Wednesday, January 28, 2015

Sirius XM Radio Inc (SIRI) Q3 Earnings Preview: Turning Down The Dial

SIRIUS XM Radio Inc. (SIRI) plans to release third quarter 2013 financial and operating results on Thursday, October 24, 2013. SiriusXM will hold a conference call at 8:00 am ET on Thursday, October 24, to discuss these results.  Investors and the press can listen to the conference call via the company's website at

Wall Street anticipates that satellite radio company will earn $0.02 for the quarter. iStock expects the Dow Jones Index member to hit Wall Street's consensus number. The iEstimate is $0.02, too.

Sirius XM Radio Inc. provides satellite radio services in the United States and Canada. The company broadcasts music, sports, entertainment, comedy, talk, news, traffic, and weather channels on subscription fee basis through two satellite radio systems.

Last year, the company earned a penny for 2012's third quarter. iStock examined Google Trends to see how year-over-year (YoY) search volume intensity compares to get a sense of what to expect.

We used the keywords "Sirius" (the most searched), "XM Radio" and "Sirius XM Radio" (the least searched). What we found leads is to believe that it is possible for SIRI to… fall short of the street's consensus for the third time in the last five quarters.

YoY queries for "Sirius" declined 6.85%, "XM Radio" turned down the intensity by 20.64%, and "Sirius XM Radio" was the steadiest, dipping 4.08%. However, search volume intensity improved roughly 2.38% in the third quarter versus Q2.

In a more troubling sign, we added "login" to t the aforementioned keywords. We have found "login" to be a reliable proxy for new accounts. "Sirius login" searched crashed 26.67%, "XM Radio login" were cut in half, and not enough people Googled "Sirius XM Radio login" to register search volume intensity – OUCHIE!

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In the second quarter, Sirius XM Radio had total revenue of $! 940.11 million. The street is forecasting sales of $969.67 million for Thursday's announcement or 3.14% quarter-over-quarter (QoQ) growth.

When we put all the pieces together, SIRIUS XM Radio is likely to show slowing subscriber growth (potentially running in place), sales in the neighborhood of $965 million (below consensus), and EPS hitting the consensus and iEstimate.

Overall: It appears that increasing competition could start to eat into SIRIUS XM Radio Inc. (SIRI) growth rates. Although we believe earnings will be inline, a revenue miss and flat subscribers – should it happen – could prove to be costly for shareholders.

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