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SIRIUS XM HOLDINGS INC.

SIRIUS XM HOLDINGS INC.SIRIEarnings & Financial Report

Nasdaq · Communication Services · Radio Broadcasting Stations

XM Satellite Radio Holdings Inc. (XM) was one of the three satellite radio (SDARS) and online radio services in the United States and Canada, operated by Sirius XM Holdings. It provided pay-for-service radio, analogous to subscription cable television. Its service included 73 different music channels, 39 news, sports, talk and entertainment channels, 21 regional traffic and weather channels, and 23 play-by-play sports channels. XM channels were identified by Arbitron with the label "XM".

What changed in SIRIUS XM HOLDINGS INC.'s 10-K — 2023 vs 2024

Top changes in SIRIUS XM HOLDINGS INC.'s 2024 10-K

564 paragraphs added · 502 removed · 371 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

115 edited+48 added−48 removed47 unchanged
SiriusXM Media is the exclusive advertising sales representative for our Sirius XM and Pandora platforms. In addition to subscription fees, Sirius XM derives revenues from advertising on select non-music channels. Pandora’s primary source of revenue is the sale of audio, display and video advertising for connected device platforms, including computers and mobile devices.
SiriusXM Media is the exclusive advertising sales representative for our SiriusXM and Pandora platforms. In addition to subscription fees, Sirius XM derives revenues from advertising on select non-music channels. Pandora’s primary source of revenue is the sale of audio, display and video advertising for connected device platforms, including computers and mobile devices.
Siriusxm.com (including any other reference to such address in this Annual Report) is an inactive textual reference only, meaning that the information contained on or accessible from the website is not part of this Annual Report on Form 10-K and is not incorporated in this report by reference.
Siriusxm.com (including any other reference to such address in this Annual Report on Form 10-K) is an inactive textual reference only, meaning that the information contained on or accessible from the website is not part of this Annual Report on Form 10-K and is not incorporated in this report by reference.
We also host mandatory Conscious Inclusion training and we offer our “Can We Talk?” program, both of which are designed to explore bias and its impact, increase cultural awareness, invite open dialogue, and promote inclusive behaviors in our workplace. We also comply with the FCC’s Equal Employment Opportunity (“EEO”) rules, including making our EEO reports publicly available.
We also host Conscious Inclusion training and we offer our “Can We Talk?” program, both of which are designed to explore bias and its impact, increase cultural awareness, invite open dialogue, and promote inclusive behaviors in our workplace. We also comply with the FCC’s Equal Employment Opportunity (“EEO”) rules, including making our EEO reports publicly available.
We have entered into agreements with many automakers to include a subscription to our service in the sale or lease of vehicles which include satellite radios sold through their certified pre-owned programs. We also work directly with franchise and independent dealers on programs for non-certified used vehicles.
We have entered into agreements with many automakers to include a subscription to our service in the sale or lease of vehicles which include satellite radios sold through their certified pre-owned programs. We also work directly with franchise and independent dealers on programs for non-certified pre-owned vehicles.
We have robust talent development offerings, including training opportunities, access to LinkedIn Learning which offers an extensive content library, a mentorship program, leadership development programs, and a performance feedback program. Our talent development programs include a comprehensive goal-setting process, a career path framework, skills and core competency assessments, and custom learning paths.
We have robust talent development offerings, including training opportunities, access to LinkedIn Learning which offers an extensive content library, a mentorship program, leadership development programs, and a performance feedback program. Our talent development programs include a goal-setting process, a career path framework, skills and core competency assessments, and custom learning paths.
For the five-year period commencing January 1, 2023 and ending December 31, 2027 Pandora agreed to pay the greater of 15.1% of revenues or 26.2% of record label payments in 2023, rising over the five-year period to 15.35% of revenues or 26.2% of record label payments by 2027.
For the five-year period commencing January 1, 2023 and ending December 31, 2027, Pandora agreed to pay the greater of 15.1% of revenues or 26.2% of record label payments in 2024, rising over the five-year period to 15.35% of revenues or 26.2% of record label payments by 2027.
That project involves the implementation of new systems and products that extend from our consumer-facing SiriusXM App to the systems underlying our billing, identity, commerce and customer management functions.
This project involves the implementation of new systems and products that extend from our consumer-facing SiriusXM App to the systems underlying our billing, identity, commerce and customer management functions.
We do not have insurance policies covering our other in-orbit satellites as we consider the premium costs to be uneconomical relative to the risk of satellite failure. Terrestrial Repeaters. In some areas with high concentrations of tall buildings, such as urban centers, signals from our satellites may be blocked and reception of satellite signals can be adversely affected.
We do not carry insurance policies covering our other in-orbit satellites as we consider the premium costs to be uneconomical relative to the risk of satellite failure. Terrestrial Repeaters. In some areas with high concentrations of tall buildings, such as urban centers, signals from our satellites may be blocked and reception can be adversely affected.
SiriusXM Media also serves as the exclusive advertising representative for other third party platforms and podcasters, including such major entities as SoundCloud and NBCUniversal. SiriusXM Media has a reach of more than 150 million listeners, and gives brands, creators, and publishers access to the largest digital audio advertising platform in North America.
SiriusXM Media also serves as the exclusive advertising representative for other third party platforms and podcasters, including such major entities as SoundCloud and NBCUniversal. SiriusXM Media has a reach of more than 160 million listeners, and gives brands, creators, and publishers access to the largest digital audio advertising platform in North America.
We are the leading audio entertainment company in North America with a portfolio of audio businesses including our flagship subscription entertainment service, Sirius XM; the ad-supported and premium music streaming services of Pandora; a podcast network; an advertising sales group, SiriusXM Media; and a suite of advertising technology solutions.
We are the leading audio entertainment company in North America with a portfolio of audio businesses including our flagship subscription entertainment service, SiriusXM; the ad-supported and premium music streaming services of Pandora; a podcast network; an advertising sales group, SiriusXM Media; and a suite of advertising technology solutions.
Subscribers to the DISH Network satellite television service are not included in our subscriber counts and subscribers to our Travel Link, real-time traffic services and real-time weather services are not included in our subscriber counts, unless the applicable service is purchased by the subscriber separately and not as part of a radio subscription to our service.
Subscribers to the DISH Network satellite television service are not included in our subscriber counts nor are subscribers to our Travel Link, real-time traffic services and real-time weather services, unless the applicable service is purchased by the subscriber separately and not as part of a radio subscription to our service. Emergency Services .
In addition, our benefits programs are competitive for the markets in which we operate and may include healthcare and insurance benefits, paid time off, paid parental leave, fertility resources, advocacy resources, flexible work schedules, and employee assistance programs.
In addition, we believe our benefits programs are competitive for the markets in which we operate and may include healthcare and insurance benefits, paid time off, paid parental leave, fertility resources, flexible work schedules, and employee assistance programs.
Construction of these satellites is underway, and those satellites are expected to be launched into geostationary orbits in 2024, 2025, 2026 and 2027, respectively. Satellite Insurance. We have procured insurance for SXM-9, SXM-10, SXM-11 and SXM-12 to cover the risks associated with each satellite's launch and first year of in-orbit operation.
Construction of these satellites is underway, and those satellites are expected to be launched into geostationary orbits in 2025, 2026 and 2027, respectively. Satellite Insurance. We have procured insurance for SXM-9, SXM-10, SXM-11 and SXM-12 to mitigate the risks associated with each satellite’s launch and first year of in-orbit operation.
Competition for Subscribers and Listeners Traditional AM/FM Radio Our Sirius XM services and Pandora services compete with traditional AM/FM radio. Traditional AM/FM radio has a well-established demand for its services and offers free broadcasts paid for by commercial advertising rather than by subscription fees. Many radio stations offer information programming of a local nature, such as local news and sports.
Competition for Subscribers and Listeners Traditional AM/FM Radio Our SiriusXM services and Pandora services compete with traditional AM/FM radio. Traditional AM/FM radio has a well-established demand for its services and offers free broadcasts paid for by commercial advertising rather than by subscription fees. Many radio stations offer information programming of a local nature, such as local news and sports.
In addition, other services offered by these providers, such as cable television, on-demand video streaming, and interactive video games compete with our services to the extent they utilize existing or potential users' and listeners' time that could otherwise be allocated to the use of our Sirius XM or Pandora services.
In addition, other services offered by these providers, such as cable television, on-demand video streaming, and interactive video games, compete with our services to the extent they utilize existing or potential users' and listeners' time that could otherwise be allocated to the use of our SiriusXM or Pandora services.
For the ten-year period commencing January 1, 2018 and ending on December 31, 2027, the CRB set the royalty rate payable by us under the statutory license covering the performance of sound recordings over our Sirius XM satellite radio service, and the making of ephemeral (server) copies in support of such performances, to be 15.5% of gross revenues, subject to exclusions and adjustments.
For the ten-year period commencing January 1, 2018 and ending on December 31, 2027, the CRB set the royalty rate payable by us under the statutory license covering the performance of sound recordings over our SiriusXM satellite radio service, and the making of ephemeral copies in support of such performances, to be 15.5% of gross revenues, subject to exclusions and adjustments.
Podcasts submitted through this portal are offered to subscribers of Pandora’s ad-supported service as an additional benefit. Through our Simplecast business, we also offer a podcast management and analytics platform, allowing us to offer podcasters a solution for management, hosting, analytics and advertising sales.
Podcasts submitted through this portal are offered to subscribers of Pandora’s ad-supported service as an additional benefit. Through Simplecast, we also offer a comprehensive podcast management and analytics platform, allowing us to offer podcasters a solution for management, hosting, analytics and advertising sales.
The transfer of such equipment, services and technical data outside the United States or to foreign persons is subject to strict export control and prior approval 13 Table of Contents requirements from the United States government (including prohibitions on the sharing of certain satellite-related goods and services with China).
The transfer of such equipment, services and technical data outside the United States or to foreign persons is subject to strict export control and prior approval requirements from the United States government (including prohibitions on the sharing of certain satellite-related goods and services with China).
We also reimburse various automakers for certain costs associated with the satellite radios installed in new vehicles, including in certain cases hardware costs, engineering expenses and promotional and advertising expenses. 7 Table of Contents Previously Owned Vehicles We acquire subscribers through the sale and lease of previously owned vehicles with factory-installed satellite radios.
We also reimburse various automakers for certain costs associated with the satellite radios installed in new vehicles, including in certain cases hardware costs, engineering expenses and promotional and advertising expenses. Previously Owned Vehicles We acquire subscribers through the sale and lease of previously owned vehicles with factory-installed satellite radios.
The radio service offered by direct broadcast satellite and cable audio is often included as part of a package of digital services with video service, and video customers generally do not pay an additional monthly charge for the audio service.
The radio 15 Table of Contents service offered by direct broadcast satellite and cable audio is often included as part of a package of digital services with video service, and video customers generally do not pay an additional monthly charge for the audio service.
Our Satellite Radio Systems Our satellite radio systems are designed to provide clear reception in most areas of the continental United States despite variations in terrain, buildings and other obstructions. We continually monitor our infrastructure and regularly evaluate improvements in technology.
Our Satellite Radio Systems Our satellite radio systems are designed to deliver clear reception across most areas of the continental United States despite variations in terrain, buildings and other obstructions. We continually monitor our infrastructure and regularly evaluate improvements in technology.
