Pay-radio broadcaster Sirius XM reported another impressive set of results, saying Q1 profits were up 20 per cent at $207 million with revenues up 8 per cent at $1.3 billion – and helped by net growth of 257,000 subscribers taking its overall total to 31.6 million.
However, Sirius XM, owned 49.5 per cent by Liberty Media, is now guiding slightly lower forecasts for the rest of this year of $5.3 billion (it had been $5.36 billion).
“The year is off to a very solid start for our business, and we are on track to achieve our guidance for 2017. I’m particularly proud of the record adjusted EBITDA of more than half a billion dollars and record adjusted EBITDA margin of 38.7 per cent we recorded in the first quarter,” said Jim Meyer, CEO, SiriusXM. “We are also pleased to announce this morning the acquisition of Automatic Labs Inc., an exciting company focused on innovative products that broaden our array of connected vehicle services,” added Meyer.
The broadcaster’s acquisition of Automatics Labs (reportedly for more than $100 million) is interesting in that it specialises in connecting vehicles with a car adapter that plugs into the vehicles on-board diagnostic port and can provide services to the driver like vehicle tracking, diagnostic alerts and fuel monitoring.
“The acquisition of Automatic is a natural fit for SiriusXM as we continue to expand and improve our connected vehicle services,” said Jim Meyer. “Automatic’s innovative products have brought safety and intelligence data and analytics to the forefront of vehicle connectivity.”
Meyer told analysts that Automatic’s adapter was “quite impressive. They’re already on their third generation of technology on that adapter and to amplify that a little bit that adapter at least in my mind would give us the capability to reach out to a mammoth number of cars, 150 million of the 250 million active cars in the US and provide connectivity in a way that would provide connected vehicle services to those cars. We have a lot of work to do to understand what the right path to that option might be and what the speed towards that option would be, but that’s what appealed to me about Automatic.”