Net profit more than doubles last quarter
Sirius XM Radio shrugged off boardroom and executive drama as business surged last quarter and it posted its biggest net new subscriber bump in five years.
“As you know, we’ve had a lot of change here over the past six weeks,” said CEO Jim Meyer, who recently replaced former chief Mel Karmazin, on a conference call Tuesday.
Sirius XM’s majority shareholder Liberty Media just boosted its stake to over 50%, assuming control, and added three new directors. It hasn’t divulged its plans for the company, and none were offered by Sirius execs Tuesday.
“What is not changing is the consistent focus by everyone here…on delivering great service,” Meyer said.
Sirius’ net income jumped to $156 million from $71 million as revenue rose to $892 million from $784 million.
Gotham-based Sirius cited higher-than-expected auto sales and lower-than-expected churn. Execs also said its push into the used car market has paid off, with a million subscriber adds there and 1.5 million expected in 2013.
Sirius added 2 million paid subscribers last year and ended the year with 23.9 million.
New vehicle conversion rate was 45% in 2012, the same as in 2011.
Sirius also paid a $327 million special dividend, returning cash for shareholders for the first time. And it set up a $1.25 billion revolving credit facility, as yet untapped, to fund a stock buyback program.
Meyer said Sirius new personalized radio feature MySXM is currently in public beta testing and will be available to online customers soon. Cars are Sirius’ lifeline, so Internet-connected cars will be a major paradigm shift.
“The buzzword for me is connected car,” Meyer said. “I think every automaker is planning or putting in place how they intend to deal with their architecture in 2017 and beyond for the connected car. I think it’s important we participate.”