Our Sirius XM and Pandora services use both statutory and direct music licenses as part of their businesses. We license varying rights - such as performance and mechanical rights - for use in our Sirius XM and Pandora services based on the various radio and interactive services they offer.
Our SiriusXM and Pandora services use both statutory and direct music licenses as part of their businesses. We license varying rights - such as performance and mechanical rights - for use in our SiriusXM and Pandora services based on the various radio and interactive services they offer.
Other Digital Media Services The audio entertainment marketplace continues to evolve rapidly, with a steady emergence of new media platforms that compete with both our Sirius XM and Pandora services now or that could compete with those services in the future.
Other Digital Media Services The audio entertainment marketplace continues to evolve rapidly, with a steady emergence of new media platforms that compete with both our SiriusXM and Pandora services now or that could compete with those services in the future.
We expect that 360L will be included in a majority of vehicles that include Sirius XM functionality in the future. 360L allows us to take advantage of advanced in-dash infotainment systems. 360L is intended to leverage the ubiquitous signal coverage and low delivery costs of our satellite infrastructure with the two-way communication capability of a wireless streaming service to provide consumers seamless access to our content, including our live channels, on demand service, podcasts and personalized music services.
We expect that 360L will be included in a majority of vehicles that include SiriusXM functionality in the future. 360L allows us to take advantage of advanced in-dash infotainment systems. 360L is intended to leverage the ubiquitous signal coverage and low delivery costs of our satellite infrastructure with the two-way communication capability of a wireless 10 Table of Contents streaming service to provide consumers seamless access to our content, including our live channels, on demand service, podcasts and personalized music services.
Pandora enables listeners to create personalized stations and playlists, discover new content, hear artist- and expert-curated playlists and podcasts as well as search and play songs and albums on-demand. Pandora is available as (1) an ad-supported 5 Table of Contents radio service, (2) a radio subscription service (Pandora Plus) and (3) an on-demand subscription service (Pandora Premium).
Pandora enables listeners to create personalized stations and playlists, discover new content, hear artist- and expert-curated playlists and podcasts as well as search and play songs and albums on-demand. Pandora is available as (1) an ad-supported radio service, (2) a radio subscription service (Pandora Plus) and (3) an on-demand subscription service (Pandora Premium).
AdsWizz’s third party customers include well-known music platforms, podcasts and broadcasting groups worldwide. Simplecast Pandora, through its Simplecast business, also offers a podcast management and analytics platform. Simplecast complements AdsWizz’s advertising technology platform, allowing the company to offer podcasters a solution for management, hosting, analytics and advertising sales.
AdsWizz’s third party customers include well-known music platforms, podcasts and broadcasting groups worldwide. 14 Table of Contents Simplecast Pandora, through its Simplecast business, also offers a podcast management and analytics platform. Simplecast complements AdsWizz’s advertising technology platform, allowing the company to offer podcasters a solution for management, hosting, analytics and advertising sales.
Our annual, quarterly and current reports, and any amendments to those reports, filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), may be accessed free of charge through our website as soon as reasonably practicable after we have electronically filed or furnished such material with the SEC.
Our annual, quarterly and current reports, and any amendments to those reports, filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act, may be accessed free of charge through our website as soon as reasonably practicable after we have electronically filed or furnished such material with the SEC.
Trademarks Sirius XM Business We have registered, and intend to maintain, the trademarks “Sirius”, “XM”, “SiriusXM” and “SXM” with the United States Patent and Trademark Office in connection with the services we offer.
Trademarks SiriusXM Business We have registered, and intend to maintain, the trademarks “Sirius”, “XM”, “SiriusXM” and “SXM” with the United States Patent and Trademark Office in connection with the services we offer.
Pandora must also license reproduction rights, which are also referred to as mechanical rights, to offer the interactive features of the Pandora services. For our Pandora subscription services, copyright holders receive payments for these rights at the rates determined in accordance with the statutory license set forth in Section 115 of the United States Copyright Act.
Pandora must also license mechanical rights to offer the interactive features of the Pandora services. For our Pandora subscription services, copyright holders receive payments for these rights at the rates determined in accordance with the statutory license set forth in Section 115 of the United States Copyright Act.
Human Capital Resources Overview As of December 31, 2023, we had 5,680 full-time and part-time employees whose skills span a wide range of highly specialized capabilities. Our core voluntary full-time employee turnover rate in 2023 was approximately 6.2%.
Human Capital Resources Overview As of December 31, 2024, we had 5,515 full-time and part-time employees whose skills span a wide range of highly specialized capabilities. Our core voluntary full-time employee turnover rate in 2024 was approximately 6.6%.
In addition, you may automatically receive email alerts and other information about us when you enroll your email address by visiting the “Email Alerts” section under the “Shareholder Services” heading at http://investor.siriusxm.com/investor-overview. 17 Table of Contents Information About Our Executive Officers Certain information regarding our executive officers as of January 30, 2024 is provided below: Name Age Position Jennifer C.
In addition, you may automatically receive email alerts and other information about us when you enroll your email address by visiting the “Email Alerts” section under the “Shareholder Services” heading at http://investor.siriusxm.com/investor-overview. Information About Our Executive Officers Certain information regarding our executive officers as of January 28, 2025 is provided below: Name Age Position Jennifer C.
Pandora Premium also includes a “share” feature where consumers can share their stations, songs, albums, podcasts or playlists through social media, messaging applications and email. 10 Table of Contents SiriusXM Media SiriusXM Media is an advertising sales group spanning our Sirius XM and Pandora audio entertainment services.
Pandora Premium also includes a “share” feature where consumers can share their stations, songs, albums, podcasts or playlists through social media, messaging applications and email. SiriusXM Media SiriusXM Media is an advertising sales group spanning our SiriusXM and Pandora audio entertainment services.
SiriusXM Media has a reach of more than 150 million monthly listeners, and gives brands, creators, and publishers access to the largest digital audio advertising platform in North America. SiriusXM Media offers advertisers the ability to execute campaigns in the United States across various platforms, including Pandora and SoundCloud.
SiriusXM Media has a reach of more than 160 million monthly listeners, and gives brands, creators, and publishers access to the largest digital audio advertising platform in North America. SiriusXM Media enables advertisers the ability to run campaigns across multiple platforms in the United States, including Pandora and SoundCloud.
We provide equipment to artists and hosts to enable remote creation and transmission of programming. Radios We do not manufacture radios. We have authorized manufacturers and distributors to produce and distribute radios, and have licensed our technology to various electronics manufacturers to develop, manufacture and distribute radios under certain brands.
To facilitate flexibility, we provide equipment to artists and hosts to enable the creation and transmission of programming from other locations. Radios We do not manufacture radios. We have authorized manufacturers and distributors to produce and distribute radios, and have licensed our technology to various electronics manufacturers to develop, manufacture and distribute radios under certain brands.
We do manage various aspects of the production of satellite radios. To facilitate the sale of radios, we may subsidize a portion of the radio manufacturing costs to reduce the hardware price to consumers. Connected Vehicle Services We provide connected vehicle services to several automakers.
We do manage various aspects of the production of satellite radios. To facilitate the sale of radios, we may subsidize a portion of the radio manufacturing costs to reduce the hardware price to consumers.
Witz has served as our Chief Executive Officer since January 1, 2021. From March 2019 through December 2020, she was our President, Sales, Marketing and Operations. From August 2017 until March 2019 she was our Executive Vice President, Chief Marketing Officer. Ms. Witz joined us in March 2002 and has served in a variety of senior financial and operating roles.
From March 2019 through December 2020, she was our President, Sales, Marketing and Operations. From August 2017 until March 2019 she was our Executive Vice President, Chief Marketing Officer. Ms. Witz joined us in March 2002 and has served in a variety of senior financial and operating roles. Before joining Sirius XM, Ms.
SiriusXM Podcast Network We license original podcasts from their creators, and we also provide podcast advertising services that generate revenue from over 450 shows. We create and distribute original podcasts licensed from third parties through platforms such as the iPhone podcast App.
SiriusXM Podcast Network We license original podcasts from their creators and provide podcast advertising services generating revenue from nearly 700 shows. We create and distribute original podcasts licensed from third parties through platforms such as the iPhone podcast App.
Two of these satellites, FM-5 and FM-6, transmit our service on frequencies originally licensed by the Federal Communications Commission (the “FCC”) to Sirius, and two of these satellites, XM-5 and SXM-8, transmit our service on frequencies originally licensed by the FCC to XM. Our XM-3 satellite serves as a spare for the XM system.
Two of these satellites, FM-5 and FM-6, transmit our service on frequencies originally licensed by the Federal Communications Commission (the “FCC”) to Sirius, and two of these satellites, XM-5 and SXM-8, transmit our service on frequencies originally licensed by the FCC to XM.
There are approximately 160 million vehicles in operation with Sirius XM radios, and the proliferation of smart speakers and other connected devices, including our webplayer and the SiriusXM App, has increased the range of options consumers have for engaging with and consuming our content. In 2023, we began an extensive project to update our digital infrastructure.
There are approximately 167 million vehicles in operation with SiriusXM radios, and the proliferation of smart speakers and other connected devices, including our web player and the SiriusXM App, has increased the range of options consumers have for engaging with and consuming our content. In 2024, we continued an extensive digital infrastructure update that began in 2023.
Our FCC licenses for our FM-5 satellite expires in 2025, our FM-6 satellite license expires in 2030, our XM-3 satellite license expires in 2026, our XM-5 satellite license expires in 2026, and our SXM-8 satellite license expires in 2029.
Our FCC licenses for our FM-5 satellite expires in 2025, our FM-6 satellite license expires in 2030, our XM-3 satellite license expires in 2026, our XM-5 satellite license expires in 2026, our SXM-8 satellite license expires in 2029, and our SXM-9 satellite license is expected to expire in 2033.
In certain cases, we receive subscription payments from automakers in advance of the activation of our service. We share with certain automakers a portion of the revenues we derive from subscribers using vehicles equipped to receive our service.
Most automakers include a trial subscription to our service in the sale or lease of their new vehicles. In certain cases, we receive subscription payments from automakers in advance of the activation of our service. We share with certain automakers a portion of the revenues we derive from subscribers using vehicles equipped to receive our service.
We have agreements with makers of electric vehicles, such as Lucid and Rivian, to include the SiriusXM experience as part of their vehicles. We also have entered into agreements with third parties designed to increase the distribution and ease of use of our streaming service, including through connected devices.
We have agreements with leading electric vehicle manufacturers, including Tesla, Lucid and Rivian, to integrate the SiriusXM experience into their vehicles. We also have entered into agreements with third parties designed to increase the distribution and ease of use of our streaming service, including through connected devices.
We also offer a portal, “Simplecast Creator Connect,” for podcasters to share their podcasts with new audiences and gather data about their shows. Podcasts submitted through this portal are offered to subscribers of Pandora’s ad-supported service as an additional benefit.
We also offer a portal, “Simplecast Creator Connect,” for podcasters to share their podcasts with new audiences and gather data about their shows. Podcasts submitted through this portal are offered to subscribers of Pandora’s ad-supported service as an additional benefit. Artificial Intelligence We utilize advanced artificial intelligence (“AI”) algorithms and technologies to enhance various aspects of our operations.
Our streaming service currently features: the broad range of music, sports, talk, news and entertainment channels available on satellite radio; access to over 200 additional music channels; on-demand new and archive episodes of SiriusXM shows and specials, and video content, including video from The Howard Stern Show, encompassing in-studio performances, interviews and behind-the-scenes moments with artists, personalities and newsmakers.
