2-9-2012
SiriusXM reported Q4 and full 2011 revenue numbers Thursday and CEO Mel Karmazin is "excited" about those results as well as 2012 projections. "We expect to deliver a very good year." In 2011 Sirius added 1.7 net new subscribers. Karmazin said it was the best year of subscriber growth since the merger. Free cash flow was $416 million which was $16 million more than what the company predicted.
And, Karmazin said it would have even been a better year "if not handcuffed by the FCC" due to an agreement not to raise the price to subscribers. That price has since been raised to $14.45 per month and (an increase of 12%) and Karmazin says that increase will help grow revenue even more in 2012 and 2013.
Here are Karmazin's Top quotes from the Thursday SiriusXM quarterly conference call.
SiriusXM will soon be offering personalized radio and on-demand options for listeners according to Karmazin. "None of our competition will have anything close."
Karmazin says Terrestrial radio is our main competitor and "we know very well hot to compete with the." He added IP radio (such as Pandora) is not a game changer.
Regarding revenue: "SiriusXM generated $2 million per employee compared to terrestrial radio generating $300,000 per employee. We have a powerful, scaleable business model."
On expenses: "In 2008 our programming costs were $447 million. In 2011 our programming costs were $324 million, a reduction of 27%. In 2012 it will be less than that."
Regarding all the new audio options available to consumers and how those options will affect advertising:
"There is too much supply out there. There is no barrier to entry. It puts power in the hands of the buyer. There is a robust amount of advertising inventory available making it a challenging business." Advertising is a small part of the SiriusXM revenue model.
(2/11/2012 8:53:49 AM)
Many off base Sirius comments posted. Sirius has entertaining music stations (I like Underground Garage, East Street Radio and Deep Tracks) and the best radio personalities including Howard Stern. I purchased 30,000 shares about 34 months ago and my long position has delivered a 700% roi. The company posted record subsriber growth in 2011. Three years ago the company was days away from bankruptcy and now they're generating 2 million in free cash flow per day. That's what I call a success.
(2/10/2012 3:14:10 PM)
Have always wished I had Mel selling for me. To him, satellite radio has been number 1 since the first day it launched. Mel can probably even answer the fact that millions of "subscriber" cars are sitting on car lots right now, unsold.
(2/10/2012 2:52:40 PM)
Inferior product. Short-sighted management. Doomed to perish due to arrogance and a lack of integrity. The only people possibly benefiting are day traders.
Forget the FCC. Bring in the FTC to put the handcuffs back on.
Pandora might not survive other companies with bigger war chests such as Clear Channel with their online options, but it was the first step towards making transmitters and broadcast licenses less valuable and with the introduction of internet radio in cars, Sirius will be gone.
The $16 Million is impressive but the "new subscribers" more than likely equates to the number of new cars sold with free satellite radio. Funny, how that wasn't mentioned...
(2/10/2012 11:57:48 AM)
Agreed. Enjoyed the variety XM offered. Therefore, only have one vehicle with an active account. May not re-up next year. RIT
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