Sirius XM (SIRI) 1 Aug 232023 Q2 Earnings call transcript

Greetings, and welcome to the Sirius XM's Second Quarter 2023 Operating and Financial Results Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host Hooper Stevens, Senior Vice President, Investor Relations and Finance. Hooper. you, Thank

begin. You may

and and Q&A Officer, second good have to you, to questions President Executive everyone. remarks Officer. your Chief Scott take Greenstein, of join morning, XXXX earnings Jennifer this XM's our call. Officer; Chief quarter our we'll Chief Jennifer Sirius Barry, conference our from Financial portion Content Thank and Witz, Welcome the Tom will call. prepared Tom during Today, and

certain statements is I during to imprecise. that methods Private upon would statements everyone that upon current statements incorrect XXXX. term be like might may are call the Securities of management's depend forward-looking assumptions, forward-looking beliefs defined made data be and Act remind or the the all and or These based necessarily Litigation expectations as Reform in and

Such that uncertainties risks forward-looking differ could cause to are materially. statements results to and subject actual

risks SEC to earnings please intent information uncertainties, view update about more or rely obligation unduly XM's not We those release. and on forward-looking to Sirius disclaim For statements today's any and advise and them. filings listeners

As effects include about operating actual we listeners and remind to of results discussions results. of the discussions stock-based adjusted All compensation. results both call today's exclude begin, adjusted like that I'd will our

With to that, over I'll hand Jennifer. the call

Thanks, everyone. you Thank good Hooper, morning, and for joining us.

fiscal track We accomplishments XXXX quarter our the including meet to on we increased are guidance guidance. our forward free remain with the year, pleased and cash newly set for this flow

our improvement to quarter. Sirius proposition self-pay the our model with sustained net additions EBITDA closed significant quarter in Our of cash sequential total to reflected million service as our our value compared subscriber differentiated meaningful generation saw performance the and and We XX over and reaffirms expected, we we the entertainment. in churn first X.X%, flagship a audio strong low XM quarter subscribers growth, appeal business most in prominently enduring at second consumer

year. vehicle also still starts back for in market second improvement began quarter content suite us testament producing churn related is that offering, continued half trial in of improvement in positive podcast in in into and the our our first of choppy line demand our of with the up while sets a to and pleased increase quarter ad I'm to auto The including which our revenue performance the today's subscriber continued solutions. the in in a expectations, network was strength report programmatic sales and robust an

many ad XXXX. marketplace be this cautiously the It the in half are there are still in not will we gains revenue, improvement come while before optimistic variabilities we second the substantial that more in appears And see market will time at we'll year-over-year ad closely. watching

in XM quarter behind work scenes plan year. Sirius saw a behind experience our well with the The of strategic next-generation rollout accelerating to product our as strong investments momentum support this later

bullish tomorrow are our demands business meet of transformation to on consumer We segments. audience particularly those younger the of

and we ecosystem. discovery listeners even that on connection confident stronger between value new into streaming our lineup our proposition truly and must and now are in-car control to address unparalleled bring to provide even and We experiences and our is an greater subscribers create devices price, for programing

of time. of finish record with in nearing from engineers line a stack refactor team talented are Our built ground-up the complete tech the our

to key the continue innovate is on component iterate best gave leveraging our of systems we us to need the and to solutions market this timeline tools the and build and own and to quickly. backing our accelerate addition In proprietary a technologies,

engagement as personalized supercharge Within listening and sales potential subscribers and and engage utilizing example, highly us increase current habits. data AI tapping environment allowing both data as to MarTech, marketing and we early clouds rich with into for are to growing trialers own strengthen our well forces campaigns our that

We're are excited planning tuned details, the we edge app in launch a New press York a a preview host forward the car new features more event, and Stay this at cutting follow. glimpse look more to and upcoming for details fall. the sharing about including of to into to platform to come in

In profitability. will content parallel each appeal segments with and evolve the we are as pricing of subscriber grow continue with revenue pricing product and our our our our and go-to-market to we strategy an help so in can strategy, work us target doing This better evaluating that research part base, in our and to beyond. packages expectation XXXX of

