Sirius XM Gears Up to Report Q2 Earnings: What's in the Offing?

Sirius XM SIRI is scheduled to report second-quarter 2025 results on July 31.

The Zacks Consensus Estimate for SIRI’s second-quarter 2025 revenues is pegged at $2.13 billion, indicating a 2.13% decrease from the year-ago quarter’s reported figure.

The consensus mark for earnings is pegged at 79 cents per share, up by a penny over the past 30 days. The figure indicates a 1.25% decline from the year-ago quarter’s actual.

SIRI’s bottom line missed the Zacks Consensus Estimate in two of the trailing four quarters, matched once and beat once, with an average negative surprise of 49.51%.

Sirius XM Holdings Inc. Price and EPS Surprise

 

Sirius XM Holdings Inc. price-eps-surprise | Sirius XM Holdings Inc. Quote

Let us see how things are shaping up for the upcoming announcement.

What Our Model Says for SIRI

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here.

SIRI currently has an Earnings ESP of +2.32% and a Zacks Rank #5 (Strong Sell). You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

You can see the complete list of today’s Zacks #1 Rank stocks here.

Factors to Note for SIRI Ahead of Q2 Results

Sirius XM’s second-quarter 2025 results are expected to reflect revenue pressures and subscriber softness that emerged in the first quarter. In the first quarter, total revenues fell 4% year over year, driven by shrinking subscriber revenues from a declining legacy satellite base.

The company's average revenue per user declined significantly year over year to $14.86 in the first quarter, reflecting promotional pricing strategies that failed to stem customer defections. The second-quarter results are expected to reflect further ARPU erosion. Such ongoing pressures are expected to have weighed on the second-quarter performance if the trajectory remained unchanged.

Sirius XM’s second-quarter performance is expected to have struggled due to intensified competition from streaming audio, podcasts and other digital platforms, with consumer migration to services, such as Spotify Technology SPOT, Apple Music, which is a subscription-based music and audio streaming service of Apple Inc. AAPL, and YouTube, owned by Alphabet GOOGL, pressuring subscriber growth and limiting pricing flexibility.

Spotify's strong subscriber growth and global reach have been drawing users away from Sirius XM's traditional satellite and streaming tiers. At the same time, Apple Music has been benefiting from seamless integration across iPhones, iPads and Macs, making it a natural option for high-quality streaming. YouTube attracts a massive global audience with its music streaming and podcast subscriptions.

Sirius XM is expected to have faced headwinds from an 11% year-over-year increase in first-quarter 2025 subscriber acquisition costs (SAC) to $100 million, driven by contractual changes with certain automakers focused on improving penetration rates and higher chipset costs. These elevated costs are likely to have pressured margins and churn rates in the second quarter of 2025.

Advertising revenue weakness, which dropped year over year to $394 million in the first quarter of 2025 from $402 million, reflected broader economic uncertainty that persisted throughout the second quarter. Although podcast revenues rose 33%, the metric failed to offset weakness in traditional channels, leaving the company vulnerable to revenue pressure in the second quarter as advertisers remained cautious with spending commitments.

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This article originally published on Zacks Investment Research (zacks.com).

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