XM Radio Inc on Thursday posted a second-quarter loss on debt-related charges and the auto industry slowdown, but the pay-radio operator said it sees signs of a recovery and raised its 2009 outlook for operating earnings.
Shares of Sirius, which have traded for less than $1 since last September, slipped about 4 percent after the company reported a net loss attributable to common shareholders of $157.3 million, or 4 cents a share.
Excluding $108 million of debt-related charges and other special items, the company lost 1 cent a share, matching analysts estimates, according to Reuters Estimates.
The company, which earlier this year secured financing from John Malone's Liberty Media Corp to stave off looming debt problems, said subscribers to the pay-radio service declined by 186,000 from the first quarter, better than many analyst expectations.
Cost-cutting—reflected in a drop in the cost of acquiring a new subscriber to $57 from $71 a year ago—was a primary driver of the company's improved financial results.
On the revenue side, Sirius XM Chief Executive Mel Karmazin said he sees positive potential for subscription sales as the beleaguered auto industry inches toward a revival.
Declines (in car sales) appear to have bottomed out," he said on a conference call with analysts. Production schedules are resuming, 'cash for clunker' programs are working and we are cautiously optimistic that the second half of 2009 will show improvement."
This story appears courtesy of PC Magazine.
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