XM significant Sirius for As we future embark on evolution this strategically to growth. realign continue to

indicators on We that in strong are testing we're path. early seeing the right

habits know our critical in retention. formed a and streaming term indicator trial we first example, early of is longer of the engagement For are week

series happy of we initiatives, journeys. more ongoing Outperformance onboarding that value audience record launch personalized week alignment and experienced past one we're targeting, high rates an to Through stream came improved messaging stronger with our of share user the quarter. from this prop

of at trial per and more only streaming a getting the down Furthermore, marketing with year-ago efficient pacing spend. acquisition a same reduced customers much starts drive from to number streaming capturing XX% our we're cost with we're significantly

these and lower acquisition new engagement trends costs our launch better will later year. platform as this we expect only We improve

an for reinforces and conversion that rates across of regions stream. We who in-car significance significantly those to the our conversion to was as also accelerant continue see higher demographics segments, data app

up of listening quarter Sirius saw year-over-year. The of the we adoption streaming approach technologies XM and these our platforms, reinforces these usage widening with on strong adaptive subscribers CarPlay accommodating new and Android over in to XX% reaching broad their through Lastly, preferences. Auto and

highlights to like - we see I'd few with where a strategic areas business, strategic and growth opportunities lay for OEMs. additional in-car our share key a out few some to Turning

talking spent not about our These that remains two business of tracks reiterate significant strategic for First, time car while exclusive. and are a I to strong I've a evolution, want lot mutually funnel the us.

in-car of diverse we've gaps to shared pay a in-car about are we market and of audience at a to growth which our XX more the subscriber than audiences our nearly work, as about XX audio adults segmentation of million content coming fact, inclined average into trials to confirm be in the in of one quarter third In our service, new premium compared variety deeper to will platform a our represent able million to offering previously They're from younger been U.S. that address audio dive These our we've audiences. for these for more the and today. looking they're tend versus expectations segments,

vehicles enhancing on of standard position as Volvo, feature XM and debut our new will Sirius the facilitate fully the car, a exemplified most Sirius EXXX EXXX by all-new of XXXL We cars Volvo the with automakers XXXX with in remain XM focused will SUVs. across continue agreement our recently, great and electric that and and lineup Volvo

growing U.S. significant opportunity we're widely available in And a different the to for market represent our they we models their newer partners more overall while work include the EV penetration Sirius electric in company. gas-powered consistent their have do with service XX EVs sold vehicles. with and include OEM in how only manufacturers, XM in at the and EV longstanding the rates vehicles

car connected with including within to features XXXL capabilities rates market in interactive content with features The vehicles enhanced operating to XXXL the our the the system extra presents automakers Android systems These infotainment market artist year. coupled stations EV this begins adoption to see roll-out penetration solutions. the and platform streaming Automotive delivery and Pandora various as stickier channels, begin greater headway our opportunities available within we're making will recommendations of increased consistency later different across across

as improve ways ways our own All in-car to enhancing future finding experience the premium be the car I couldn't audio for and service. the this to continuously our more continue work we we're funnel. the Overall, as demonstrates conversion number-one excited

artist Underwood's of channel to award-winning Nashville Grammy live incredibly is of relevance channel brands the and our Country. one channels. top the content, early Award streaming Moving our launches Carrie's want speak platform went entertainment Carrie country in to few I recent eight from music winner, the that highlight and landed The on launch time artists, quickly a with full-time June of new to biggest of including we're proud

surge we're in to popularity, As a industry of be excited to the experience the names continues for home category. country music some the biggest in a

a to programming and growing Kids genres. are demand our on and for continue these Music seeing our around promotions portfolio Latin We content and expand also platform

channel popular consuming kids' most month Radio, Moonbug exclusive launched we uptick last the the addition an a of today. with the listeners year-round collaboration award-winning of It's example, in new content strong in For behind, kids' content. to some percentage company an contributed entertainment and

week-long state-of-the-art Latin in events Uno. complex doors also a Howard with by Pop in across Miami with and opened a the Hits special Stern, We launch May, channels celebration several of SiriusXM along and headlined our performances of brand-new channel new the

