http://www.businessinsider.com/sirius-xm-now-shrinking-2009-5
The recession is not helping Sirius XM (SIRI) radio as car purchases
stall and competition increases. Blow-by-blow from today's earnings
release:
* The satellite radio monopolist said it lost 400,000 net
subscribers during Q1, finishing the quarter with 18.6 million subs.
* Retail subscribers -- those who sign up for Sirius on their own,
not by buying a new car -- were the biggest defectors, at 370,000 net
sub losses, down from 49,000 net sub losses a year ago.
* But "OEM" subscribers -- people who get Sirius radios built into
their new cars -- plummeted much faster. During Q1, a net 38,000 OEM
subs left Sirius, almost 700,000 subscribers worse than net sub growth
of 659,000 a year ago. A lot of that can be blamed on Detroit's
downfall.
* Churn, the percent of customers who ditch the service each month,
increased to 2.2% from 1.9% a year ago.
* And Sirius XM's conversion rate -- getting people to sign up for
paid service after it's free for a while in their new car -- fell to
45%, down from 51% a year ago.
At this rate, it's going to be very hard for Sirius to grow subscribers
8% this year, as the company predicted last November. That's one reason
why shares are down 18% to $0.43 today.
The (mildly) better news: Sirius expects to report more than $350
million in 2009 adjusted income, up from its previous guidance of $300
million. Still, an ugly situation that has no reason to get better.
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