XM Subscriber Growth Slows

XM's (XMSR Quote) subscriber growth continued to slow in the second quarter as costs rose.

The Washington, D.C., satellite radio shop posted a second-quarter adjusted loss of $47 million, or 45 cents a share. Those numbers compare with a loss of $46 million in the year-ago period.

Sales for the quarter ended in June were $277 million, up from $228 million last year.

Analysts were looking for a pro forma net loss of 44 cents on revenue of $274 million, according to Reuters Research.

XM added 338,000 net new subscribers, taking its overall total to 8.25 million. But the pace of new subscriber gains was below year-ago levels, when the company added 398,000 users.

Costs per customer additions rose to $121 from $112 a year ago, and similarly, subscriber acquisition costs jumped to $75 from $67 for the same period last year.

The news comes just two days after CEO Hugh Panero announced he would step down next month. In his last earnings statement to investors, he passed the baton to his successor.

"XM will be in great hands with Nate Davis as president and interim CEO. Nate has been an outstanding addition to the senior management team and I am confident he will carry XM to the next level of success," Panero said in a press release.

If approved, the pending merger between XM and Sirius (SIRI Quote) will see Sirius CEO Mel Karmazin take over the top job, with XM Chairman Gary Parsons will retaining his title as well.

XM shares fell 29 cents to $11.79 in early trading Thursday and Sirius slid 6 cents to $3.03.