Khaled appearances DJ performances, Miami like Latin of a different Tito to home Prince of The for El G, Becky genres. a has and artist Mecca to consuming Music and the across native and of and become like Latin contributed for Anitta, by stop Pitbull a variety Miami have listeners growth for in percentage special which Royce, Bambino quickly all studio

with during listening for listeners love audio our We coverage to TOUR continues doubled engagement tuning play-by-play home the a demonstrates sports to recently spent SiriusXM of time more PGA Radio the NBA strong as during content and Lastly, than percentage and consumers climb the quarter. saw playoffs that all one-stop sports. into major

scale of tech are the Within room continued ad with the now potential for demand, business growth, by onto see consumer from tailwind reaches we Moving and our greater our fueled advertising podcasting, increasing solutions business. our it of podcast expansion starting advertiser long as adoption. to long-term true

path growth deals given our ad with the now advertisers distribution in industry. clear as capabilities. brand our years across suitability class podcast under of seeing have targeting and we several measurement through business platform-agnostic and embracing podcasting are economics many profitable the tools, We major creators increasing to and brand including to improve our With a best-in representation solutions margins belt, appeal podcast the

XXX booked over In XXXX, across of we than Fortune brands. campaigns XXX X,XXX fact, half first podcast in more have commitments with the

advertising Additionally, we remain the long-tail business. programmatic focused opportunity growth within our on

democratize offering on to and solutions empower more sharing faster, larger in more campaigns new forward efficiently. to help look details will barrier for create audio of We lower to tools that and AI This testing access will the from campaigns through businesses We planning audio optimize suite seamlessly a of calls. small with smarter entry while future to execution. advertising are currently also and execute us brands

optimistic uncertainty and by looking their targeted broad to prospects And in and we cost-effective reach budget remains cautiously lower both attractive illustrated offering, marketers audiences. were more while are marketers to a with seeking the solution CPMs, broader marketplace, continued and most advertising where the television upfronts there for our hesitant audio about commit notably,

accelerated quarter, behind our entertainment improvements are consumers with made as we indicators seeing for with delight give the results The pleased to continue in to scenes audio extremely massive our I'm work significant me the Again, business, new today our audio and commercial the that and we more our of while we early second ahead. this gear ever up year. launch lays opportunity experience, differentiated than later conviction experiences,

in it turn through over go now I'll Tom, the more detail. who to will financials

morning, Thank you, good everyone. and Jennifer,

we noted, year. second a in we good we had of solid the half Jennifer head as into As the very and shape second quarter are

flow reiterating in free-cash to flow our working revenue adjusted We cash resulting improved higher based are capital our billion and $X.XX EBITDA and increasing lower taxes expected and guidance free-cash on conversion. guidance

billion revenue quarter, was result lines a slightly business by sell-through. hours Pandora revenue, increased advertising ad the Subscriber in higher, the decreased prior lower driven self-pay year. flat the revenue while across of we of of $X.XX to revenue as recorded compared In relatively

In the podcasting in $XXX in ad revenue, ongoing and to with million we of continue advertising growth are with the sequential expect delivered revenue continued anticipated pleased we considering improvements programmatic. quarter, the headwinds,

revenue royalties million by expenses, was year-over-year The our by of Adjusted in higher consistent increase offset driven $XXX by sales and EBITDA sequentially partially and G&A. increased XX% year-over-year with reduced and X% expectations. marketing share

will continuing cash second expenses X% pursue and And expenses. structure, quarter that the and contributed The efficiency we were on in year-over-year. productivity areas enhance operating to Total to are cost company's reduce improving benefits. focus down these

revenue advertising which revenue, is a SiriusXM slight subscriber Turning X% digital. revenue quarter year-over-year, delivered in the as segment saw and ad segments, increase given revenue broader in the the year-over-year, conditions during expected approximately and broadcast SiriusXM the year-over-year in X% $X.X relatively was flat of to X% was respectively down lagged market segment billion equipment

representing relatively can a primarily year-over-year The from for XXXX, increase margin first implemented the to billion, modestly the $X.XX of price quarter our $XX.XX, and up quarter in was the SiriusXM full-price in up remained ARPU attributed at total plans March. on certain of for quarter ARPU of flat Gross X.X% segment in profit the the be increase XX%.