Consumers can access our streaming service on iOS and Android mobile devices, web browsers, and other internet connected devices. 9 Table of Contents Our streaming service currently features: the broad range of music, sports, talk, news and entertainment channels available on satellite radio; access to over 200 additional music channels; on-demand new and archive episodes of SiriusXM shows and specials; and video content, including video from The Howard Stern Show, featuring in-studio performances, interviews and behind-the-scenes moments with artists, personalities and newsmakers.
We operate over 1,000 terrestrial repeaters across the United States as part of our systems. Other Satellite Facilities. We control and communicate with our satellites from facilities in North America.
We operate over 1,000 terrestrial repeaters across the United States as part of our systems. Other Satellite Facilities. We control and communicate with our satellites from facilities in North America. Our satellites are monitored, tracked and controlled by a third party satellite operator.
Listeners of the ad-supported service are provided with the option to temporarily access on-demand listening, including certain features of the Pandora Premium service. We refer to this temporary access as “Premium Access”.
Listeners of the ad-supported service are provided with the option to temporarily access on-demand listening, including certain features of the Pandora Premium service.
In 2023, we paid a per performance rate for the streaming of certain sound recordings of $0.0030 on our Sirius XM streaming service which increased from $0.0028 in 2022. In 2024, we expect to pay a per performance rate for the streaming of certain sound recordings of $0.0031 on our Sirius XM streaming service. Pandora Services.
In 2024, we paid a per performance rate for the streaming of certain sound recordings of $0.0031 on our SiriusXM streaming service which increased from $0.0030 in 2023. In 2025, we expect to pay a per performance rate for the streaming of certain sound recordings of $0.0032 on our SiriusXM streaming service. 18 Table of Contents Pandora Services.
We have agreements with major automakers to offer satellite radios in their vehicles. Satellite radios are available as a factory-installed feature in substantially all vehicle makes sold in the United States. Most automakers include a trial subscription to our service in the sale or lease of their new vehicles.
Distribution of Radios New Vehicles We distribute satellite radios through the sale and lease of new vehicles, and we have agreements with major automakers to offer satellite radios in their vehicles. Satellite radios are available as a factory-installed feature in substantially all vehicle makes sold in the United States.
The wireless streaming connection included in 360L enables enhanced search and recommendations functions, making discovery of our content in the vehicle easier. 360L also provides us data on how our subscribers use our service. Distribution of Radios New Vehicles We distribute satellite radios through the sale and lease of new vehicles.
The wireless streaming connection included in 360L enables enhanced search and recommendations functions, making discovery of our content in the vehicle easier. 360L also provides us data on how our subscribers use our service.
SiriusXM Media SiriusXM Media is an advertising sales group spanning our SiriusXM and Pandora audio entertainment services. SiriusXM Media also sells advertising on audio platforms and in podcasts unaffiliated with us and serves as the exclusive advertising representative for other third party platforms and podcasters, including such major entities as SoundCloud and NBCUniversal.
SiriusXM Media SiriusXM Media is our advertising sales group that supports both the SiriusXM and Pandora audio entertainment services. SiriusXM Media also sells advertising on audio platforms and in podcasts unaffiliated with us and serves as the exclusive advertising representative for other third party platforms and podcasters.
Through our engagement surveys and other communication channels, we have learned a tremendous amount about our workforce and this knowledge shaped the people-focused initiatives we prioritized in 2023. We believe that our culture is a long-term competitive advantage for us, fuels our ability to execute, and underpins our employee talent strategy.
Through our engagement surveys and other communication channels, we have learned about our workforce and this knowledge shaped the people-focused initiatives we prioritized in 2024. We believe that our culture fuels our ability to execute, and underpins our employee talent strategy.
Our Sirius XM Business As operators of a privately-owned satellite system, we are regulated by the FCC under the Communications Act of 1934, principally with respect to: • the licensing of our satellite systems; • preventing interference with or to other users of radio frequencies; and • compliance with FCC rules established specifically for U.S. satellites and satellite radio services.
Our SiriusXM Business As operators of a privately-owned satellite system, we are regulated by the FCC under the Communications Act of 1934, principally with respect to: • the licensing of our satellite systems; • preventing interference with or to other users of radio frequencies; and • compliance with FCC rules established specifically for U.S. satellites and satellite radio services. 16 Table of Contents Any assignment or transfer of control of our FCC licenses must be approved in advance by the FCC.
Certain automakers now provide embedded streaming connectivity that supports and makes available the Pandora service in vehicles without the need for smartphone connectivity. In addition, our Pandora service is integrated into consumer electronic, voice-based devices and smart speakers.
The Pandora application is free to download and use. Our Pandora service is also available in vehicles in the United States with smartphone connectivity. Certain automakers provide embedded streaming connectivity that supports and makes available the Pandora service in vehicles without the need for smartphone connectivity. Additionally, our Pandora service is integrated into consumer electronic, voice-based devices and smart speakers.
Premium Access is also available to Pandora Plus listeners. On-Demand Subscription Service (Pandora Premium) Pandora offers Pandora Premium – an on-demand subscription service that combines the radio features of Pandora Plus with an on-demand experience.
Content provided to each listener of Pandora Plus is more tailored when the listener interacts with the platform. Premium Access is also available to Pandora Plus listeners. On-Demand Subscription Service (Pandora Premium) Pandora offers Pandora Premium – an on-demand subscription service that combines the radio features of Pandora Plus with an on-demand experience.
Before joining Sirius XM, Ms. Witz was Vice President, Planning and Development, at Viacom Inc., a global media company, and prior to that she was Vice President, Finance and Corporate Development, at Metro-Goldwyn-Mayer, Inc., an entertainment company focused on the production and global distribution of film and television content. Ms.
Witz was Vice President, Planning and Development, at Viacom Inc., a global media company, and prior to that she was Vice President, Finance and Corporate Development, at Metro-Goldwyn-Mayer, Inc., an entertainment company focused on the production and global distribution of film and television content. Ms. Witz began her career in the Investment Banking Department at Kidder, Peabody & Co Inc.
As of December 31, 2023, Pandora had approximately 6.0 million subscribers. The majority of revenue from our Pandora service is generated from advertising on our Pandora ad-supported radio service. We also derive subscription revenue from our Pandora Plus and Pandora Premium subscribers.
As of December 31, 2024, Pandora had approximately 5.8 million subscribers. The majority of revenue from our Pandora service is generated from advertising on Pandora’s ad-supported radio service. Pandora also derives subscription revenue from its Pandora Plus and Pandora Premium subscribers.
The FCC has established rules governing terrestrial repeaters and has granted us a license through 2027 to operate our repeater network. In certain cases, we obtain FCC certifications for satellite radios, including satellite radios that include FM modulators. We believe our radios that are in production comply with all applicable FCC rules.
In some areas, we have installed terrestrial repeaters to supplement our satellite signal coverage. The FCC has established rules governing terrestrial repeaters and has granted us a license through 2027 to operate our repeater network. In certain cases, we obtain FCC certifications for satellite radios, including satellite radios that include FM modulators.
Set forth below is a brief overview of the music composition and sound recording licenses employed by our Sirius XM and Pandora services. These music licensing arrangements are complex and the description below is only a summary of these complicated licensing arrangements.
Set forth below is a brief overview of the complex licensing arrangements for music composition and sound recording rights for our SiriusXM and Pandora services. The description below is only a summary of these complex licensing arrangements.
We are required to obtain export licenses or other approvals from the United States government to export certain equipment, services and technical data related to our satellites and their operations.
We believe our radios that are in production comply with all applicable FCC rules. We are required to obtain export licenses or other approvals from the United States government to export certain equipment, services and technical data related to our satellites and their operations.
Our Pandora and Off-platform business also sells advertising on other audio platforms and in widely distributed podcasts, which we consider to be off-platform services. Podcasting In 2023, an estimated 120 million Americans listened to a podcast at least monthly. In 2020, Sirius XM acquired Stitcher, a leader in the distribution of podcasts.
Our Pandora and Off-platform business also sells advertising on other audio platforms and in widely distributed podcasts, which we consider to be off-platform services. 8 Table of Contents Podcasting In 2024, an estimated 135 million Americans listened to a podcast at least monthly.
Sirius XM also holds a 70% equity interest and 33% voting interest in Sirius XM Canada Holdings Inc. (“Sirius XM Canada”). Pandora and Off-platform Our Pandora service operates a music, comedy and podcast streaming platform, offering a personalized experience for each listener wherever and whenever they want to listen, whether through mobile devices, car speakers or connected devices.
Pandora and Off-platform Our Pandora service operates a music, comedy and podcast streaming platform, offering a personalized experience for each listener wherever and whenever they want to listen, whether through mobile devices, car speakers or connected devices.
The Sirius XM service is distributed through our two proprietary satellite radio systems and streamed via applications for mobile devices, home devices and other consumer electronic equipment. Radios are primarily distributed through automakers, retailers and our website.
SiriusXM’s content bundles include live, curated and certain exclusive and on demand programming. The SiriusXM service is distributed through our two proprietary satellite radio systems and streamed via applications for mobile devices, home devices and other consumer electronic equipment. Radios are primarily distributed through automakers, retailers and SiriusXM’s website.
Together, we represent different dimensions of diversity and we are committed to fostering an environment where all of our employees can thrive and reach their full potential. 15 Table of Contents We encourage our employees to voluntarily self-identify their gender, race, ethnicity, veteran and disability status.
Together, we represent different dimensions of diversity and are committed to fostering an environment where all of our employees can thrive and reach their full potential. We encourage our employees to voluntarily self-identify their gender, race, ethnicity, veteran and disability status. Understanding our employee demographics enables us to shape our talent strategy and invest time and resources in various initiatives.
Donnelly has served as our Executive Vice President, General Counsel and Secretary, since May 1998. From June 1997 to May 1998, he was Vice President and Deputy General Counsel of ITT Corporation, a hotel, gaming and entertainment company that was acquired by Starwood Hotels & Resorts Worldwide, Inc. in February 1998.
From June 1997 to May 1998, he was Vice President and Deputy General Counsel of ITT Corporation, a hotel, gaming and 21 Table of Contents entertainment company that was acquired by Starwood Hotels & Resorts Worldwide, Inc. in February 1998. From October 1995 to June 1997, he was assistant general counsel of ITT Corporation. Prior to October 1995, Mr.
Our Artist Stations feature, which allows subscribers to create their own customized ad-free music stations within the SiriusXM App and on capable 360L in-vehicle radios, is offered to consumers as part of our All Music Plan, All Access (App only), Streaming Platinum and Platinum plans.
In addition, we offer an Artist Stations feature as part of substantially all our plans , which allows subscribers to create their own customized ad-free music stations based on their favorite artists within the SiriusXM app and on capable 360L in-vehicle radios .
Certain of these services include advanced functionality, such as personalization and customization and allow the user to access large libraries of content. These services, in some instances, are also offered through devices sold by the service providers including Apple, Google and Amazon. These services compete with our services, at home, in vehicles, and wherever audio entertainment is consumed.
These services, in some instances, are also offered through devices sold by the service providers including Apple, Google and Amazon. These services compete with our services, at home, in vehicles, and wherever audio entertainment is consumed.
Our Sirius XM business does not require a mechanical license. Pandora Services. We have arrangements with ASCAP, BMI, SESAC, GMR and a variety of other copyright owners to license the musical compositions performance rights we use on our Pandora services.
