XM Satellite Radio just announced their Q405 and full-year 2005 results. In 2005, XM added more than 2.7 million net subscribers, to more than double subscription revenue to $503 million. XM also reiterated that they expect to be cash-flow positive in the fourth quarter of 2006 with $806 million in subscription revenue, and expect to exceed 9 million subscribers by EOY 2006 as well. By 2010, XM Satellite Radio is expecting to have more than 20 million subscribers.
2005 closed with exactly 5,932,957 subscribers (a 84% increase from 2004) with net additions for the 4th quarter being 898,315 subscribers. During the first week in January they then beat the 6 million subscriber number, just nearly missing their guidance for 2005, attributing slower than expected Holiday activations.
And now for the very closely tracked SAC/CPGA numbers (Subscriber Acquisition Costs and Cost Per Gained Acquisition):
Q4 SAC = $89 ($64 in Q404)
Q4 CPGA = $141 ($104 in Q404)
2005 SAC = $64 ($62 in 2004)
2005 CPGA = $109 ($100 in 2004)
Increased SAC/CPGA were attributed to higher marketing expenses to combat Howard Stern's move to SIRIUS Satellite Radio (or as XM calls it a "one-time competitive event"). In the first quarter of 2006, XM expects a more normalized market environment and projects that SAC and CPGA will decrease in 2006.
The conference call begins in about an hour.
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