XX% cost the prior quarter, installation we year. in to acquisition compared in decrease recorded Additionally a subscriber per

prior quarter. segment, flat total decrease Advertising Pandora a compared saw and $XXX this nearly revenue of $XXX million segment remained the modest by were per period. per declined year-over-year the to in active million, ad a month. Pandora X.XX revenue increase of to of in Off-Platform In just year-over-year. In X% X% billion, year X% user hours and ad hours XX hours average supported

was revenue, and light in revenue. and up to the inflater CPI growth to XX%, royalties. a was Off-platform year-over-year, partially Off-Platform decline of with Softness million, ad offset was market $XXX the the gross XX% and revenue X% and operated year-over-year web profit podcasting in margin challenges Pandora owned quarter seasonally but Pandora and segment down XX% quarter-over streaming ad by due

remainder for improve to we of the this However, year. margin expect the

Across the company.

- product business, structure optimizing leveraging to and simplify our with and interaction and cost transformation content, technology We the in continue efforts and investing our listeners. our our prudently automation with

We across ongoing have reduced improving efficiency. CSAT quarter service initiatives company, scores our including results number operating the of a costs our underway that second and customer early while

seeing space. our real our reduced Additionally, footprint relative our we initiatives, floor and estate the have XX% benefits facility to pre-COVID are optimization by of

strategy macroeconomic optimization us position will well respond improve. as to marketplace to - Our the factors

to During $X of by $XXX we and flow, due SiriusXM CapEx of $XX satellite next-generation $XX cash related to quarter, paid year-over-year, million XX million, CapEx well non-satellite higher increased from SiriusXM of down million experience $XXX the the free-cash million as taxes the construction, million, launch. of generated XX higher as driven

expect combined continue strongly our given fourth the business, be normal would of the seasonality timing quarter We to to royalty satellite free-cash the in interest weighted with payments. and

the approximately In to and capital targeted mid XXXX, continued of and times. the deliver quarter of million maintained comprised remain we we the a capital at threes strategy double, X.X quarter in in the shareholders, amount to second focused million our shareholders our We $XXX $XX in of ratio returned low repurchase finally, disciplined allocation and manner. about And returning $XXX and million on repurchased leverage to our dividends of of stock quarter. first prudent to

to executing we flexibility and the value balance all at to us integrate with Moving that facets the continue navigate strong provides while innovation cost market prioritized strategy product content sheet forward, to of company. optimize our changing and structure a our environments, investments

Q&A. over for I'll that, With it operator turn to the

Thank you. [Operator Instructions] Thank you.

Steven Cahall Wells Our question. proceed first your Fargo. question is Please from with with

out Jennifer as you to morning. think good I I has hope in the the engagement also songs with benefit and are car think is app and relaunch more already that, experience, engagement app if I incremental a music and look discovery going the Thanks, the think and non-satellite stations that to those. you'll get of that stations, lot there's skippability on from is some of both

like in gross satellite on Maybe to builds? overall think about Are customer look that as the a So talked just What I the streaming I'm start of have app mean, should about about lower relaunch back business look you little royalty wondering just us the how half year. acquisition the different bit to materially we margin you the help in-car as than satellite costs. what side? can think the versus structures margins. you margins streaming you

in mix maybe because comments and post-COVID to kind churn period. start been you in on excellent adds do go then Thank think mix make the positive. was expect you you. And between is relatedly, from model bit of the conversion a of vehicle choppier the how any trial could net half I And the it's trending, X.X% demo funnel What of improves. upward churn year pressure secondly, as back

Steven. Thanks, Sure.

retention this believe are both conversion will investing of us support and business, in streaming which higher So see because in-car the improve our outside streaming platform and to subscribers, to also margin and improve a they our question retention we the among we to who in we taking But enable first, subscribers, listen stream, when conversion rates. car.

