XM Sat 1Q loss widens despite revenue jump

XM, which is seeking regulatory approval for an acquisition by rival Sirius, said it lost $129.3 million, or 42 cents per share, compared with $122.4 million, or 40 cents per share, a year ago.

Analysts expected the loss to narrow to 39 cents per share, according to Thomson Financial.

Washington-based XM says revenue rose 17 percent to $308 million from $264 million last year, but that falls short of the $313 million expected by Wall Street.

The company finished March with 9.33 million subscribers, up from 7.9 million a year earlier. XM added a nearly identical number of subscribers -about 1.4 million -in the 12 months from April 2006 to March 2007.

The cost to acquire a new customer jumped to $73 from $65 a year ago.

Sirius most recently reported a subscriber base of 8.3 million. While smaller, Sirius has been growing at a faster rate than XM.

Nearly all of XM's subscriber growth now comes from factory-installed automobile radios, as opposed to radios purchased separately by the consumer.

In the last 12 months, the factory-installed subscriber base increased 36 percent to 3.9 million, while the retail market increased just 1 percent to 4.5 million. The rest of the subscriber base comes from smaller categories like subscriptions held by rental-car companies.

In March, the Justice Department approved the acquisition by Sirius, but it still needs approval by the Federal Communications Commission. The companies had hoped to have the deal completed by the end of 2007.