Sirius XM raises prices, shares gain
(Reuters) - After years of being prevented by the government from raising prices, Sirius XM Radio Inc said will increase the cost of its most popular radio package by about $1.50, which sent the satellite radio provider's shares up more than 7 percent on Wednesday.
Customers will now pay $14.49 a month for Sirius XM basic packages instead of $12.95. This is below the $2 price increase some analysts were expecting.
The company will also adjust the prices of other programing packages, starting January 1.
The company was widely expected to raise its prices after the Federal Communications Commission lifted a three-year ban on price increases in July. The ban was imposed after Sirius Satellite Radio merged with its only rival, XM Satellite Radio, in July 2008 and regulators worried about the creation of a lone satellite radio company.
Sirius XM, which has radios in more than 65 percent of new cars in the United States, also expects 2012 revenue of about $3.3 billion, up 10 percent from 2011.
This was slightly below analysts' expectations of $3.37 billion, according to Thomson Reuters I/B/E/S.
Last quarter, the satellite radio provider added a better-than-expected 452,147 subscribers, bringing its total listener base to more than 21 million people.
Sirius XM, home to programing by Howard Stern and Major League Baseball, continues to expect net subscriber additions of 1.6 million for 2011.
Sirius XM shares were up more than 7 percent at $1.81 in late afternoon trading on the Nasdaq.
(Reporting by Liana B. Baker in New York and Saqib Iqbal Ahmed in Bangalore; editing by Sayantani Ghosh and Andre Grenon)