Pandora Services . We have arrangements with ASCAP, BMI, SESAC, GMR and a variety of other copyright owners to license the musical compositions performance rights we use on our Pandora services. We have not agreed on the rates and terms for definitive licenses between Pandora and either ASCAP or BMI.
In addition, we have arrangements with various services and consumer electronics manufacturers to include the Sirius XM streaming functionality with their service and devices. 360L Our advanced automotive platform, which we call “360L,” combines our satellite and streaming services into a single, cohesive in-vehicle entertainment experience.
In addition, we have arrangements with various services and consumer electronics manufacturers to include the SiriusXM streaming functionality with their service and devices. 360L Our advanced automotive platform, “360L,” integrates satellite and streaming services into a seamless in-vehicle entertainment experience. We have agreements with many automakers to deploy our 360L interface in a variety of vehicles.
Our satellites are monitored, tracked and controlled by a third party satellite operator. 8 Table of Contents Studios Our programming originates from studios in New York City, Los Angeles, Miami, Nashville and Washington D.C. and, to a lesser extent, from smaller studios in a variety of venues across the country. Our corporate headquarters is in New York City.
Studios Our programming originates from studios in New York City (where our corporate headquarters are located), Los Angeles, Miami, Nashville, Las Vegas and Washington D.C. and, to a lesser extent, from smaller studios in a variety of venues across the country.
Corporate Information and Available Information Our executive offices are located at 1221 Avenue of the Americas, 35th floor, New York, New York 10020 and our telephone number is (212) 584-5100. Our internet address is www.siriusxm.com.
To support the well-being of our employees and their families we also offer resources focused on physical, mental, and emotional health. Corporate Information and Available Information Our executive offices are located at 1221 Avenue of the Americas, 35th floor, New York, New York 10020 and our telephone number is (212) 584-5100. Our internet address is www.siriusxm.com.
We continue to expand the range of choices for our listeners – both in terms of compelling content and the array of ways in which it can be consumed.
Our vision is to shape the future of audio where everyone is effortlessly connected to the voices, stories and music they love. We continue to expand the range of choices for our listeners – both in terms of compelling content and the array of ways in which it can be consumed.
Many of our employees are members of our employee resource groups, known as SiriusXM Communities, which were established for the purpose of supporting, nurturing, and empowering under-represented members of our workforce.
Many of our employees are members of our employee resource groups, known as SiriusXM Communities, which were established for the purpose of supporting, nurturing, and empowering under-represented members of our workforce. 19 Table of Contents We prioritize cultural awareness, celebrate inclusion and diversity, and educate our workforce on our anti-harassment and discrimination policies.
SiriusXM Cares has three focus areas for giving: Employee, Social Equity, and Corporate; and through these focus areas, we are able to give directly or bolster employee giving efforts. Through our focus on the Employee, we invite employees to give to the causes most meaningful to them.
How We Give Back SiriusXM Cares is the name of our philanthropic effort to promote charitable giving. SiriusXM Cares has three focus areas for giving: Employee, Social Equity, and Corporate; and through these focus areas, we give directly or bolster employee giving efforts.
Subscription Radio Service (Pandora Plus) Pandora offers Pandora Plus – an ad-free, subscription version of the radio service that includes options for replaying songs, skipping songs, offline listening, and higher quality audio on supported devices. Content provided to each listener of Pandora Plus is more tailored when the listener interacts with the platform.
We refer to this temporary access as “Premium Access”. 13 Table of Contents Subscription Radio Service (Pandora Plus) Pandora offers Pandora Plus – an ad-free, subscription version of the radio service that includes options for replaying songs, skipping songs, offline listening, and higher quality audio on supported devices.
For our Pandora ad-supported radio service, certain copyright holders receive as a performance royalty their usage-based and ownership-based share of a royalty pool equal to 21.5% of the content acquisition costs that we pay for sound recordings on our ad-supported service and others receive a fixed fee.
Currently, we have interim licenses with ASCAP and BMI relating to Pandora. For our Pandora ad-supported radio service, certain copyright holders receive as a performance royalty a fee based on usage and their ownership share of the works that Pandora plays, and other copyright holders receive a fixed fee.
The changing market for musical compositions may have an adverse effect on our Sirius XM and Pandora services, including increasing our costs and limiting the musical works available to us. Sirius XM Service. We have arrangements with ASCAP, BMI, SESAC, and GMR to license the musical compositions we perform on our satellite radio and streaming services.
SiriusXM Service . We have arrangements with ASCAP, BMI, SESAC and GMR to license the musical compositions we perform on our satellite radio and streaming services. Currently, we have an interim license with BMI.
From 1999 until 2002, he was Chairman of USA Films, a motion picture production, marketing and distribution company. From 1997 until 1999, Mr. Greenstein was Co-President of October Films, a motion picture production, marketing and distribution company. Prior to joining October Films, Mr.
Scott A. Greenstein has served as our President, Chief Content Officer, since May 2004. Prior to May 2004, Mr. Greenstein was Chief Executive Officer of The Greenstein Group, a media and entertainment consulting firm. From 1999 until 2002, he was Chairman of USA Films, a motion picture production, marketing and distribution company. From 1997 until 1999, Mr.
We anticipate that, absent significant misconduct on our part, the FCC will renew our licenses to permit operation of our satellites for their useful lives, and grant licenses for any replacement satellites. In some areas, we have installed terrestrial repeaters to supplement our satellite signal coverage.
Our SXM-7 satellite license expires in 2029, although SXM-7 is not in active use due to payload failures that occurred during in-orbit testing. We anticipate that, absent significant misconduct on our part, the FCC will renew our licenses to permit operation of our satellites for their useful lives, and grant licenses for any replacement satellites.
As of December 31, 2023, the principal amount outstanding on that loan was $8 million. As of December 31, 2023, Sirius XM Canada had approximately 2.6 million subscribers.
As of December 31, 2024, the principal amount outstanding on that loan was $7 million. As of December 31, 2024, Sirius XM Canada had approximately 2.5 million subscribers. Sirius XM Canada’s subscribers are not included in our subscriber count or subscriber-based operating metrics.
Our connected vehicle services are designed to enhance the safety, security and driving experience for vehicle operators while providing marketing and operational benefits to automakers and their dealers. We offer a portfolio of location-based services through two-way wireless connectivity, including safety, security, convenience, maintenance and data services, remote vehicle diagnostics, and stolen or parked vehicle locator services.
We support a portfolio of location-based services through two-way wireless connectivity, including safety, security, convenience, maintenance and data services, remote vehicle diagnostics, and stolen or parked vehicle locator services. Subscribers to our connected vehicle services are not included in our subscriber count or subscriber-based operating metrics. Other Services Commercial Accounts.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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As consumer tastes and preferences change on the internet and with mobile and other connected products, including cars, in-home, and wearable devices, we will need to enhance and improve our existing services, introduce new services and features, and attempt to maintain our competitive position with additional technological advances and adaptable platforms.
As consumer tastes and preferences change on the internet and with mobile and other connected products, including cars, in-home, and wearable devices, we will need to enhance and improve our existing products and services, introduce new services and features, and attempt to maintain our competitive position with additional technological advances and adaptable platforms.
If we fail to accurately predict and play music, comedy or other content that our Pandora listeners enjoy, we may fail to retain existing and attract new listeners. A key differentiating factor between our Pandora service and other music content providers is our ability to predict music that our listeners will enjoy.
If we fail to accurately predict and play music, comedy or other content that our Pandora listeners enjoy, we may fail to retain existing listeners and attract new listeners. A key differentiating factor between our Pandora service and other music content providers is our ability to predict music that our listeners will enjoy.
Some of our services and technologies may use “open source” software, which may restrict how we use or distribute our services or require that we release the source code subject to those licenses. We may incorporate in some products software licensed under “open source” licenses.
Some of our services and technologies use “open source” software, which may restrict how we use or distribute our services or require that we release the source code subject to those licenses. We incorporate in some products software licensed under “open source” licenses.
The rapid evolution of AI, including potential government regulation of AI, will require significant resources to develop, test and maintain our platform, offerings, services, and features to help us implement AI ethically in order to minimize unintended, harmful impact. Interruption or failure of our information technology and communications systems could impair the delivery of our service and harm our business.
The rapid evolution of AI, including the government regulation of AI, will require significant resources to develop, test and maintain our platform, offerings, services, and features to help us implement AI ethically in order to minimize unintended, harmful impact. Interruption or failure of our information technology and communications systems could impair the delivery of our service and harm our business.
The operation of our apps and service offerings could be impaired if errors occur in the third party software that supports our apps and services. It may be difficult for us to correct any defects in third party software because the development and maintenance of the software is not within our control.
The operation of our apps and service offerings could be impaired if errors occur in the software, including third party software, that supports our apps and services. It may be difficult for us to correct any defects in third party software because the development and maintenance of the software is not within our control.
We also compete for the time and attention of our listeners with providers of other in-home and mobile entertainment services, and we compete for advertising sales with large scale online advertising platforms, such as Amazon, Facebook and Google, and with traditional media outlets.
We also compete for the time and attention of our listeners with providers of other in-home and mobile entertainment services, and we compete for advertising sales with large scale online advertising platforms, such as YouTube, Amazon, Facebook and Google, and with traditional media outlets.
Our ability to reach consumers with radio and television advertising, performance and digital media, direct mail materials, email solicitations and telephone calls is an important part of our efforts and a significant factor in the effectiveness of our marketing.
Our ability to reach consumers with radio and television advertising, performance and digital media, direct mail materials, email solicitations, telephone calls and digital campaigns is an important part of our efforts and a significant factor in the effectiveness of our marketing.
Our ability to attract and retain advertisers, and ultimately to sell our advertising inventory, depends on a number of factors, including: • the number of listener hours on the Pandora ad-supported service, particularly the number of listener hours attributable to high-value demographics; • keeping pace with changes in technology and our competitors, some of which have significant influence over the distribution of our Pandora app; • competing effectively for advertising with other dominant online services, such as Spotify, Google, Facebook and YouTube, as well as other marketing and media outlets; • successfully competing for local radio advertising; • demonstrating the ability of advertisements to reach targeted audiences, including the value of mobile digital advertising; • ensuring that new ad formats and ad product offerings are attractive to advertisers and that inventory management decisions (such as changes to ad load, frequency, prominence and quality of ads that we serve listeners) do not have a negative impact on listener hours; and • adapting to technologies designed to block the display of our ads.
Our ability to attract and retain advertisers, and ultimately to sell our advertising inventory, depends on a number of factors, including: • the number of listener hours on the Pandora ad-supported service, particularly the number of listener hours attributable to high-value demographics; • keeping pace with changes in technology and our competitors, some of which have significant influence over the distribution of our Pandora app; • competing effectively for advertising with other dominant online products and services, such as Spotify, Google, Facebook and YouTube, as well as other marketing and media outlets; • demonstrating the ability of advertisements to reach targeted audiences, including the value of mobile digital advertising; • ensuring that new ad formats and ad product offerings are attractive to advertisers and that inventory management decisions (such as changes to ad load, frequency, prominence and quality of ads that we serve listeners) do not have a negative impact on listener hours; and • adapting to technologies designed to block the display of our ads.
If we are unable to reach consumers through email solicitations or telemarketing, including as a result of “spam” and email filters, call blocking technologies, restriction in digital media on identifying users, such as limits on “cookies,” consumer privacy regulations or “do-not-call” or other marketing regulations, our marketing efforts will be adversely affected.
