Sirius Satellite's Revenue Falls Just Short
05/13/08 - 09:31 AM EDT
Robert Holmes
Shares of Sirius Satellite Radio (SIRI Quote - Cramer on SIRI - Stock Picks) traded lower Tuesday, one day after the company reported first-quarter revenue that came in below Wall Street's expectations.
The New York-based satellite radio operator reported a loss of $104.1 million, or 7 cents a share, in the first quarter, which narrowed from a year-ago loss of $144.7 million, or 10 cents a share. Total revenue rose to $270.4 million, up 33% from the same quarter a year earlier. Analysts were expecting a loss of 7 cents a share on revenue of $271.5 million, according to Thomson Reuters. The stock was off 4 cents, or 1.4%, at $2.83 a share in Tuesday's premarket session. Investors were more interested, though, in comments from Sirius on its pending merger with rival XM Satellite Radio (XMSR Quote - Cramer on XMSR - Stock Picks), which has received approval from the Justice Department but is still awaiting a ruling from the Federal Communications Commission. "It is almost 350 days on the FCC clock from when it was put on public notice. The FCC historically tries to review deals within 180 days," said CEO Mel Karmazin on the company's conference call. "We share the reasonable frustration that many of our investors feel regarding the time it has taken." Much like its merger partner XM, Sirius did not provide 2008 guidance in its earnings report because of the pending FCC decision. Sirius said it ended the quarter with 8.6 million subscribers, compared to 6.6 million at the end of the same quarter a year ago. The company said that increase was driven by a 72% year-over-year gain in the number of gross additions through its automotive, or OEM, channel.
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