SiriusXM Warns Fourth-Quarter Subscriber Trends Will Be Harder, Raises 2026 Outlook By $25 Million
CEO Jennifer Witz also said spectrum talks are shaping how the company weighs partners and deal structures.
SiriusXM expects "a more challenging fourth quarter" for self-pay subscriber trends, CEO Jennifer Witz said on the company's third-quarter earnings call Thursday, even as it raised all three full-year targets by $25 million each. Witz also said interest in commercial uses of the company's satellite spectrum is informing how it evaluates partners and deal structures.
A harder fourth quarter, a better year
SiriusXM, which runs the SiriusXM satellite radio service and the ad-supported Pandora streaming service, said it now expects about $8.55 billion in revenue, $2.65 billion in adjusted EBITDA and $1.4 billion in free cash flow for 2026. Full-year self-pay net additions are now expected to be approximately flat with 2025, when the company lost about 300,000, Witz told a JPMorgan analyst.
The fourth quarter gets tougher, Witz said, because the company is passing the first-year benefits of continuous service, still faces pressure on conversion of trials to paid plans, and is tightening promotional acquisition. Asked by a Rosenblatt analyst whether that signals a different trajectory, she said management does not see it that way and is focused on subscription revenue, not only subscribers.
Third-quarter self-pay net additions were 5,000, an improvement of roughly 45,000 from a year earlier. CFO Zach Coughlin said companion plans contributed about 107,000 net additions. Adjusted EBITDA rose 3% to $694 million, and free cash flow grew 14% to $293 million.
Spectrum as a scarce asset
Witz called the company's spectrum a "scarce strategic asset" and said satellite-to-device technology and recent industry deals reinforce its value. She said the company has studied interference from different technologies.
Growing interest in commercial applications is informing its evaluation of potential opportunities, partners and transaction structures, she said, adding that the company remains "open to a range of alternatives" and will share more when it has more information.
Buybacks and advertising
Coughlin said the company sees potential to meaningfully accelerate share repurchases in 2027 while maintaining the dividend. It ended the quarter with net leverage of 3.3 times adjusted EBITDA and about $1 billion left under its buyback authorization.
The company returned $124 million to shareholders in the quarter and cut debt by $100 million. For the fourth quarter, Coughlin said advertising trends look encouraging, while equipment revenue faces growing pressure from memory chip costs. Coughlin also said the company plans some added marketing spending.
Witz said the company would share more on spectrum partnerships when it has more information.
Sources
- SiriusXM lifts full-year forecasts as Q3 revenue misses estimates (SIRI:NASDAQ) | Seeking Alpha — seekingalpha.com
- Sirius XM: Q3 Earnings Snapshot – WTOP News — wtop.com
- Sirius XM Holdings Inc. GAAP EPS of $0.78 misses by $0.01, revenue of $2.15B misses by $10M (SIRI:NASDAQ) | Seeking Alpha — seekingalpha.com
- SiriusXM Holdings Inc. (SIRI) Stock Forecasts — Yahoo Finance
