(Reuters) - Satellite radio provider Sirius XM Radio Inc (SIRI.O) posted higher quarterly profit and revenue on Tuesday as it added more than 500,000 subscribers.
In January, Liberty Media Corp LMCA.O became the majority owner of Sirius, and now holds more than 50 percent of the radio company’s shares. The U.S. Federal Communications Commission gave it the green light to take control of satellite radio operator after a prolonged battle for control that led to the departure of its previous chief executive, Mel Karmazin, late last year.
The company added 529,000 net subscribers in the fourth quarter, compared with 374,000 a year ago. Its churn, or rate of cancellations, improved to 1.8 percent from 2 percent in the third quarter. Its conversion rate, or the percent of promotional subscribers who become paying customers, was unchanged from a year ago at 44 percent.
Net income rose to $156.2 million, or 2 cents per share, in the quarter, from $71.3 million, or 1 cent, a year earlier.
The New York-based company said total revenue rose 14 percent to $892.4 million. Analysts had expected $898.65 million, according to Thomson Reuters I/B/E/S.
Sirius said it started a $2 billion share buyback program. In December, its board approved a long-awaited $2 billion common stock repurchase program and issued a special dividend, giving a big payout to its biggest shareholder, Liberty Media.
Sirius previously said it had added 2 million subscribers in 2012, bringing its total subscriber base to 23.9 million.
Shares fell 2 percent to $3.11 per share in premarket trading.
Sirius will host its first conference call with Wall Street on Tuesday under new interim CEO Jim Meyer. A search committee headed by Liberty CEO Greg Maffei may provide an update on its search for a permanent chief. Maffei has said the committee is considering Meyer for the top job as well as other candidates.
The company previously announced its earnings forecast for 2013. It expects to add 1.6 self-pay net subscribers and to generate revenue of $3.7 billion. It expects free cash flow of $900 million and adjusted earnings before interest, taxes, depreciation and amortization at $1.1 billion.
Reporting by Liana B. Baker; Editing by Gerald E. McCormick and Jeffrey Benkoe