Sirius XM Holdings Inc Q1 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Sebastiano Petti - JP Morgan - Analyst : Hi, thank you for taking the question. Just thinking about the full year guide, Tom, sounded pretty confident in the levers in the business, cost-cutting opportunity, but just help us think about -- there's no tariff impact, as you guys mentioned on the call. The price increase is now fully baked, ARPU comps are getting easier for the year and cost efforts are beginning to scale. Margins in the first quarter were flat year-over-year, the guide implies 140 basis contraction. Why isn't there upside to the 2025 EBITDA guide? What are we missing here? And then as we're thinking about the impact of digital, you reiterated a couple of hundred thousand impacts from click to cancel as well as the turn off of the digital dialing back marketing efforts there. Can you perhaps maybe size the quantum of the digital loss within the first quarter as we're kind of thinking about it? Because I think previous comments were first half is perhaps weaker year-over-year before improving in the back half of the year in terms of the self-pay net add cadence. I just wanted to make sure if that is still the right way to think about it. Thank you again.

Question: Sebastiano Petti - JP Morgan - Analyst : Thank you.

Question: Kutgun Maral - Evercore ISI - Analyst : Good morning and thanks for taking the questions. SiriusXM subscriber results showed quite a healthy improvement compared to last year. I think churn specifically is very encouraging. And what stood up to me was that non-pay and voluntary were both lower year-over-year and that there's been minimal impact so far following the recent price ups. I'm not sure what more you can say, but any additional color would be much appreciated because of all the concerns around the macro and competitive backdrops and how we should be thinking about the trend going forward? Thank you.

Question: Kutgun Maral - Evercore ISI - Analyst : That's great thank you so much.

Question: Steven Cahall - Wells Fargo Securities, LLC - Analyst : Thanks, Jennifer, I was wondering if you could give us some more color on your new ad supported tier. So is the subscriber acquisition process there? Any different versus your current paid tier. And is there any price in how the COGS work for that in terms of like revenue share and royalties? I guess what I'm trying to get at is it sounds like this should be EBITDA accretive. Is it margin neutral? Is it margin accretive or something different? And how significant maybe could that be this year and next as you start to lean into it a little more. And then maybe just another one on the self-pay net add outlook. Is there any way to just think about how we tie up all the things that are not related to in-car core trends? So between click to cancel the promo impact and the streaming-only impact? Are we talking kind of single-digit hundreds of thousands of subs? Is it bigger or smaller than that? We just kind of love to understand that. And is that pretty much done after this year? And then we don't have to worry about those things from '26 on or how do those linger?

Question: Steven Cahall - Wells Fargo Securities, LLC - Analyst : Thank you.

Question: Jessica Reif Cohen - BofA Global Research - Analyst : Okay. So sorry about that. So two things. One, advertising is clearly going to become a more important component of revenue. What changes are you making, if any, to your sales approach, whether it's direct sales, programmatic, et cetera? And then the second thing is just in podcasting you've made an investment. Can you just talk about how you are monetizing across different platforms, your business talent that you have? And how much bigger do you hope or plan to figure out?

Question: Jessica Reif Cohen - BofA Global Research - Analyst : Thank you.

Question: Stephen Laszczyk - Goldman Sachs & Company, Inc - Analyst : Hey, great, thanks for taking the questions, Jennifer, maybe on pricing. I'm curious if you talk a little bit more about the receptivity you're seeing to some of the pricing increases. It sounds like the value exchange that you pushed down late last year, early this year has really been helping on just curious on the back of that, how perhaps you should think about the pacing of pricing increases and ARPU throughout the year. And then just to double-click on advertising on more of a real-time basis. Curious what you're hearing from your advertising partners as they settle in here past the first few weeks of tariff volatility, how it trends early into the second quarter compared to what you saw coming out of the first quarter? Thank you.

Question: Stephen Laszczyk - Goldman Sachs & Company, Inc - Analyst : Great thank you both.

Question: Barton Crockett - Rosenblatt Securities, Inc - Analyst : Okay. I was wondering if you could maybe elaborate a little bit more on the statement that you don't see real kind of risk from tariff impacts on the car market? I understand the confidence, but I'm just wondering if you could unpack you said you looked at a lot of some scenarios if you could unpack the scenarios you look at and how you came to that conclusion. And also, I think you were very particular in your verbage, you don't see an impact this year as part of this that with your long kind of trials at some of the impact would be pushed into next year. Is that part of it, if you could explain that would be helpful.

Question: Barton Crockett - Rosenblatt Securities, Inc - Analyst : Okay. And if I could just follow up, I'm just curious. If you could elaborate a little bit more on what you're hearing right now from your automaker partners in terms of things are very fluid. If you could give us any more recent update on what you're hearing from them in terms of their applications for new car sales and a possibility of an offset from used car offsetting some of the new car pressure potentially?

Question: Barton Crockett - Rosenblatt Securities, Inc - Analyst : Okay, that's very helpful. Thank you.

Question: Cameron Mansson-Perrone - Morgan Stanley - Analyst : Thank you, one follow-up just on the price hike. Pretty encouraging churn result in conjunction with that. Jennifer, I'd be curious to hear should we expect looking beyond 2025, should we expect still that you continue kind of in every other year cadence to price taking? Or does the response among the subscriber base this quarter recently changed the way you're thinking about kind of the broader pricing philosophy longer term? And then for Tom, you're pretty clear the tariffs, you don't expect to have any impact on the OpEx base subs, but I'd be curious, I'm assuming for your satellite contracts, those are largely contracted, but for the non-sat CapEx, any thoughts on risk or not to any tariff impacts there?