST by EagleUSA
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To: t_skoz

No one expected either of these to make instant money. But I do believe they will be VERY profitable in the future.


5 posted on 02/10/2005 1:35:11 PM PST by LS (CNN is the Amtrak of news (there is no c in Amtrak and no truth in MSM news))
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To: t_skoz
Loss Widens at XM Satellite Radio

XM Satellite's loss shrinks

I must be missing something.

6 posted on 02/10/2005 1:36:47 PM PST by granite (WHY ARE WE IN IRAQ?)
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To: granite

Me too.
Which is it?


7 posted on 02/10/2005 1:38:17 PM PST by RushCrush (If it takes a bloodbath, let's get it over with. No more appeasement. - Reagan)
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To: t_skoz

please ping me


8 posted on 02/10/2005 1:38:25 PM PST by granite (WHY ARE WE IN IRAQ?)
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To: RushCrush; granite

Not too sure what's up with that, which is why I posted them on the same thread as opposed to 2 seperate threads!


9 posted on 02/10/2005 1:42:45 PM PST by t_skoz ("let me be who I am - let me kick out the jams!")
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To: granite

“There are three kinds of lies: lies, damn lies, and statistics.”

Mark Twain


10 posted on 02/10/2005 1:42:51 PM PST by B-bone
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To: granite

you've been added to the list...


11 posted on 02/10/2005 1:42:58 PM PST by t_skoz ("let me be who I am - let me kick out the jams!")
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To: granite
The per-share loss calculations, however, fell to 93 cents in the latest period from $1.12 a year ago because of an increase in the number of shares outstanding. The loss was smaller than the $1.02 per share that analysts polled by Thomson First Call had been expecting.

The loss is distributed over a wider number of outstanding shares as compared to last year. So the total loss is greater, but the per share loss is lower.

12 posted on 02/10/2005 1:45:26 PM PST by kaboom
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To: t_skoz

I just bought a new car that has XM in it and a three-month free trial. Everything you read about XM is "commercial free!" But when I listened on the hour drive home, they had the same amount of what I'd call commercials as regular radio. What they REALLY mean is that the music channels are MOSTLY commercial-free, but the rest of the channels are just more of the same BS. As far as I'm concerned, whether it's a commercial for deodorant or a commercial to listen to another XM channel, they're both the same. As for the talkie channels, they bandwidth limit them (algorithm compress them something like ADPCM) to the point that everyone sounds like they have a frog in their throat. The only saving grace of the whole mess is that I could listen to FOX NEWS on the drive in the morning if I wanted to spend the $10/month plus whatever else BS charge the local taxing authority can dream up to add on.


13 posted on 02/10/2005 1:54:10 PM PST by Gaffer
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To: EagleUSA
A great service, but they need more subscribers -- they cannot raise the monthly rate of $10.00. They will go bust if they try that.

Huh? Sirius is $13 per month.

14 posted on 02/10/2005 1:54:14 PM PST by glock rocks ( WYGIWYG)
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To: t_skoz

I have had Dishnetwork since 1998. They had growing pains also. The more I show XM to people in my GMC Envoy. The more people sign up. XM has made me want to drive for travel again. It will grow.


15 posted on 02/10/2005 2:01:58 PM PST by bmwcyle (Washington DC RINO Hunting Guide)
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To: Gaffer

None of the music channels I listen to on XM have any commercials. They hardly even have DJ's.

Yes, when you listen to Fox News or ABC Talk or whatever, they're going to have commercials but that's a downfall of the channel, not XM.

Sorry you don't like it! I have nothing but good stuff to say about my XM!


16 posted on 02/10/2005 2:03:34 PM PST by t_skoz ("let me be who I am - let me kick out the jams!")
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To: EagleUSA

What is the attraction of the XM radio? I don't have one, a couple of friends do. I enjoy my CD changer as much as listening to the XM. There must be something to it. Maybe I just don't fit the profile.


17 posted on 02/10/2005 2:04:39 PM PST by BJungNan (Please stand by while I think up a new one...)
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To: granite

Simple really. A widening loss is the same as a shrinking loss, only different.


18 posted on 02/10/2005 2:04:53 PM PST by ladtx ( "Remember your regiment and follow your officers." Captain Charles May, 2d Dragoons, 9 May 1846)
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To: bmwcyle

I take monthly trips from Western NY to Boston, and frequent trips from WNY to Detroit, Washington DC, NYC, Toronto, etc.

XM is awesome for 6 hours in the car. In some parts of Pennsylvania and Ohio, there's only the "3 C's" to listen to... Christian, Country, or Crap.

;-)


19 posted on 02/10/2005 2:06:04 PM PST by t_skoz ("let me be who I am - let me kick out the jams!")
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To: t_skoz

Does anyone know when XM and Sirius might have interoperability?


20 posted on 02/10/2005 2:06:17 PM PST by Sonny M ("oderint dum metuant")
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To: Sonny M

probably never.


21 posted on 02/10/2005 2:06:41 PM PST by t_skoz ("let me be who I am - let me kick out the jams!")
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To: bmwcyle
The more I show XM to people in my GMC Envoy. The more people sign up. XM has made me want to drive for travel again. It will grow.