business. will is both and this releases later support with as So into year building going year of what roll that through future the come we're to sides discussed we next out

a of streaming lower we customers directly through OEM and to our coming our have margins, point to what average customer that app streaming and the billing. see our extent really on are are licensing there stores satellite the our than side and billing on which and include dynamics for in the licensing, general app store the But on licensing, share revenue customer your music service sort we fees our music service is costs, couple our

pricing streaming are package in-car include So and side, our a access core is also $XX.XX on about $XX.XX. margins right, are subscriptions streaming stronger lower, a our which from only standpoint, percentage today bit the is

we both probably on have we the move add good and about feel side, the subscribers to on streaming side there. overall, the see more the we really So in-car expect and streaming as side growth more business on model as forward

on question your there. another churn, with really pleased we're great to performance And our quarter, yes,

any no very of We consumer weakness. involuntary solid have churn, really voluntary, signs

are increase full-price of packages seen roll-through and churn. have not to any We terms continuing voluntary in the disruptions the on rate we

noted estimates vehicle would full on the few million of sales related XX year the last the auto quarters. we are the or side getting you see the they Auto in uptick have decline The the so have quarter. related suggest XX typically You million sales that and new lag an would they year did rest in for been stronger. in-vehicle next car actually

but those a of So are into see of was reflects year conversions and auto sales dynamics doing we unique with guidance to And that quarter the we But more strong and with very throughout what the do well vehicle how to perform there point, likely half. the there we exactly second are our levels positive. that year, see with that is would higher the related we're funnel, trends question? on in next But your back-half and will believe said your the definite extent about churn part evolve, otherwise quarters our signs would very the focused cautious will through rolling one there to fourth there. net-adds other improving we we being inventory

No.

Yes, on all. you rate. touched think conversion I it

that, number rates, come personalized improve conversion to only XXXL are now, to what's really leveraging we on leveraging a fair tests new see from touch in-market have channels are of stability. just amount a we marketing, But we If that we're Right can through very and for ahead eager platform. the XXXL. of data with of new pilots we possible

We an capability our with messaging in-vehicle access easier of OEMs streaming. one have to we're and providing

earlier been we can outside right stream pretty car have again to trial now. get discovery the of conversion help so with So rates in our in-car trial navigation, to stable

you. Thank

Thank you.

question America. Ehrlich Please Jessica next Bank your is proceed with Our with of from question. Reif

A couple Thanks. different things. of

you're So thing. these about give like Jennifer, how listening can color thinking different That's some the outside the streaming what changes, you if talk, you'll and in music, packages sports. on introduced car with terms the does inside pricing first more that news, us new and of but differ offer

and the And it confident second, I that then that talk are Are or seeing improve. podcasting will the advertising, just signs wondering of of you drivers lot about what the guys will you you platform. non-music be a biggest like sounds it if

and in pulling are Thank what And like terms it are a seeing there's but the of bit. podcasting seems last when like thing, on so content for competition content, going seems the sorry be the lot you you. then a industry, that cost back may others for much in

pricing. Thanks, Okay. start I'll with Jessica.

funnel, as base. those trials to also think paying the introductory prices side seen on pressure segments into the subscription period free pricing the their is full we that you customers into interest we As and some price I where promotional where and rates growth the self-pay after And funnel end. the identified use bring car to And bring when we we've typically increasingly role well. introductory in people use car at people streaming the know,

then this we don't on is to do I in going among when to testing make there for less to this. a is with believe the that this but trading any is we if some current out make a want to few sure prove both mean, growth obviously that perhaps down to some packages demand here, test have out. we opportunity packages. go we we growth need we content and dynamic, we're through we fair actually those amount believe of But path in we've and in research create that next done maximize that sure now market customers see packages of areas. we repackage there that the And solve months roll those to And our segments we to

opportunity package as younger referenced do test us a we But that diverse, lower-income And and some these potentially with more to growth have that. has I with and lower-priced package to earlier, lower that segments do and in streaming. market an continue given

the think on question I listening differences.

