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Purchase of Pandora resulted in declining profit for SiriusXM in Q1 of 2019



SiriusXM posted its Q1 2019 operating and financial results. This is the first quarter release after completing its $3.5billion all-stock acquisition of Pandora Media.

The company’s total revenue ($1.7 billion) increased by 27% compared to the same quarter in 2018, the company’s profit declined 44% year-on-year to $162 million.

According to SiriusXM, the decline came as a result of approximately $76 million of “acquisition and other costs” related to the Pandora acquisition, in addition to a $31 million “one-time benefit to other income in the prior year period and a higher tax rate”.

“SiriusXM’s first quarter of 2019 was an exciting time for the company. We’re thrilled to have completed the Pandora acquisition on February 1st and have been working quickly to integrate and coordinate the operations of the two businesses. The year is off to a strong start, and today we are issuing combined guidance for 2019 that shows continuing revenue, adjusted EBITDA and free cash flow growth,” said Jim Meyer, Chief Executive Officer, SiriusXM.

The effective tax rate for Q1 2019 totaled 33.3%, compared to 21.7% in the same period the previous year.

Self-Pay Subscribers Top 29 Million. SiriusXM added 131 thousand net new self-pay subscribers in the first quarter to end with nearly 29.1 million self-pay subscribers. Total net subscriber additions in the first quarter were 132 thousand, resulting in more than 34.2 million total SiriusXM subscribers at the end of the period. Self-pay monthly churn for the quarter was 1.8%, flat compared to the first quarter of 2018.

Monthly Active Users (MAUs) at Pandora were 66.0 million in the first quarter. This figure is down from 72.3 million in the prior year period. This resulted in total ad-supported listener hours of 3.4 billion in the period, down from 3.8 billion in the first quarter of 2018.


First Quarter for Pandora

Pandora’s total subscriber number was 6.9 million at the end of the period.

Advertising revenue at Pandora reached a first-quarter record of $231 million, growing 7% over the first quarter of 2018.

Total revenue for Pandora grew 14% to $365 million in the quarter. This is driven by a 29% increase in subscriber revenue to $134 million.

Pandora launched its Sound On brand campaign in iconic locations across Nashville, San Francisco, Oakland, NYC, Miami and Atlanta, featuring some of the season’s most high-profile artists including Jonas Brothers, Maren Morris, BebeRexha, Khalid, 2 Chainz, John Legend and Becky G. During the quarter, Pandora also launched new features like Stories, which combine the best of podcasts and music playlists and Modes, which allows the user to select a more “lean forward” or “lean back” experience.


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Abhishek Singh

Author: Abhishek Singh

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