Sirius XM's second-quarter revenue up, raises earnings outlook
(Reuters) - Satellite radio company Sirius XM Radio Inc (SIRI.O) posted higher-than-expected quarterly revenue on Tuesday, boosted by price increases, and raised its earnings outlook for the year, sending shares up 3 percent in premarket trading.
The company, which competes with free Internet radio services such as Pandora Media Inc (P.N), reported a 13 percent rise in second-quarter revenue to $837.5 million. The result beat estimates of $834.38 million, according to Thomson Reuters I/B/E/S.
Sirius raised its target for adjusted earnings before interest, taxes, depreciation and amortization to $900 million from $875 million and kept its free cash flow expectations at $700 million.
The company did not give an update on the battle for control with Liberty Media Corp (LMCA.O), its largest shareholder, which is led by billionaire John Malone.
Sirius Chief Executive Mel Karmazin has been telling Wall Street he will not give up control of Sirius without securing a premium for his shareholders from Liberty. He may update analysts on the dispute later on Tuesday's conference call.
Excluding a $3 billion income tax benefit related to previous net operating losses, the New York-based company reported earnings of 2 cents per share, which matched analysts' estimates.
Including the tax benefit, the New York-based company reported net income of $3.13 billion, or 48 cents a share, compared with $173.3 million, or 3 cents a share, a year ago.
Due to an accounting change, this is the first quarter the company is putting its tax benefits on its balance sheet.
The company raised its prices for the first time ever at the beginning of the year. The price for its basic package went up to $14.49 a month from $12.95.
Shares rose 2.3 percent to $2.25 in premarket trading after closing at $2.20 per share on Monday.
In July, Sirius announced it added 622,042 net subscribers in the second quarter, up 38 percent from a year ago. It now has 22.9 million subscribers.
It also raised its subscriber and revenue targets last month, fueled partly by strength in the auto industry, where Sirius gets most of its customers.
(Reporting By Liana B. Baker; editing by Jeffrey Benkoe)