If we are unable to reach consumers through email solicitations or telemarketing, including as a result of “spam” and email filters, call blocking technologies, restrictions in digital media on identifying users, such as limits on “cookies,” consumer privacy regulations, “do-not-call” and other marketing regulations, our marketing efforts will be adversely affected.
We may not realize the benefits of acquisitions or other strategic investments and initiatives. Our strategy has included and may include selective acquisitions, other strategic investments and initiatives to expand our business.
We may not realize the benefits of acquisitions or other strategic investments and initiatives. Our strategy has included and may include selective acquisitions, other strategic investments and initiatives to expand or reorganize our business.
The costs of maintaining adequate protection, including insurance protection, against such threats as they develop in the future (or as legal requirements related to data security increase) could be material. In addition, hardware, software, or applications we develop or procure from third parties may contain defects in design or manufacture or other problems that could unexpectedly compromise information security.
The costs of maintaining adequate protection against such threats as they develop in the future (or as legal requirements related to data security increase) could be material. In addition, hardware, software, or applications we develop or procure from third parties may contain defects in design or manufacture or other problems that could unexpectedly compromise information security.
If we fail to keep pace with technological advances or fail to offer compelling product offerings and state-of-the-art delivery platforms to meet consumer demands, our ability to grow or maintain the reach of our services, attract and retain users, and attract listeners and subscribers across our services will be adversely affected.
If we fail to keep pace with technological advances or fail to offer compelling product offerings and state-of-the-art delivery platforms to meet consumer demands, our ability to maintain the reach of our services and attract and retain users and subscribers across our services will be adversely affected.
In addition, our competitors’ streaming products may be pre-loaded or integrated into consumer electronics products or automobiles more broadly than our streaming products, creating a visibility advantage. If we are unable to compete successfully for listeners against other media providers, then our business may suffer.
In addition, our competitors’ streaming products may be pre-loaded or integrated into consumer electronics products or automobiles more broadly than our streaming products, creating a significant advantage. If we are unable to compete successfully for listeners against other media providers, then our business may suffer.
The outcome of these proceedings may not be favorable, and one or more unfavorable outcomes could have an adverse impact on our financial condition. See "Item 3. Legal Proceedings" of this Annual Report on Form 10-K for information on our material legal proceedings. We may be exposed to liabilities that other entertainment service providers would not customarily be subject to.
The outcome of these proceedings may not be favorable, and one or more unfavorable outcomes could have an adverse impact on our financial condition. See “Item 3. Legal Proceedings” of this Annual Report on Form 10-K for information on our material legal proceedings. We may be exposed to liabilities that other entertainment service providers would not customarily be subject to.
Our services, which are supported by our own systems and those of third-party vendors, could be subject to computer malware and attacks as well as to catastrophic events (such as fires, floods, hurricanes, or tornadoes), any of which could lead to system interruptions, delays, or shutdowns, causing loss of critical data or the unauthorized access to personally identifiable information.
Our services, which 30 Table of Contents are supported by our own systems and those of third-party vendors, could be subject to computer malware and attacks as well as to catastrophic events (such as fires, floods, hurricanes, or tornadoes), any of which could lead to system interruptions, delays, or shutdowns, causing loss of critical data or the unauthorized access to personally identifiable information.
The cyber security measures we have implemented, however, may not be sufficient to prevent all possible attacks and may be vulnerable to hacking, employee error, ransom attacks, malfeasance, system error, faulty password management or other irregularities.
The cyber security measures we have implemented, however, may not be sufficient to prevent all possible attacks and may be vulnerable to hacking, employee error, ransom attacks, malfeasance, system error, faulty password management, social engineering or other irregularities.
The nature of our business involves the receipt and storage of personal information about our subscribers and listeners including credit and debit card information. We have a program in place to detect and respond to data security incidents.
The nature of our business involves the receipt and storage of personal information about our subscribers and listeners including, in some cases, credit and debit card information. We have a program in place to detect and respond to data security incidents.
Advertisers may leave us for competing alternatives at any time. Failure to demonstrate to advertisers the value of our Pandora service would result in reduced spending by, or loss of, advertisers, which would harm our revenue and business. If we are unable to maintain revenue growth from our advertising products our results of operations will be adversely affected.
Advertisers may leave us for competing alternatives at any time. Failure to demonstrate to advertisers the value of our Pandora service would result in reduced spending by, or loss of, advertisers, which would harm our revenue and business. If we are unable to maintain our advertising revenue our results of operations will be adversely affected.
Some of our marketing efforts may also attract more price sensitive subscribers, and our efforts to increase the penetration of satellite radios in new, lower-priced vehicle lines may result in the growth of more economy-minded subscribers. Each of these factors may harm our revenue or require additional spending on marketing efforts to demonstrate the value of our Sirius XM service.
Some of our marketing efforts may also attract more price sensitive subscribers, and our efforts to increase the penetration of satellite radios in new, lower-priced vehicle lines may result in the growth of more economy-minded subscribers. Each of these factors may harm our revenue or require additional spending on marketing efforts to demonstrate the value of our SiriusXM service.
Under the terms of the Copyright Royalty Board’s existing decision governing 28 Table of Contents sound recording royalties for satellite radio, we are required to pay a royalty based on our gross revenues associated with our satellite radio service, subject to certain exclusions, of 15.5% per year through December 31, 2027.
Under the terms of the Copyright Royalty Board’s existing decision governing sound recording royalties for satellite radio, we are required to pay a royalty based on our gross revenues associated with our satellite radio service, subject to certain exclusions, of 15.5% per year through December 31, 2027.
In addition, our subscribers and listeners, as well as potential customers, could lose confidence in our ability to protect their personal information, which could cause them to discontinue the use of our services.
In addition, our subscribers and listeners, as well as potential customers, could lose confidence in our ability to protect their personal information, which could cause them to discontinue or forego the use of our services.
We rely on our own systems and systems of third party vendors to enable subscribers and listeners to access our Pandora and Sirius XM services in a dependable and efficient manner. Any degradation in the quality, or any failure, of our systems could reduce our revenues, cause us to lose customers and damage our brands.
We rely on our own systems and systems of third party vendors to enable subscribers and listeners to access our Pandora and SiriusXM services in a dependable and efficient manner. Any degradation in the quality, or any failure, of our systems could reduce our revenues, cause us to lose customers and damage our brands.
Under the United States Copyright Act, we also must pay royalties to copyright owners of sound recordings for the performance of such sound recordings on our Sirius XM service. Those royalty rates may be established through negotiation or, if negotiation is unsuccessful, by the Copyright Royalty Board.
Under the United States Copyright Act, we also must pay royalties to copyright owners of sound recordings for the performance of such sound recordings on our SiriusXM service. Those royalty rates may be established through negotiation or, if negotiation is unsuccessful, by the Copyright Royalty Board.
Although we have implemented practices designed to maintain the availability of the information technology and service delivery systems we rely on and mitigate the harm of any unplanned interruptions, we cannot anticipate all eventualities. We occasionally experience unplanned outages or technical difficulties.
Although we have implemented practices designed to maintain the availability of the information technology and service delivery systems we rely on and mitigate the harm of any unplanned interruptions, we cannot anticipate all eventualities. We occasionally experience unplanned outages or 31 Table of Contents technical difficulties.
Any failure, or perceived failure, to further our initiatives, adhere to public statements, comply with 26 Table of Contents federal or state ESG laws and regulations, or meet evolving and varied stakeholder expectations and standards could result in legal and regulatory proceedings against us and adversely affect our business, reputation, financial condition, and operations results.
Any failure, or perceived failure, to further our initiatives, adhere to public statements, comply with federal or state ESG laws and regulations, or meet evolving and varied stakeholder expectations and standards could result in legal and regulatory proceedings against us and adversely affect our business, reputation, financial condition, and operations results.
Our business depends, in part, on various third parties, including: • creators and licensors of software that support our apps and services; • programming providers, including agreements with owners of various copyrights in music, and on-air talent; • manufacturers that build and distribute satellite radios; • companies that manufacture and sell integrated circuits for satellite radios; • vendors that operate our call centers; • vendors that have designed or built, and vendors that support or operate, other important elements of our systems, including our satellites and the cloud-based systems we use; • Apple, who distributes our apps through its App Store and who we rely on to collect fees and approve the terms of our consumer offers; and • Google, who distributes our apps through its App Store and who we rely on to collect fees and approve the terms of our consumer offers, and who plays an important role in the fulfillment of the ads we sell on our Pandora platform.
Our business depends, in part, on various third parties, including: • creators and licensors of software that support our apps and services; 23 Table of Contents • programming providers, including agreements with owners of various copyrights in music, and on-air talent; • manufacturers that build and distribute satellite radios; • vendors that have designed or built, and vendors that support or operate, other important elements of our systems, including our satellites, marketing platforms, billing and payment processing, and the cloud-based systems we use; • companies that manufacture and sell integrated circuits for satellite radios; • vendors that operate our call centers; • Apple, who distributes our apps through its App Store and who we rely on to collect fees and approve the terms of our consumer offers; and • Google, who distributes our apps through its App Store and who we rely on to collect fees and approve the terms of our consumer offers, and who plays an important role in the fulfillment of the ads we sell on our Pandora platform.
The lives of the satellites required to operate our Sirius XM service vary depending on a number of factors, including: • degradation and durability of solar panels; • quality of construction; • random failure of satellite components, which could result in significant damage to or loss of a satellite; • amount of fuel the satellite consumes; • the performance of third parties that manage the operation of our satellites; and • damage or destruction as a result of electrostatic storms, terrorist attacks, collisions with other objects in space or other events, such as nuclear detonations, occurring in space.
The lives of the satellites required to operate our SiriusXM service vary depending on a number of factors, including: 26 Table of Contents • degradation and durability of solar panels; • quality of construction; • random failure of satellite components, which could result in significant damage to or loss of a satellite; • amount of fuel the satellite consumes; • the performance of third parties that manage the operation of our satellites; and • damage or destruction as a result of electrostatic storms, terrorist attacks, collisions with other objects in space or other events, such as nuclear detonations, occurring in space.
Our competitors or other third parties may incorporate 27 Table of Contents AI into their products more quickly or more successfully than us, which could impair our ability to compete effectively and adversely affect our results of operations.
Our competitors or other third parties may incorporate AI into their products and operations more quickly or more successfully than us, which could impair our ability to compete effectively and adversely affect our results of operations.
Our ability to increase the number of subscribers and listeners to our services, retain our subscribers and listeners or convert listeners into subscribers, is uncertain and subject to many factors, including: • the price of our services; • the ease of use of our services; • the effectiveness of our marketing programs; 19 Table of Contents • with respect to our Sirius XM service, the sale or lease rate of new vehicles in the United States; • the rate at which our self-pay subscribers to our Sirius XM service buy and sell new and used vehicles in the United States; • our ability to convince owners and lessees of new and used vehicles that include satellite radios to purchase subscriptions to our Sirius XM service; • the perceived value of our programming and the packages and services we offer; • our ability to introduce features in a manner that is favorably received by consumers; • our ability to keep up with rapidly evolving technology and features in audio entertainment; • our ability to respond to evolving consumer tastes; and • actions by our competitors, such as Spotify, Apple, Google, Amazon and other audio entertainment and information providers.
