Analyst: 2007 XM Subscriber Estimates
Friday, February 2, 2007 at 9:24 AM
Tags: 2, XM
While everyone's twiddling their fingers waiting for the earnings call announcements to come in, investment analysts are busy running models and coming up with subscriber estimates for the year.
This morning, UBS analyst Lucas Binder wrote in a client note that he expects XM to end 2007 with 9.1 Million subscribers, adding that about 1.5 million of the subscriber additions will occur by the second half of 2007.
“We believe the difficult retail environment and slower than expected rollout for original equipment manufacturer (OEM) factory installs will push positive net additions growth toward the second half of 2007 when we may see subscriber recovery,” Binder wrote.
[Forbes]
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1Q 2006: XM predicts that they will reach 9 million subscribers by 2007
2Q 2006: XM lowers their prediction to 8.5 million subscribers by 2007
3Q 2006: XM lowers their prediction again to 8 million subscribers by 2007
4Q 2006: XM lowers their prediction once again to 7.7-7.9 million subscribers by 2007
XM fell short with their 4Q prediction with having 7,627,873 subscribers.
GET READY FOR XM'S FUTURE FAILURES! I personally can't wait for that! Ha ha!
Posted by: Anonymous Coward | February 2, 2007 10:16 AM
I thought you liked sat radio. Why would you look forward to the companies struggling?
Posted by: PFreak ? | February 2, 2007 10:32 AM
It's funny how "modest growth" is seen as a negative. How many companies would kill for that?
The bottom line is that both companies are approaching the point beyond which sub growth is irrelevant because existing customers support costs. Because of Sirius' smaller subscriber stable and the weight of Stern's carcass, XM is likely quite a bit closer, but I'd bet both companies have a date circled on a 2009 or 2010 calendar. I'm looking forward to the day (maybe even next year) when we can stop talking about subscriber figures and focus on dollars and cents.
I kind of see XM as a car that's coasting towards a stop light. Management knows that OEM deals alone will give it enough momentum to reach consistent black ink, so why burn extra gas in the retail sector? Frankly, it's disheartening that Wall Street would rather talk about net sub adds than cost per acquisition or advertising expenses; the latter metrics are the ones that matter in the long run.
WHAT ABOUT THE MONEY, LEBOWSKI?
Posted by: Andy ? | February 2, 2007 10:52 AM
Waitaminute...
9.1 million net subs YE2007
1.5 million net adds (if he's talking gross, then XM is really fscked) in 1H
XM has 7.6 million subs now
So is he expecting XM to not grow at all in the 2H?
Posted by: leviramsey ? | February 2, 2007 12:42 PM
...yeah wait a sec, that's not right.
Posted by: Ryan Saghir ? | February 2, 2007 1:34 PM