of see is that of out So customers one thing listening is similar their listened of service. we - perhaps that, is car genres non-music driving with dynamics, course, non-music, do the We've plays comedy, broader and of of that not we both politics, with sports the how lot retention. music a content to a about talked terms other content in really streaming our when the to critical retention has car entertainment, music and have. we bit surprisingly, lot listening-in and when our level set our in that do breadth the a of lot non-music see into content a and more And the news, and across of higher terms in a of

over to turn advertising. to I'll Tom make comments With there. some it

resiliently face that in the advertising Yes, team continued the are just Jessica, headwinds ad industry. on dynamic our has sales against to the side,

look news slightly softness our it's and lower XM and the side but businesses, space. in you spots if media individual Sirius down is X.X%, at So at

to growth hampered a Pandora is the the is revenue. and which is a podcasting is sell-through ad lower demand, on little the reality contribution bit, significant making overall streaming the but

and Pandora travel the tourism and in telecom side. strength see in to continue We

to up strength this sales side, we Just the podcast helped see significantly channel podcast three to double-digits revenue the - advertised the currently build channels advertised to our out of XX the on of skipping streaming continue and the XX RPMs the We sales two satellite, with XX on the have podcast three two and across ad top the the channels organization. them on of growth the of revenue quarter channels, of sell three the podcast side, back and on advertisers three channels. our

So consider the 'XX we of the breadth our digital side. product to And of the be to that will and the on continue industry, strong. year more rest the is in for we in the fight the marketplace especially robust headwinds look

Yes. And Scott, want up to you pick podcasting?

Yes, sure.

of So working. Jessica, remained podcasting things. of overall view couple stable terms is has a in relatively The what's

So the look two for some Coco, at Crooked, in XX you of And of least XX XX. when ago. the the of it top had XX those. year NBC, the Freakonomics podcasting of top largely XX, and a has at top all top podcast top five same and ones, bigger have And XX we instance, Audiochuck, the and the of

more good to those. really to but our feel We importantly, there, market monetize ability those out get and on

think satellite. better As the Also multiple science, time. platforms. Tom closest is this as while compared I is come mentioned, the content it's our be will And the getting never all monetization distribution the to

which podcast, SiriusXM. at now exclusive the So started on is way, that Brady when out Tom look you

optimum or if be the ability Obviously, any flexibility think, need. can we at anything the gives frees market, I and given as financial a emerging, look is of to channels point our use as we on in distribution to that So, up, us, channels these that find well our player matters position. advertising

are where now. So, right podcasting we feel good pretty in we

Thank you. question. next Operator,

Thank you.

question. with Citi. from is Jason proceed question Please next with Our your Bazinet

focused U.S. part any and change the you But about your a been sort in app thinking as Canada. Has know bigger geographic I becomes narrative. the have of been there guys the aspirations? your on always of

we are be capabilities, platform and set other think could that I of in Jason, territories. underlying certainly used a building

areas. an - so did English-speaking in So, there probably there is we more opportunity

North be audience we that those core there. licensing that in opportunity our our at We in-car focused required have been we're successful within not serving really would at also, pursued we've super with have But because offering. believe maximizing in this very, the we -- our just largely segments, super stage America,

we of are a segments to XX incremental course, million And And as growth the million lot both And I the in opportunity us earlier, there said tap in or XX these serve the for car there's going in opportunity through like more other really adults to streaming streaming into streaming phone forward, ways well. that Canada on and represent have another, U.S. our them to - devices. experience

addressing more tap much discovery, points effective a our we In way, as into experience. the pain product control with in better and

about America that growth we we're excited of So, the us. in North have ahead

That's Thank great. you.

you. Thank

Petti Sebastiano JPMorgan. Our is from next your question proceed Please with with question.

Hi. Thanks for taking the question.

but well? had quarter more more have the the quick as things obviously, from recovery, choppy, we I some just follow-up been of second benefits And clarify second broader improvement, Just wanted half to first are expect the messaging into being 'XX? in just just then relative your if what you for or a on half of changed to now maybe sure on the the wasn't advertising and year-on-year markets, expectation front. weighted Has terms

front. still comparables second focus obviously, ad better, of see to sales half choppy. the don't bit mean they're obviously the it's the Sebastiano year, I going we think We on of prior on to will continue ad be a podcasting the lot but will focused have and to team we're a changes. the year, - little But

