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More Great News! XM Announces Q2 2005 Results and Increases Year-End Guidance

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#1 of 2 ONLINE   Ronald Epstein

Ronald Epstein

    Studio Mogul

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Posted July 28 2005 - 12:33 AM

XM Satellite Radio Holdings Inc. Announces Second Quarter 2005 Results and Increases...
Thu Jul 28, 2005 8:01 AM ET
XM Satellite Radio Holdings Inc. Announces Second Quarter 2005 Results and
Increases Year-end Subscriber Guidance to 6 Million

WASHINGTON, July 28 /PRNewswire-FirstCall/ -- XM Satellite Radio Holdings
Inc. (Nasdaq: XMSR) today reported financial and operating results for the
second quarter ended June 30, 2005. For the quarter, XM reported revenue of
$125 million, an increase of 136 percent over the $53 million reported in the
second quarter 2004. The significant revenue growth was driven by record
second quarter net subscriber additions of 647,226, a 55 percent increase over
the 418,449 subscribers added in the second quarter 2004. XM ended the quarter
with 4,417,490 subscribers compared with 2,100,352 subscribers reported for
the second quarter 2004.
(Logo: http://www.newscom.c...00724/XMSATLOGO )
With XM's first half performance and an even stronger outlook for the
second half of the year, XM is increasing 2005 subscriber guidance from 5.5
million to 6 million ending subscribers.
XM's net loss for the second quarter 2005 was ($146.6) million, as
compared to ($166.1) million in the second quarter 2004. XM reported an
EBITDA loss of ($89.9) million for the second quarter 2005 compared to
($107. million for the second quarter 2004. XM's net loss and EBITDA for
the second quarter 2004 each included a ($35.0) million charge for
de-leveraging activities.
Efficient Quarterly Subscriber Growth
XM's second quarter subscriber growth was strong across both the retail
aftermarket and automotive distribution channels. Second quarter 2005 Cost Per
Gross Addition (CPGA) was $98, an improvement of $3, or 3 percent, from the
$101 CPGA reported in the second quarter 2004. XM's CPGA is the fully-loaded
cost to acquire each new subscriber, including Subscriber Acquisition Costs
(SAC) of $50, as well as advertising and marketing expenses.
Major League Baseball Continues to Drive Subscriber Growth
In April, XM launched comprehensive live game coverage of the 2005 Major
League Baseball (MLB) season. During the May/June time period, approximately
23 percent of new aftermarket subscribers surveyed said they decided to become
an XM Radio subscriber because of MLB. In addition to MLB, XM began exclusive
satellite radio coverage of live races from the Indy Racing League (IRL) and
live golf tournament coverage of PGA TOUR events.
Samsung to Manufacture First MP3 Players with Satellite Radio Capability
and XM and Napster Partner to Launch the "XM + NAPSTER" Integrated Music
Samsung MP3 players with XM capability will be available in two storage
capacity sizes and include an XM home accessory kit. The Samsung players
incorporate XM's "Connect and Play" Technology and are expected to be
available by year-end.
Napster and XM announced "XM + Napster", a service scheduled to launch in
the fourth quarter of 2005. The new service represents an integration of XM's
satellite radio and Napster's online music services for listening online and
on a variety of MP3 players, including the new Samsung MP3 players. XM
subscribers will be able to listen to XM programming, mark their favorite
music, and purchase and manage content through Napster for future enjoyment
and storage on MP3 devices.
In the second quarter, XM also announced an exclusive agreement with
Audible, the leader in digital downloading of spoken word content. Using
XM/MP3 players, XM subscribers can purchase and download selections from
Audible's 70,000 hours of online audiobook and spoken-word programming.
XM Strategic Initiatives to Broaden the Scope and Reach of Satellite Radio
During the quarter, and into July, XM announced a number of strategic
initiatives that leverage its existing infrastructure, core competencies and
-- XM's Canadian partner, Canadian Satellite Radio (CSR), was granted a
license from the Canadian Radio-television and Telecommunications
Commission (CRTC) to deliver satellite radio to Canadians from coast-

-- In July, XM announced an agreement to purchase WCS Wireless, a private
entity, for 5.5 million shares of XM Common Stock. The principal
assets of WCS Wireless are wireless spectrum licenses in geographic
areas covering 163 million people throughout the United States,
including 15 of the top 20 markets. On average, these licenses cover
10 megahertz in the frequency bands adjacent to XM's satellite radio
service. This acquisition will enable XM to potentially double its
bandwidth and broaden the existing business with a variety of
multimedia subscription services, including video, data and additional
audio products. We expect the transaction to close later this year,
subject to regulatory approval.

-- In July, XM made a strategic investment of $25 million in the common
stock of Worldspace, Inc., a pioneer of satellite radio services in
Asia, Europe, India, the Middle East and Africa. In connection with
the investment, XM and WorldSpace will cooperate to develop satellite
radio products, technology and distribution networks optimized for
global markets.

XM, AOL and AEG Partner to Launch "Network Live" and XM and AOL Expand
Online Offering
Capitalizing on the huge potential of multi-platform live entertainment
programming, XM Satellite Radio, America Online and AEG, a world-leading
sports & entertainment presenter, joined with Kevin Wall, Executive Producer
of Live 8, to create Network Live. Network Live is the first multi-platform
digital entertainment company committed to delivering live entertainment
programming through the Internet, satellite radio and other global media
platforms such as VOD, wireless and HDTV.
During the quarter, XM and America Online also announced the creation of
the world's largest online digital radio network featuring the XM and AOL
Radio Network programming. The co-branded service will combine a sampling of
20 XM stations plus 130 AOL Radio stations. In addition, an enhanced premium
service with 70 XM stations and more than 130 AOL Radio original and third
party stations will be available to AOL members at no additional charge and to
consumers on the web for a low monthly fee. This service is expected to
launch later this summer.
About XM Satellite Radio
XM is America's number one satellite radio service with more than
4.4 million subscribers. Broadcasting live daily from studios in Washington,
DC, New York City and Nashville at the Country Music Hall of Fame, XM's 2005
lineup includes more than 150 digital channels of choice from coast to coast:
the most commercial-free music channels, plus premier sports, talk, comedy,
children's and entertainment programming; and 21 channels of the most advanced
traffic and weather information. XM was named Best Radio Service at the 2004
Billboard Digital Entertainment Awards.
XM, the leader in satellite-delivered entertainment and data services for
the automobile market through partnerships with General Motors, Honda, Toyota,
Hyundai, Nissan and Volkswagen/Audi, is available in more than 120 different
vehicle models for 2005. XM's industry-leading products are available at
consumer electronics retailers nationwide. For more information about XM
hardware, programming and partnerships, please visit http://www.xmradio.com.


Ronald J Epstein
Home Theater Forum co-owner


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#2 of 2 OFFLINE   RomanSohor


    Second Unit

  • 360 posts
  • Join Date: Jan 09 2003

Posted July 28 2005 - 01:51 PM

This is definately great news for XM. I was going to buy a Tao XM2Go to replace my SkyFi, but now I think I am going to hold off until the "second generation" of XM2Go units, or perhaps an XM2Go with MP3 capability. Humorously enough, Sirius actually announced their MP3 Player/Sat Rad Recorder a few months ago, the "Rego" but it still hasn't shown up in stores to the best of my knowledge. Makes me think about Jim Norton's comment that soon Sirius will have a Sat Rad/Phonograph player coming out :-)
Roman Sohor, CTS

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