A holiday buying spree helped XM Satellite Radio ( XMSR) beat its year-end subscriber goal.

The Washington-based satellite radio company said late Wednesday that 3.2 million users are now signed on for its satellite broadcasts. The news comes as XM and rival Wall Street favorite Sirius ( SIRI) trade press releases in a quest to claim satellite radio superiority.

Last week, both XM and Sirius announced that they had hit their subscriber targets for the year. As of Dec. 27, XM had added 1.7 million users to reach a 3.1 million-subscriber total, and Sirius topped 1 million total customers.

With all the numbers now in, XM says it added 700,000 new users in the fourth quarter and 1.8 million for the year. A one-day record of 50,000 new subscribers activated service on Christmas Day, the company said. Company chief Hugh Panero predicted Wednesday that XM will add 2.3 million users this year and end with 5.5 million total subscribers.

Meanwhile, Sirius unveiled a video agreement with Microsoft ( MSFT) to open the annual Consumer Electronics Show in Las Vegas Wednesday. Though some observers had expected to see a video service sometime in 2005, Sirius says it is working with Microsoft on a video product using Windows Media software for introduction sometime in the second half of 2006.

Sirius shares rose 4 cents to $7.55 and XM dropped 94 cents, or 3%, to $34.41 Wednesday.