SiriusXM has a lot to celebrate in its earnings report for the third quarter of this year: at $1.5 billion, Sirius’ revenue jumped six percent over the same period last year, and set a new record for quarterly revenue for the company. Driving much of that growth was a boost of 298,000 additional self-pay subscribers for the quarter, bringing its number to 28.5 million self-pay subscribers. In total, Sirius ended the quarter with approximately 33.7 million total subscribers, according to its filings with the SEC.
This was the first quarterly report since Sirius announced Sept. 24 it had reached an agreement to acquire Pandora in an all-stock deal worth $3.5 billion, which the company expects to close in the first quarter of 2019. That deal would create a combined internet radio conglomerate that would have brought in just shy of $7 billion in revenue in 2017.
“We have tremendous respect for Pandora and their team for building a massively popular consumer offering, and we believe there are significant opportunities to create value for both companies’ stockholders by combining our complementary businesses,” SiriusXM CEO Jim Meyer said in its investor report. “The addition of Pandora will diversify SiriusXM’s revenue streams with the U.S.’s largest digital ad-supported audio offering, broaden our technical capabilities, and represents an exciting next step to expand our reach out of the car even further.”
In the third quarter of this year, Sirius’ net income grew 24 percent over the same period last year, to $343 million from $276 in 2017. Adjusted EBITDA (earnings before interest, tax, depreciation and amortization) jumped seven percent to $589 million, another quarterly record for the company, which pushed its EBITDA margin over 40 percent for the first time. After what the company called an accounting change, average revenue per user increased slightly, up one percent to $13.48.
Within the $1.5 billion in revenue, $1.2 billion was from subscribers, while $46 million was from advertising. Those are up from $1.1 billion and $41 million in the same period in 2017, respectively. For the first three quarters of the year to date, revenue totaled $4.3 billion, up from $4.0 billion by this period last year. Within that first nine months of the year, subscriber revenue accounted for $3.4 billion, with advertising revenue totaling $135 million, up from $3.3 billion and $118 million, respectively.
“We have a relentless focus on creating and curating content our subscribers will love,” Meyer said. “Our limited-run Dave Matthews Band Radio was a perfect example. We also presented fiery live performances just for subscribers, like our recent show by The Killers in New York. We’ve added provocative talent in talk and sports, with a daily show from CNN’s Chris Cuomo, a new show from Hall of Famer Reggie Jackson, the return of Brett Favre‘s popular show, and a new program highlighting women in sports hosted by journalist Christine Brennan and retired tennis pro Rennae Stubbs.”