SiriusXM Satellite Radio saw profit dip as it paid down debt but revenue jumped 14% on new subscribers last quarter as CEO Mel Karmazin prepares to depart and the company to be taken over by Liberty Media.
Shares rose sharply in early trading, up 3.6% at $2.90 but closed even, up 1¢.
Its total paid subscriber base rose to a record high of 23.4 million. Strong auto sales helped lift total paid and unpaid trial inventory by approximately 115,000 from the second quarter to 6.2 million in the third.
Profits eased to $75 million from $104 million on revenue of $867 million. Sirius said it extinguished $107 million in debt.
It’s sticking to its guidance of 1.8 million net new subscribers for the full year.
Karmazin, the former Viacom and CBS exec who will leave in February after losing a power struggle with John Malone’s Liberty, said Sirius has produced more free cash flow in the first nine months of this year than in any full year in its history and used it to reduce debt to its lowest level since the merger of Sirius and XM in 2008.
“We continue to make investments across our business, particularly in R&D, customer care, infrastructure and programming,” he said.
Liberty is Sirius’ single biggest shareholder, with about 49%, and has said it plans to take control of the company.