Tom extent the of with network there, podcasting or programmatic across our capabilities in to more programs that budgets custom-oriented that add marketers Yes. And events. bookings discussed terms or with I I audience close-in with advantage open really to buys take advertisers brands in to out the those do positioned to or of that with live have would up deploy. just the the think being able well we are

go But So, we than think Tom upside as get in QX much. - that The the a bit of through - changed as of really the the until set have the I at we QX. the don't think coming year. in expectations the comps less probably There's the a strength said, bit probably little in of our at I year we've changed easier offset outset XXXX. a not dynamics terms we've recovery

Thank you. I if quick, zooming out real just That's helpful. And could.

strategic it you Jennifer, described think, a with I business. transition the as

are that there Sirius wearing so, some this costs year. one-time And

You on algorithm in we if sounds business It think how provide yes there's some force. have on basis? for high-level towards where like, a efficiencies the business go-forward the I about eye thoughts an should But - - can reduction additional guess, growth here. the you in yes the

out think XX months changed? return and free algorithm and Q the a XX, thinking about, Ps and the mean we other this Sirius cash free as the growth a kind attack transition, of business? Thank machine. business capital guess, high-growth the these profile percentage of you as you of from new here, the are has I side advertising If flow cash How I podcasting cohorts, story, has flow the of on you. and scale

line, flow the free can a start Sure. dynamic. cash about top with bit I'll and Tom the talk

margins strong. streaming the our and So bit - look out again, a across margins to margins we call. as are our very build But address and variable new platform, in-car this earlier, in

and as course, but equal, sort So new going forward. indifferent like platform things all I've we us better add of saying position this have add things to we that, of And sales where that expect auto position other subscribers to on been better I subscribers. would - certainly us and being we're will that

we to the subscriber to pricing are are side testing. we growth still So, looking and researching it of and return

packages, subscribers satisfied that, affluent So, well. sure, we capture and very higher customer more there have there the we those a to believe be at base I'm more that demand lower-priced opportunities with also will end are opportunities. but as because our among

think on that I So, dynamics the of favor side work there Q sort in P are both and will forward. our going that

business channels like terms And cost our efficiencies lot as a for we the put profitable, has going us. do business advertising forward with have is about three the that we've dynamics that place. business Pandora in We is Tom but, some position a great the well. that love the And of and we to of talked and of in

So free Tom, want cash you do flow? talk to about

Sebastiano. sure. Yes,

good payments. cash year, just you're I from the It tax the a as flow. and we obviously relates payments down - it $XXX million. to aware, free prior mean, higher from at was satellite had So quarter covering as

guidance our year review our our principal based the - and of raised our a the review we cost basically, and of as So, upon capital in taxes. for and working

so, we billion. $X.XX to that guidance our upon based And raised

we cash our think it continue I to generate conversion at our generate very as flow I We fourth to cash. think cash. we'll continue always to at the looking free - and per positive will share. We're the free significant But said significant year, a back-end quarter. you look loaded flow cash be

right. Just hit cost it talking savings, the about you

floor our have did XX% this earlier have We we We're about downsizing down a space. pre-COVID year. and optimized from era pandemic

on Jennifer very We and as and the strength detailed future and the focused moving is. are the business SiriusXM very taking being revenue building next-generation top We and where us the and costs on innovation dollars very been our the the putting then efficiency the here more out of of team structure has to - and cost focused cost need the towards line. - out and we're the

technology although our benefits early and we've continue be business. call - we've the and in that across will we But we thrive so, and cost drive reinvest in centers to just we'll early it's and whether an continuing content reductions, program, done that that on will future. it's or focus optimization seen And areas obviously will ongoing and then are whether some

So that's...

set would And year years. next talked about and this free Sebastiano, talked levels of particularly I and this about add, cash of flow have to I unique CapEx $XXX as million that it, that about we've with satellite on year for think rolling time, we've dynamics year. through a several probably we just zero, that goes over

we tailwind way forward. that also And and believe cycle. move there's working our upside as working we we so of potential build both through have the But capital on taxes

growing and generator to come. So cash years will strong we for be to flow continue a

Thank you, both.