Same here with my Buick LeSabre. Nice to drive cross country and never lose a station.

22 posted on 02/10/2005 2:07:24 PM PST by ladtx ( "Remember your regiment and follow your officers." Captain Charles May, 2d Dragoons, 9 May 1846)
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To: t_skoz
When we signed up, we paid for two years.

Trips in the car are wonderful, even when we get out of range of local stations, the XM is always there for us. We listen to Fox News, and even CNN. We have our choice of any type of music we want, from Country and Western to Broadway shows.

We love XM.

sw

23 posted on 02/10/2005 2:09:22 PM PST by spectre (Spectre's wife)
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To: BJungNan

The attraction is: programming worth listening to.

High-profile AM talk show hosts aside, there is little worth listening to on commercial radio, particularly when it comes to music stations.

XM offers a wide range of music, with huge playlists, that make listening enjoyable again. Plus Fox News and the MLB thing just sweetens the pot.

No, I'm not a subscriber yet, but will be as soon as I buy a new vehicle.


24 posted on 02/10/2005 2:10:15 PM PST by B Knotts
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To: t_skoz

I listen to FOX News on XM for about an hour a day at work, usually just to get Special Report. It's perfect for that. I can even get a perfect signal through the double-thick panes in our commercial high-rise. (although I am facing the right direction...)


25 posted on 02/10/2005 2:13:57 PM PST by July 4th (A vacant lot cancelled out my vote for Bush.)
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To: t_skoz

They have 3.2 million subscribers and they lost $190 million in 3 months.

This means they're losing $20 per subscriber per month.

I love my XM to death, but I'll be darned if I can figure out how they're supposed to make any money.

One thing they can do is get rid of all the DJ's. If I wanted some yutz to talk over my music, I'd listen to FM.


26 posted on 02/10/2005 2:19:59 PM PST by VisualizeSmallerGovernment (Question Liberal Authority)
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To: t_skoz
There must be some under-employed accountants from that donut company or the whiz-bang telephone company that can probably fluff these numbers......
27 posted on 02/10/2005 2:21:00 PM PST by pointsal
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To: VisualizeSmallerGovernment

I suspect a good portion of their reported operating expenses is depreciation on their satellites (and related assets). This is a non-cash expense.

On a cash flow basis, they're probably pretty close to break even... which means they can meet their day-to-day expenses. They need to grow their subscriber base by about 5x to throw off sufficient cash to retire their debt. They have some time to do this so long as they can keep the cash flow positive.


28 posted on 02/10/2005 2:27:49 PM PST by So Cal Rocket (Proud Member: Internet Pajama Wearers for Truth)
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To: LS

>>But I do believe they will be VERY profitable in the future.<<

Well, them or whoever buys their infrastructure if they go TU.

In commercial real estate, sometimes you see a building go up in an apparently great location, but nobody moves in. After a year or so, the owner defaults, it is sold at auction, and the new owner, having much less in the building, rents it out at rates that actually attract tenants.


29 posted on 02/10/2005 2:32:01 PM PST by RobRoy (They're trying to find themselves an audience. Their deductions need applause - Peter Gabriel)
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To: t_skoz

Hope XM sticks through this for a while longer. I was just thinking to myself the other day after reading an ad in an old magazine that I should look into XM.

Dozens of channels of every type of music, talk ,etc. (the ad had 11 or 12 distinct Hard/Alterna/Classic Rock channels alone listed--YEA!), music by decade, music by theme, talk radio, sports, etc. Many of the channels were listed as commercial free, some as unedited (great for comedy and rap); it sure sounds like a winner to me.

If XM hold up for a few more months, I think I'm definately going to join up. Is it really as good as it sounds?


30 posted on 02/10/2005 2:40:34 PM PST by RockAgainsttheLeft04 (Chaos is great. Chaos is what killed the dinosaurs, darling. -- from Heathers (1989))
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To: t_skoz
probably never.

I know Michael Powell wanted assurances from both that they would have interoperability at some point, but he didn't give a time frame.

I assume he put it somewhere in writing.

My guess is still not sure, but it is inevitable.

31 posted on 02/10/2005 2:41:25 PM PST by Sonny M ("oderint dum metuant")
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To: RushCrush
It's both.
Total loss increased.
Loss per share decreased.
32 posted on 02/10/2005 2:53:10 PM PST by Publius6961 (The most abundant things in the universe are hydrogen, ignorance and stupidity.)
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To: t_skoz

Nothing ventured, nothing gained.


33 posted on 02/10/2005 2:59:28 PM PST by Imal (Saluting SPC Taylor Burk, a genuine hero and true American. d. 1/26/2005)
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To: RobRoy
In commercial real estate, sometimes you see a building go up in an apparently great location, but nobody moves in. After a year or so, the owner defaults, it is sold at auction, and the new owner, having much less in the building, rents it out at rates that actually attract tenants.

The conventional wisdom is that the third owner of a golf course is the first guy to make money.