Our ability to increase the number of subscribers and listeners to our services, retain our subscribers and listeners and convert listeners into subscribers, is uncertain and subject to many factors, including: • the price of our services; • the ease of use of our services; • the effectiveness of our marketing programs; • with respect to our SiriusXM service, the sale or lease rate of new vehicles in the United States; • the rate at which self-pay subscribers to our SiriusXM service buy and sell new and pre-owned vehicles in the United States; • our ability to convince owners and lessees of new and used vehicles that include satellite radios to purchase subscriptions to our SiriusXM service; • the perceived value of our programming and the packages and services we offer; • our ability to introduce features in a manner that is favorably received by consumers; • our ability to keep up with rapidly evolving technology and features in audio entertainment; • our ability to respond to evolving consumer tastes; and • actions by our competitors, such as Spotify, Apple, Google, Amazon, YouTube and other audio entertainment and information providers.
Our indebtedness increases our vulnerability to general adverse economic and industry conditions; requires us to dedicate a portion of our cash flow from operations to payments on indebtedness, reducing the availability of cash flow to fund capital expenditures, marketing and other general corporate activities; limits our ability to borrow additional funds; and may limit our flexibility in planning for, or reacting to, changes in our business and the audio entertainment industry.
Our indebtedness and the indebtedness of our subsidiaries: • increases our vulnerability to general adverse economic and industry conditions; • requires us and our subsidiaries to dedicate a portion of our and/or their cash flow from operations to payments on indebtedness, reducing the availability of cash flow to fund capital expenditures, marketing and other general corporate activities; • limits our and our subsidiaries’ abilities to borrow additional funds; and • may limit our and our subsidiaries’ flexibility in planning for, or reacting to, changes in our business and the audio entertainment industry.
Our subscribers and listeners can obtain similar content for free through terrestrial radio stations, Spotify, YouTube and other internet services.
Our subscribers and listeners can obtain similar content for free through Spotify, YouTube and other internet services as well as terrestrial radio stations.
Any material failure of our operating satellites could cause us to lose customers for our Sirius XM service and could materially harm our reputation and our operating results. We do not have insurance for our in-orbit satellites. Additional information regarding our fleet of satellites is contained in the section entitled “Item 1.
Any material failure of our operating satellites could cause us to lose customers for our SiriusXM service and could materially harm our reputation and our operating results. We do not have insurance for many of our in-orbit satellites. Additional information regarding our fleet of satellites is contained in the section entitled “Item 1.
We collect and use demographic, service usage, purchase history and other information, including location information, from and about our listeners through the internet. Further, we and third parties use tracking technologies, including “cookies” and related technologies, to help us manage and track our listeners’ interactions with our services and deliver relevant advertising.
We collect and use demographic, service usage, purchase history and other information from and about our listeners through interactions with our products and services and content over the internet. Further, we and third parties use tracking technologies, including “cookies” and related technologies, to help us manage and track our listeners’ interactions with our services and deliver relevant advertising.
The number of subscribers to our Sirius XM service declined in 2023 and may further contract in the future. If we are unable to retain current subscribers at expected rates, or the costs of retaining subscribers are higher than expected, our financial performance and operating results could be adversely affected.
The number of subscribers to our SiriusXM service declined in 2023 and 2024 and may further contract in the future. If we are unable to retain current subscribers at expected rates, or the costs of retaining subscribers are higher than expected, our financial performance and operating results could be adversely affected.
Any such litigation could be costly, divert our efforts from our business, subject us to significant liabilities to third parties, require us to seek licenses from third parties, block our ability to 29 Table of Contents operate our services or license our technology, or otherwise adversely affect our ability to successfully develop and market our services.
Any such litigation could be costly, divert our efforts from our business, subject us to significant liabilities to third parties, require us to seek licenses from third parties, block our ability to operate our services or license our technology, or otherwise adversely affect our ability to successfully develop and market our services.
The nature of our business requires us to expend significant resources to try to ensure that our marketing activities comply with consumer protection laws, including laws relating to telemarketing activities and privacy. These efforts may not be successful, and we may have to expend even greater resources in our compliance efforts.
The nature of our business requires us to expend significant resources to try to ensure that our marketing activities comply with consumer protection laws. These efforts may not be successful, and we may have to expend even greater resources in our compliance efforts.
Business - Satellites, Terrestrial Repeaters and Other Satellite Facilities” of this Annual Report on Form 10-K. Our Sirius XM service may experience harmful interference from wireless operations.
Business - Satellites, Terrestrial Repeaters and Other Satellite Facilities” of this Annual Report on Form 10-K. Our SiriusXM service may experience harmful interference from wireless operations.
Our Pandora and Off-platform business generates a significant portion of its revenues from advertising, and reduced spending by advertisers could harm our business. Our Pandora and Off-platform business currently generates a majority of its revenues from third parties advertising on the Pandora ad-supported service and other platforms.
Risks Relating to our Pandora and Off-platform Business Our Pandora and Off-platform business generates a significant portion of its revenues from advertising, and reduced spending by advertisers could harm our business. Our Pandora and Off-platform business generates a majority of its revenues from third parties advertising on the Pandora ad-supported service and other platforms.
The fracturing of the traditional system for licensing rights in musical works may have significant consequences to our business, including increasing licensing costs and reducing the availability of certain pieces for use on our services.
These traditional arrangements are changing. The fracturing of the traditional system for licensing rights in musical works may have significant consequences to our business, including increasing licensing costs and reducing the availability of certain pieces for use on our services.
Risks Relating to our Sirius XM Business A substantial number of our Sirius XM service subscribers periodically cancel their subscriptions and we cannot predict how successful we will be at retaining customers. As part of our business, we experience, and expect to experience in the future, subscriber turnover (i.e., churn).
A substantial number of our SiriusXM service subscribers periodically cancel their subscriptions, and we cannot predict how successful we will be at retaining customers. As part of our business, we experience, and expect to experience in the future, subscriber turnover (i.e., churn).
Damage to our satellite uplink facilities could result in a complete loss of our Sirius XM satellite service until we could transfer operations to suitable back-up facilities. The unfavorable outcome of pending or future litigation could have an adverse impact on our operations and financial condition.
Damage to our satellite uplink facilities could result in a complete loss of our satellite radio service until we could transfer operations to suitable back-up facilities. The unfavorable outcome of pending or future litigation and mass arbitrations could have an adverse impact on our operations and financial condition.
The contraction of our ad-supported listener base also decreases the size of demographic groups targeted by advertisers, which may hurt our ability to deliver advertising in a manner that maximizes advertisers’ return on investment and compete with other streaming advertising platforms.
The contraction of our ad-supported listener base also decreases the size of demographic groups targeted by advertisers, which hurts our ability to deliver advertising in a manner that maximizes advertisers’ return on investment and compete with other larger advertising platforms.
In order to effectively monetize listener hours, we must, among other things, penetrate local advertising markets and develop compelling ad product solutions. The substantial majority of the total listening to our Pandora service occurs on mobile devices.
In order to effectively monetize listener hours, we must, among other things, develop compelling ad product solutions. The substantial majority of the total listening to our Pandora service occurs on mobile devices.
We cannot predict how successful we will be at retaining customers who purchase or lease vehicles that include a subscription to our Sirius XM service. A substantial percentage of our Sirius XM subscribers are on promotional pricing plans and our ability to retain these subscribers or migrate them to higher priced plans is uncertain.
We cannot predict how successful we will be at retaining customers who purchase or lease vehicles that include a subscription to our SiriusXM service. A substantial percentage of our SiriusXM subscribers are on promotional pricing plans and our ability to retain these subscribers is uncertain.
Rapid technological and industry changes and new entrants could adversely impact our services. The audio entertainment industry is characterized by rapid technological change, frequent product and feature innovations, changes in customer requirements and expectations, evolving standards and new entrants offering products and services. If we are unable to keep pace with these changes, our business may not succeed.
The audio entertainment industry is characterized by rapid technological change, frequent product and feature innovations, changes in customer requirements and expectations, evolving standards and new entrants offering products and services. If we are unable to keep pace with these changes, our business may not succeed. Products using new technologies could make our services less competitive in the marketplace.
Our third party licensors may not continue to make their software available to us on acceptable terms, invest the appropriate levels of resources in their software to maintain and enhance its capabilities, or remain in business.
Our third party licensors may not continue to make their software available to us on acceptable terms, invest the appropriate levels of resources in their software to maintain and enhance its capabilities, or remain in business. Failure of these third party licensors could harm our streaming services.
Risks Relating to Laws and Governmental Regulations Privacy and data security laws and regulations may hinder our ability to market our services, sell advertising and impose legal liabilities. We receive a substantial amount of personal data on purchasers and lessees of new and used vehicles from third parties. We use this personal data to market our services.
Risks Relating to Laws and Governmental Regulations Privacy and data security laws and regulations may hinder our ability to market our services, sell advertising and impose legal liabilities. We receive a substantial amount of personal data from third parties on purchasers and lessees of new and pre-owned vehicles and from and about listeners to our services.
We must maintain music programming royalty arrangements with, and pay license fees to, owners of rights in musical works in order to operate our services. Traditionally, BMI, ASCAP, SESAC and GMR have negotiated for these copyright users, collected royalties and distributed them to songwriters and music publishers. These traditional arrangements are changing.
The market for music rights is changing and is subject to significant uncertainties. We must maintain music programming royalty arrangements with, and pay license fees to, owners of rights in musical works in order to operate our services. Traditionally, BMI, ASCAP, SESAC and GMR have negotiated for these copyright users, collected royalties and distributed them to songwriters and music publishers.
We employ a wide variety of communications tools as part of our marketing campaigns, including telemarketing efforts and email solicitations. The effectiveness of our marketing efforts is affected by a broad range of factors, including creative and execution factors.
We employ a wide variety of communications tools as part of our marketing campaigns, including telemarketing efforts, email solicitations and targeted and personalized digital outreach. The effectiveness of our marketing efforts is affected by a broad range of factors, including creative and execution factors and effective targeting.
Our ability to maintain and enhance our brands also depends in part on our ability to continue to develop and provide an innovative and high-quality entertainment experience, which we may not do successfully.
Our ability to maintain and enhance our brands also depends in part on our ability to continue to develop and provide an innovative and high-quality entertainment experience, which we may not do successfully. ITEM 1B. UNRESOLVED STAFF COMMENTS None.
Our success depends to a significant extent on discretionary consumer spending. Some of the factors that may influence consumer spending on entertainment include general economic conditions, the availability of discretionary income, consumer confidence, interest rates, inflationary pressure, and general uncertainty regarding the overall economic environment.
The impact of economic conditions may adversely affect our business, operating results, and financial condition. Our success depends to a significant extent on discretionary consumer spending. Some of the factors that may influence consumer spending on entertainment include general economic conditions, the availability of discretionary income, inflationary pressure, consumer confidence, interest rates, and general uncertainty regarding the overall economic environment.
As is common in the audio entertainment industry, these advertisers do not have long-term advertising commitments with us and can terminate their contracts at any time. Expenditures by advertisers tend to be cyclical, reflecting overall economic conditions and budgeting and buying patterns.
These advertisers do not have long-term advertising commitments with us and can terminate their contracts at any time. Expenditures by advertisers tend to be cyclical, reflecting overall economic conditions and budgeting and buying patterns.
New laws, amendments to or re-interpretations of existing laws and contractual obligations, as well as changes in our listeners’ expectations and demands regarding privacy and data security, may limit our ability to collect and use consumer data.
