Sirius XM to Post Q1 Earnings: What's in the Cards for the Stock?

Sirius XM SIRI is scheduled to report its first-quarter 2025 results on May 1.

See the Zacks Earnings Calendar to stay ahead of market-making news.

The Zacks Consensus Estimate for SIRI’s first-quarter 2025 revenues is currently pegged at $2.08 billion, indicating a 3.66% decrease from the year-ago quarter’s reported figure.

The consensus mark for earnings has remained unchanged at 70 cents per share in the past 30 days. The estimate implies no year-over-year change.

SIRI surpassed the Zacks Consensus Estimate for earnings in two of the trailing four quarters, matched once and missed once, with an average negative surprise of 41.41%.

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

Sirius XM Holdings Inc. Price and EPS Surprise

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

Factors to Consider

SiriusXM’s top line in the first quarter of 2025 is expected to have been pressured by strategic adjustments aimed at improving long-term customer experience. Changes such as the launch of "click-to-cancel," shortened introductory offers, reduced marketing to higher-cost, higher-churn audiences and the introduction of lower-priced packages were implemented early in the year. While intended to strengthen its long-term business, the company noted that these actions are likely to have caused a one-time drag on subscriber additions in the first quarter.

Streaming engagement is likely to have continued supporting revenues in the first quarter. After strong December momentum, streaming listening is likely to have kept increasing steadily, driven by the new app launch and the growing importance of 360L-equipped vehicles. Additionally, the rollout of SiriusXM’s service in Tesla and Rivian models, which scaled to more than two million vehicles by year-end, is expected to have contributed to maintaining user engagement and stabilizing subscription revenue trends during the quarter under review.

Advertising revenues are expected to have grown moderately in the first quarter, supported by new content launches like the Unwell Network channels from Alex Cooper and expanded podcast agreements with Mel Robbins and Stephanie Soo. These additions are likely to have attracted more advertiser interest. However, given normal seasonality and macroeconomic caution in ad spending, advertising gains in the first quarter might have been softer compared to the stronger holiday season performance in the fourth quarter of 2024.

On the cost side, SiriusXM’s bottom line in the first quarter is expected to have benefited from the absence of several one-time expenses that weighed on 2024 results, such as Liberty overheads and transaction costs. However, about $39 million of capital expenditure related to SXM-9 launch timing and satellite milestone payments shifted into early 2025, temporarily raising capital spending during the first quarter.

Despite the temporary increase in capital spending tied to satellite milestone payments, SiriusXM’s financial performance in the first quarter is expected to have been supported by early benefits from its broader focus on margin expansion and cost efficiency. Management highlighted significant reductions in both operating and capital expenditures beginning in 2025, driven by the launch of SXM-9 in 2024.

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 exactly the case here.

SIRI currently has an Earnings ESP of +2.86% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Other Stocks to Consider

Here are some other companies worth considering, as our model shows that these also have the right combination of elements to beat earnings in their upcoming releases:

Affirm AFRM currently has an Earnings ESP of +57.14% and sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

AFRM shares have declined 19.3% in the year-to date (YTD) period. It is slated to report its third-quarter fiscal 2025 results on May 8.

Airbnb ABNB has an Earnings ESP of +6.00% and a Zacks Rank #3 at present.

ABNB shares have lost 6.2% YTD. Airbnb is scheduled to report its first-quarter 2025 results on May 1.

Roblox RBLX has an Earnings ESP of +5.21% and a Zacks Rank #2 at present.

RBLX shares have gained 14.8% YTD. Roblox is scheduled to report its first-quarter 2025 results on May 1.

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

Zacks Investment Research