34 posted on 02/10/2005 3:02:59 PM PST by Modernman (What is moral is what you feel good after. - Ernest Hemingway)
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To: Modernman

That reminds me of a quote from a motivatinal speaker for real estate agents.

It is best to be the first love, second wife and third real estate agent.


35 posted on 02/10/2005 3:13:25 PM PST by RobRoy (They're trying to find themselves an audience. Their deductions need applause - Peter Gabriel)
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To: RockAgainsttheLeft04

I love my XM. I have as presets the Christian channels (hard rock, lighter); all decades (70s, 80s, 90s); an older rock station called "deeptracks"; "BPM," which is a tecno dance channel; comedy, and I can go to movie scores or broadway quickly.


36 posted on 02/10/2005 3:34:43 PM PST by LS (CNN is the Amtrak of news (there is no c in Amtrak and no truth in MSM news))
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To: granite

In the article it details it all.

The loss widened in as much XM is still not making money. The loss shrunk in that they're losing less.

Just like how the Democrats play word games.


37 posted on 02/10/2005 4:04:25 PM PST by Bogey78O (Hillary Clinton + Fertility pills + Scott Peterson + rowboat = Success)
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To: t_skoz

They have to slip in commercials into the talkers for the obvious reason that the source has commercials. What are they to do? Give dead air?


38 posted on 02/10/2005 4:06:38 PM PST by Bogey78O (Hillary Clinton + Fertility pills + Scott Peterson + rowboat = Success)
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To: Sonny M

Never. Theoetically you can have one unit that could cover both but since it's a pay service and use two different signals you'd have to have a dual tuner and a licensing agreement.

Never gonna happen.


39 posted on 02/10/2005 4:08:17 PM PST by Bogey78O (Hillary Clinton + Fertility pills + Scott Peterson + rowboat = Success)
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To: VisualizeSmallerGovernment

A DJ on satellite radio is worthless really. Outside of compiling a playlist the song announcement is on the LCD.


40 posted on 02/10/2005 4:10:03 PM PST by Bogey78O (Hillary Clinton + Fertility pills + Scott Peterson + rowboat = Success)
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To: t_skoz

I guess it would interest me if I was in my car all the time, or was an audiophile.

I do like all the music channels I get with my DishTV subscription. All music and no chatter is nice, so I can see the attraction to XM. We live in the boonies and can't get cable, so it's nice to have.


41 posted on 02/10/2005 4:19:19 PM PST by Diana in Wisconsin (Save The Earth. It's The Only Planet With Chocolate.)
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To: Gaffer

Switch to Sirius. Crystal clear sound because they have 3 sats that orbit the US while XM's 2 sit on the equator. Higher angle and more bandwidth.


42 posted on 02/10/2005 4:24:20 PM PST by Creightongrad
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To: Gaffer

I have a funny feeling Fox Radio News will be coming to an AM soon ...


43 posted on 02/10/2005 4:25:40 PM PST by Republicus2001 (C)
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To: Gaffer

I went to XM because regular radio was impossible to listen to becuase of all the commercials. I find that the music stations are commercial free, though they do throw in some short blips about what is on other channels as well as short fillers between songs. But overall it is an order of magnitude better than AM or FM.

The non-music channels (like FOX or the comedy channels) do have some commercials, but they are manageable.

Overall, I love XM!


44 posted on 02/10/2005 4:46:10 PM PST by Laserman
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To: t_skoz
In some parts of Pennsylvania and Ohio, there's only the "3 C's" to listen to... Christian, Country, or Crap.

That's not true.....there's Polka too.

45 posted on 02/10/2005 5:40:05 PM PST by USNBandit (sarcasm engaged at all times)
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To: t_skoz

Add me to your ping list. I love my XM, both for the great music, and for the jealousy it provokes in my friends. :-)


46 posted on 02/10/2005 5:43:46 PM PST by Steel Wolf (Smokey, this is not 'Nam. This is bowling. There are rules. Mark it zero, Dude.)
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To: glock rocks

I have SiriusSat, I like it :), as for the price, it's worth if for my tunes ;)


47 posted on 02/10/2005 5:50:59 PM PST by 1FASTGLOCK45
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To: t_skoz

I'm still kicking around whether to get XM or Sirius.


48 posted on 02/10/2005 6:31:12 PM PST by Ciexyz (I use the term Blue Cities, not Blue States. PA is red except for Philly, Pgh & Erie)
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To: EagleUSA

Just got ours as a three-month freebie for buying a Chevy Silverado, and of course, we're already hooked! We'll certainly be subscribers at the end of this initial period, so their strategy of giving 90 days free costs them money, but it will make them money in the future.


49 posted on 02/10/2005 6:36:52 PM PST by kittymyrib
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To: kittymyrib

Just got ours as a three-month freebie for buying a Chevy Silverado, and of course, we're already hooked! We'll certainly be subscribers at the end of this initial period, so their strategy of giving 90 days free costs them money, but it will make them money in the future.
======
Sounds like they really over-extended themselves on the programming -- they blew it on the big sports events -- since most of their subscribers pay for the music, not sports. May have been a BIG tactical error...


50 posted on 02/10/2005 6:40:10 PM PST by EagleUSA
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