We may not be in compliance with all of the new laws and regulations regarding privacy. New laws, amendments to or re-interpretations of existing laws and contractual obligations, as well as changes in our listeners’ expectations and demands regarding privacy and data security, may limit our ability to collect and use consumer data.
In addition, our borrowings under our Senior Secured Revolving Credit Facility carry a variable interest rate based on the Secured Overnight Financing Rate (“SOFR”). We may, in the future, hedge against interest rate fluctuations by using hedging instruments such as swaps, caps, options, forwards, futures or other similar products.
In addition, Sirius XM Radio’s borrowings under its Senior Secured Revolving Credit Facility, including the Incremental Term Loan, carry a variable interest rate based on the Secured Overnight Financing Rate (“SOFR”). Sirius XM Radio may, in the future, hedge against interest rate fluctuations by using hedging instruments such as swaps, caps, options, forwards, futures or other similar products.
We may not be able to capture an increasing share of local and audio advertising revenue, which may have an adverse impact on our future revenue. Changes to mobile operating systems and browsers may hinder our ability to sell advertising and market our services.
We do not currently have the ability to effectively capture a meaningful share of local audio advertising revenue, which may have an adverse impact on our future revenue. Changes to mobile operating systems and browsers may hinder our ability to sell advertising and market our services.
Consumers purchasing or leasing used vehicles may be more price sensitive than consumers purchasing or leasing new vehicles, convert from trial subscribers to self-paying subscribers at a lower rate, and cancel their subscriptions more frequently than consumers purchasing or leasing new vehicles.
Similarly, our efforts to acquire subscribers purchasing or leasing pre-owned vehicles may attract price sensitive consumers. Consumers purchasing or leasing pre-owned vehicles may be more price sensitive than consumers purchasing or leasing new vehicles, convert from trial subscribers to self-paying subscribers at a lower rate, or cancel their subscriptions more frequently than consumers purchasing or leasing new vehicles.
Increased regulation of personal data utilization practices and compliance administration could increase our costs of operation or otherwise adversely affect our business. Consumer protection laws and our failure to comply with them could damage our business.
Increased regulation of personal data utilization practices and compliance administration could increase our costs of operation or otherwise adversely affect our business. Consumer protection laws and our failure to comply with them could damage our business. Federal and state consumer protection laws, rules and regulations cover nearly all aspects of our marketing efforts.
These agreements grant us the right to operate Pandora Premium, and add interactive features, such as replays, additional skips and offline play, to Pandora’s ad-supported service and to Pandora Plus. The economic terms of these direct licenses are onerous and, as a result, we may not be able to profitably operate the Pandora services.
These agreements grant us the right to operate Pandora Premium, and add interactive features, such as replays, additional skips and offline play, to Pandora’s ad-supported service and to Pandora Plus. The economic terms of these direct licenses are onerous and grant the licensors broad rights over the Pandora services.
Any such cybersecurity incidents related to our use of AI applications could adversely affect our reputation and results of operations. AI also presents emerging ethical issues, such as the proper use of copyrighted material with AI applications, and if our use of AI becomes controversial, we may experience brand or reputational harm, competitive harm, or legal liability.
AI also presents emerging ethical issues, such as the proper use of copyrighted material with AI applications, and if our use of AI becomes controversial, we may experience brand or reputational harm, competitive harm, or legal liability.
ITEM 1A. RISK FACTORS In addition to the other information in this Annual Report on Form 10-K, including the information under the caption Item 1. Business “Competition,” the following risk factors should be considered carefully in evaluating us and our business.
ITEM 1A. RISK FACTORS In addition to the other information in this Annual Report on Form 10-K, including the information under the caption Item 1. Business “Competition,” the following risk factors should be considered carefully in evaluating us and our business. Risks Relating to our Business and Operations We face substantial competition and that competition has increased over time.
We incorporate artificial intelligence (“AI”) solutions into our digital infrastructure, services, offerings and features, and these applications may become important in our operations over time.
We incorporate various artificial intelligence (“AI”) solutions into our digital infrastructure, services, offerings and features, and these applications are becoming important in our operations.
Modifications to consumer protection laws, including laws regarding the pricing of our services and the manner in which consumers can cancel our services as well as decisions by courts and administrative agencies interpreting these laws, could have an adverse impact on our ability to attract and retain subscribers and listeners to our services.
In addition, other governmental authorities have commenced investigations into our consumer practices, including the manner in which we allow consumers to cancel subscriptions to our services. 29 Table of Contents Modifications to consumer protection laws, including laws regarding the manner in which consumers can cancel our services as well as decisions by courts and administrative agencies interpreting these laws, could have an adverse impact on our ability to attract and retain subscribers and listeners to our services.
In addition, we have entered into agreements for the construction and launch of four new satellites that are expected to be launched over the next four years, and material delays in the deployment of these satellites could be harmful to our business. Our Sirius network of terrestrial repeaters communicates with a single third party satellite.
In addition, we have entered into agreements for the construction and launch of three new satellites that are expected to be launched over the next three years, and material delays in the deployment of these satellites could be harmful to our business.
The decline in our listener base has resulted in fewer listener hours and available advertising spots on our Pandora service, which ultimately may result in declines in our advertising revenue, and adversely affect our Pandora and Off-platform business.
The decline in our listener base, including the shift of listening in connected homes and vehicles, has resulted in fewer listener hours and fewer available advertising spots on our Pandora service, which may contribute to declines in our advertising revenue and adversely affect our Pandora and Off-platform business.
Such third parties may not be able to perform their obligations to us in a timely manner, if at all, as a result of their financial condition or may be relieved of their obligations to us as part of seeking bankruptcy protection. We are migrating our billing system and payment processing functions to a new service provider.
Such third parties may not be able to perform their obligations to us in a timely manner, if at all, as a result of their financial condition or may be relieved of their obligations to us as part of seeking bankruptcy protection.
Additionally, if the content, analyses, search results or recommendations that AI applications assist in producing are, or are alleged to be, deficient, inaccurate, or biased, our business, reputation, financial condition, and results of operations could be adversely affected. The use of AI applications may result in cybersecurity incidents that implicate the personal data of consumers.
Additionally, if the content, analyses, search results or recommendations that AI applications assist in producing are, or are alleged to be, deficient, inaccurate, biased or in violation of third parties’ intellectual property rights, our business, reputation, financial condition, and results of operations could be adversely affected.
In the event that portions of our proprietary technology are determined to be subject to an open source license, we may be required to publicly release portions of our source code, be forced to re-engineer all or a portion of our technologies, or otherwise be limited in the licensing of our technologies, each of which could adversely affect our ability to sustain and grow our business.
In the event that portions of our proprietary technology are determined to be subject to an open source license, we may be required to publicly release portions of our source code, be forced to re-engineer all or a portion of our technologies, or otherwise be limited in the licensing of our technologies, each of which could adversely affect our ability to sustain and grow our business. 33 Table of Contents Risks Related to our Capital Structure While we currently pay a quarterly cash dividend to holders of our common stock, we may change our dividend policy at any time.
Failure of these third party licensors could harm our streaming services. 20 Table of Contents In addition, a number of third parties on which we depend have experienced, and may in the future experience, financial difficulties or file for bankruptcy protection.
In addition, a number of third parties on which we depend have experienced, and may in the future experience, financial difficulties or file for bankruptcy protection.
Our promotional pricing strategy is widely known, and this may interfere with our ability to collect our ordinary subscription prices. In addition, a substantial number of those subscribers periodically cancel their subscriptions when offered a subscription at a higher price. Our ability to profitably attract and retain subscribers to our Sirius XM service is uncertain.
In addition, a substantial number of those subscribers periodically cancel their subscriptions when offered a subscription at a higher price. Our ability to profitably attract and retain new subscribers to our SiriusXM service is uncertain. A number of factors may affect our ability to attract and retain subscribers to our Sirius XM service.
Sales of used vehicles represent a significant source of new subscribers for our satellite radio service. We have agreements with auto dealers and companies operating in the used vehicle market to provide us with data on sales of used satellite radio enabled vehicles, including in many cases the consumer’s name and address.
We have agreements with auto dealers, companies operating in the pre-owned vehicle market and other third parties to provide us with data on sales of pre-owned satellite radio enabled vehicles, including in many cases the consumer’s name and address.
Natural disasters and extreme weather conditions can be caused or exacerbated by climate change. Any damage to the satellites that transmit to our terrestrial repeater networks would likely result in degradation of the affected service for some Sirius XM subscribers and could result in complete loss of Sirius XM satellite service in certain or all areas.
Any damage to the satellites that transmit to our terrestrial repeater networks would likely result in degradation of the affected service for some SiriusXM subscribers and could result in complete loss of satellite radio service in certain or all areas.
A number of factors may affect our ability to attract and retain subscribers to our Sirius XM service. The changing demographics of trialers to our service, such as the increase in “Millennial generation customers,” may increase the number of subscribers accustomed to consuming entertainment through ad-supported products.
The changing demographics of trialers to our service, such as the increase in “Millennial generation customers,” may increase the number of subscribers accustomed to consuming entertainment through ad-supported products. These changing demographics have affected and may continue to affect our ability to convert trial subscribers into self-paying subscribers.
Alleged violations of laws and regulations relating to privacy and personal data may expose us to potential liability, may require us to expend significant resources in responding to and defending such allegations and claims and could in the future result in negative publicity and a loss of confidence in us by our subscribers, listeners, advertisers and other third parties with whom we do business. 25 Table of Contents Privacy-related laws and regulations, such as the California Consumer Privacy Act and the European General Data Protection Regulation, are evolving and subject to potentially differing interpretations.
Alleged violations of laws and regulations relating to privacy and personal data may expose us to potential liability, may require us to expend significant resources in responding to and defending such allegations and claims and could in the future result in negative publicity and a loss of confidence in us by our subscribers, listeners, advertisers and other third parties.
There is no guarantee that Congress will not modify the statutory framework governing our services, or that the FCC will not modify its rules and regulations in a manner that would have an adverse impact on our operations.
There is no guarantee that Congress will not modify the statutory framework governing our services, or that the FCC will not modify its rules and regulations in a manner that would have an adverse impact on our operations. We may face lawsuits, incur liability or suffer reputational harm as a result of content published or made available through our services.
We may not be in compliance with the terms of these licenses, which could result in the loss of some or all of these licenses and some or all of the rights they convey.
We have not been able to negotiate or obtain lower royalty rates under these direct licenses. These direct licenses are complex. We may not be in compliance with the terms of these licenses, which could result in the loss of some or all of these licenses and some or all of the rights they convey.
The success of any acquisition depends upon effective integration, cultural assimilation and management of acquired businesses and assets into our operations, which is subject to risks and uncertainties, including realizing the growth potential, the anticipated synergies and cost savings, the ability to retain and attract personnel, the diversion of management’s attention for other business concerns, and undisclosed or potential legal liabilities of the acquired business or assets.
The success of any acquisition depends upon effective integration, cultural assimilation and management of acquired businesses and assets into our operations, which is subject to risks and uncertainties, including realizing the growth potential, the anticipated synergies and cost savings, the ability to retain and attract personnel, the diversion of management’s attention for other business concerns, and undisclosed or potential legal liabilities of the acquired business or assets. 24 Table of Contents The integration process could distract our management, disrupt our ongoing business or result in inconsistencies in our services, standards, controls, procedures and policies, any of which could adversely affect our ability to maintain relationships with customers, vendors and employees or to achieve the anticipated benefits of any such transaction or acquisition.