you. Thank

Our with Stanley. with question. Cameron next Morgan question your from Please is Mansson-Perrone proceed

question. the that the the growth Pandora see Thanks off-net in terms interesting sequential And of in at at of what you Hi. podcast on quarter, would Pandora. taking then trends color you're about It's improvement healthy talked about the do there? you tail part pretty the there? talk be to seeing in for Can MAUs the forward Any guys. helpful. you business. remaining there focused programmatic long opportunity on second the pull to Thanks What do

such MAUs, we On [indiscernible], Pandora ways investments more to and both improve as Sure. find have in programming algorithmic also - continue listening we The XXX. to branded on platform our channels with

that coming features stations. platform. build new behavior we've customers been also supported onboarding new So the Pandora to on in, loyal testing continued the are personalized that that We've to help see in cohort

things of and the SiriusXM well. that is experience One out as as we learnings them those taking doing build we're using the

churn efforts on continue make there. headway CRM we our reduce And marketing and to to

So X% And optionality we quarter. forward the just segment. more trends I of the a take profitability of to in Pandora yes, with lot initiatives. the been to going think positive, business. a last X% hours MAUs we And But have been improve down it's slightly with continue down - our actions number there the have and of

And programmatic mean, side, touched Tom on on this. I the

And And we've you getting have just, on streaming it's out opportunity number on is side. on podcasting think started, it started a place again, I and of what - in programmatic years. tapping near platforms, both on nowhere really we're build video I to just there opportunity the the there think, tools continue on side but We've podcasts. way, for streaming podcasting. - for to music the had We by see still the on the

So I for going programmatic think growth there. forward there's

Thanks. Helpful. it. Got

you. Thank

question. Evercore question Please ISI. is [indiscernible] your proceed next with with from Our

question. on taking One Hi. and Good self-pay one the for on net Thanks costs. morning. adds

too there quarter, many half. it's net first, back to a So don't towards encouraging surprises adds positive were with certainly self-pay track this think and I

specifically to by satellite. as we're begins But outlook also I too And quarter? the maybe more Sorry in your to quarter? Or next to a upside is flattish get get not the driven will trend ramp a more well? Or QX is see bit know is bigger talking that overall expectation specific, fourth suggest positive positive but you streaming? on that that likely from versus it you'll the closer is contribution satellite premature of be it streaming too to before - to

relaunch EBITDA ahead the the on of helpful. would the color some but continues any Thank sales continued relaunch SiriusXM's half expense some then look better And reverses see cost think down to can Next and I be QX us side, back and half help Gen? be presumably first understand you'll QX, where in to trends marketing added as you you of the in you. in pressure, I assume this in the

Okay. in QX. provide minute. - let not I'm I going and guidance QX cost a any I'll Tom address the to more specific on on quickly But mean the net adds,

into than back more QX, - right? We trends my be around positive. mean to streaming better versus improve now. will have will plan the I - that course But much don't half over specific slightly is expect there's QX not right So the variability And to year. that the more really continue the said insight provide the really be expectation that too number. we of it I to to on satellite a give

which into will for course the better highlighted also that ultimately, And the encouraging retention LTVs and net two are our of around trends our lower I But forward, terms of we're in over early some coupled those And in our which of acquire. with that, adds I plays streaming the of expect really pieces subscribers. some metrics seeing, cost business. we'll obviously will streaming that would we trial engagement, Going improve say to more year. higher share

in will adds. streaming So to even confidence improve more both we'll launch net to those that of that our us of continue new that equation, us we helps capabilities platform, when which give give this pieces the upside see

had correct. On year. and you're back side, sales loading We all planned marketing. obviously cost that the We're

you As sales marketing. down XX% quarter, in year-over-year in saw were and we the by

look the app, event the of heavy you our but have the we press will fourth quarter. we we will in also As cash the fourth quarter, believe lot costs, flow I at have for backloaded including have a

towards the the So EBITDA full and of the And everything is X.XX realignment we're obviously, for adjusted our year. driving planned. cost target

and sales right, be I you're quarter. obviously as loaded don't So than a see the will changing the marketing other into lot back fourth

both. great. That's Thank you,

everyone, our morning, Thanks, participating days. you this we in with of continuing for and the the right. in All care. Take many conversation forward look coming to call

today's concludes conference. This

time. lines you Thank your may for your You participation. at disconnect this