We are engaged in efforts to continue to convince advertisers of the capabilities and value of mobile digital advertising and to direct an increasing portion of their advertising spend to our ad-supported Pandora service. 24 Table of Contents We are continuing to build our sales capability to penetrate local advertising markets, which places us in competition with terrestrial radio.
We are engaged in efforts to continue to convince advertisers of the capabilities and value of mobile digital advertising and to direct an increasing portion of their advertising spend to our ad-supported Pandora service.
The transactions described under the heading “Business - Liberty Media Split-Off Transaction” involve a transfer of our FCC licenses and must be approved by the FCC. The operation of our satellite radio systems is subject to significant regulation by the FCC under authority granted through the Communications Act of 1934 and related federal law.
The operation of our satellite radio systems is subject to significant regulation by the FCC under authority granted through the Communications Act of 1934 and related federal law.
These agreements generally provide us the right to distribute the content and act as the exclusive agent for the sale of advertising in the podcasts. Payment terms for certain podcast content typically requires more upfront cash payments, including minimum guarantees to the owner or creator of the podcast, than other content licenses or arrangements.
Payment terms for certain premium content typically requires more upfront cash payments, including minimum guarantees to the owner or creator of the podcast, than other content licenses or arrangements.
Adverse macroeconomic conditions have affected, and may continue to affect, the demand for audio advertising, resulting in fluctuations in the amounts advertisers spend on advertising, which could harm our financial condition and operating results. Our failure to convince advertisers of the benefits of our Pandora ad-supported service could harm our business.
Adverse macroeconomic conditions and new competitive product offerings have affected, and may continue to affect, the demand for audio advertising, resulting in fluctuations in the amounts advertisers spend on advertising, which could harm our financial condition and operating results. Emerging industry trends may adversely impact our ability to generate revenue from advertising.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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In addition, we have engaged: Novacoast, an international cybersecurity company specializing in IT services and software development, to augment our monitoring and detection efforts; Synopsys, Inc., a leader in electronic design automation, to perform our external penetration testing and vulnerability assessment; Recorded Future, one of the world’s largest intelligence companies, and Mandiant, a recognized leader in cyber defense, threat intelligence and incident response services, to provide threat intelligence and analysis services; and Mandiant to augment our incident response ability and provide forensic services.
In addition, we have engaged: Novacoast, an international cybersecurity company specializing in IT services and software development, to augment our monitoring and detection efforts; Synopsys, Inc., a leader in electronic design automation, to perform our external penetration testing and vulnerability assessment; Recorded Future, one of the world’s largest intelligence companies, and Mandiant, a recognized leader in cyber defense, threat intelligence and incident response services, to provide threat intelligence and analysis services and augment our incident response ability.
To date, risks from cybersecurity threats have not previously materially affected us, and we currently do not expect that the risks from cybersecurity threats are reasonably likely to materially affect us, including our business, strategy, results of operations or financial condition.
To date, risks from cybersecurity threats have not materially affected us, and we currently do not expect that the risks from cybersecurity threats are reasonably likely to materially affect us, including our business, strategy, results of operations or financial condition.
The Audit Committee receives regular reports from our Chief Product and Technology Officer, Chief Information Security Officer and the Chief Information Officer on, among other things, our cyber risks and threats, the status of projects to strengthen our information security systems, assessments of our security program, and our views of the emerging threat landscape.
The Audit Committee receives regular reports from our Chief Information Security Officer on, among other things, our cyber risks and threats, the status of projects to strengthen our information security systems, assessments of our security program, and our views of the emerging threat landscape.
That said, as discussed more fully under “Item 1A – Risk Factors”, the sophistication of cyber threats continues to increase, and the preventative actions we take to reduce the risk of cyber incidents and protect our systems and information may be insufficient.
As discussed more fully under “Item 1A – Risk Factors”, the sophistication of cyber threats continues to increase, and the preventative actions we take to reduce the risk of cyber incidents and protect our systems and information may be insufficient.
The Security Council has primary management oversight responsibility for assessing and managing information security, fraud, vendor, data protection and privacy, and cybersecurity risks. We have a security incident response framework in place.
The Security Council has primary management oversight responsibility for assessing and managing risks related to information security, fraud, vendor oversight, data protection and privacy, and cybersecurity. We have a security incident response framework in place.
We have developed a robust cyber crisis response plan which provides a documented framework for handling high severity security incidents and facilitates coordination across multiple parts of the company. Our incident response team constantly monitors threat intelligence feeds, handles vulnerability management and responds to incidents. In addition, we routinely perform simulations and drills at both a technical and management level.
We have developed a robust cyber crisis response plan which provides a documented framework for handling high severity security incidents and facilitates coordination across multiple parts of the company. Our incident response team constantly monitors threat intelligence feeds, handles vulnerability management and responds to incidents. In addition, we routinely perform simulations and drills at technical, management and executive levels.
ITEM 1C. CYBERSECURITY Risk Management and Strategy 32 Table of Contents As part of our enterprise risk assessment function, which is led by our Senior Vice President and head of Internal Audit, we have implemented processes to assess, identify and manage the material risks facing the company, including from cyber threats.
ITEM 1C. CYBERSECURITY Risk Management and Strategy As part of our enterprise risk assessment function, which is led by our Senior Vice President and head of Internal Audit, we have implemented processes to assess, identify and manage the material risks facing us, including from cyber threats. Our enterprise risk assessment function is part of our overall risk management processes.
In particular, our Chief Information Security Officer has over twenty years of professional experience in the information security area, including as a result of his service as the director of security, a security architect and a software security engineer at companies such as Squarespace, Verizon Media (Oath), Tumblr, Bridgewater Associates and EMC; our Chief Product and Technology Officer has twenty eight years of professional experience in the information security area; and our Chief Information Officer has twenty three years of professional experience in the information security area. 34 Table of Contents
Our Chief Information Security Officer has extensive experience in the information technology area, with over twenty years of professional experience in the information security area, including as a result of his service as the director of security, a security architect and a software security engineer at companies such as Squarespace, Verizon Media (Oath), Tumblr, Bridgewater Associates and EMC.
Our enterprise risk assessment function is part of our overall risk management processes. Our cybersecurity program is built upon internationally recognized frameworks, such as ISO 27001, and maps to standards published by The National Institute of Standards and Technology. We believe that our processes provide us with a comprehensive assessment of potential cyber threats.
Our cybersecurity program is built upon 38 Table of Contents internationally recognized frameworks, such as ISO 27001, and maps to standards published by The National Institute of Standards and Technology. We believe that our processes provide us with a reasonable and comprehensive assessment of potential cyber threats.
In addition, we validate compliance with our internal data security controls through the use of security monitoring utilities and internal and external audits. Our Chief Information Security Officer, Chief Product and Technology Officer and Chief Information Officer each have extensive experience in the information technology area.
In addition, we validate compliance with our internal data security controls through the use of security monitoring utilities and internal and external audits.
We also purchase insurance to protect us against the risk of cybersecurity breaches. Our Senior Vice President and Treasurer is responsible for our insurance programs and reviews on a regular basis our cyber insurance policies and assesses whether we have appropriate coverage.
Our Senior Vice President and Treasurer is responsible for our insurance programs and reviews on a regular basis our insurance policies and assesses whether we have appropriate coverage.
Furthermore, on an annual basis, the Board reviews and discusses our technology strategy with our Chief Product and Technology Officer and approves our technology strategic plan. Role of management 33 Table of Contents Our Chief Information Security Officer, together with our Chief Product and Technology Officer and Chief Information Officer, is responsible for the day-to-day management of our cybersecurity risks.
As a matter of process, the Audit Committee annually reviews, and recommends to the Board its approval of, our information security policy and information security program. Furthermore, on an annual basis, the Board reviews and discusses our technology strategy and strategic plan. Role of management Our Chief Information Security Officer is responsible for the day-to-day management of our cybersecurity risks.
We have established a Security Council, which includes our Chief Executive Officer, Chief Commercial Officer, Chief Product and Technology Officer, Chief Information Security Officer, Chief Information Officer, Chief Financial Officer, General Counsel and other senior officers, that meets on at least a quarterly basis to review cybersecurity and information security matters.
To ensure robust oversight, we have established a Security Council comprising senior leaders, including our Chief Executive Officer, Chief Operating Officer, Chief Information Security Officer, Chief Financial Officer, General Counsel and Chief Privacy Officer. The Security Counsel meets on at least a quarterly basis to review cybersecurity and information security 39 Table of Contents matters.
The Chair of the Audit Committee regularly reports to the Board on cybersecurity risks and other matters reviewed by the Committee. In addition, the Board receives separate presentations on cybersecurity risk from our Chief Product and Technology Officer.
The Chair of the Audit Committee reports to the Board on cybersecurity risks and other matters reviewed by the Committee. In addition, the Board receives separate presentations on cybersecurity risk. Furthermore, all Board members are invited to attend each Audit Committee meeting and have access to the materials for each Audit Committee meeting.
Removed
Furthermore, all Board members are invited to attend each Audit Committee meeting and have access to the materials for each Audit Committee meeting. As a matter of process, the Audit Committee annually reviews, and recommends to the Board its approval of, our information security policy and information security program.
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Our Chief Information Security Officer aims to ensure rigorous oversight and execution of our cybersecurity and information security strategy. 40 Table of Contents

Item 2. Properties

Properties — owned and leased real estate

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PROPERTIES Below is a list of the principal properties that we own or lease: Sirius XM Location Purpose Own/Lease New York, NY Corporate headquarters, office facilities and studio/production facilities Lease Washington, DC Office and studio/production facilities Own Miami Beach, FL Office and studio/production facilities Lease Los Angeles, CA Office and studio/production facilities Lease Nashville, TN Studio/production facilities Lease Lawrenceville, NJ Office and technical/engineering facilities Lease Deerfield Beach, FL Office and technical/engineering facilities Lease Farmington Hills, MI Office and technical/engineering facilities Lease Irving, TX Office and engineering facilities/call center Lease Vernon, NJ Technical/engineering facilities Own Ellenwood, GA Technical/engineering facilities Lease Fredericksburg, VA Warehouse and technical/engineering facilities Lease Ashburn, VA Data center Lease We also lease other small facilities that we use as offices for our advertising sales personnel, studios and warehouse and maintenance space.
PROPERTIES Below is a list of the principal properties that we own or lease: Sirius XM Location Purpose Own/Lease New York, NY Corporate headquarters, office facilities and studio/production facilities Lease Washington, DC Office and studio/production facilities Own Miami Beach, FL Office and studio/production facilities Lease Los Angeles, CA Office and studio/production facilities Lease Nashville, TN Office and studio/production facilities Lease Lawrenceville, NJ Office and technical/engineering facilities Lease Deerfield Beach, FL Office and technical/engineering facilities Lease Farmington Hills, MI Office and technical/engineering facilities Lease Irving, TX Office and engineering facilities Lease Vernon, NJ Technical/engineering facilities Own Ellenwood, GA Technical/engineering facilities Lease Dublin, Ireland Technical/engineering facilities Lease Fredericksburg, VA Warehouse and technical/engineering facilities Lease Ashburn, VA Data center Lease We also lease other small facilities that we use as offices for our advertising sales personnel, studios and warehouse and maintenance space.
These facilities are not material to our business or operations. ITEM 3. LEGAL PROCEEDINGS For a discussion of our “Legal Proceedings,” refer to Note 16 in the notes to our audited consolidated financial statements in this Annual Report on Form 10-K. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 35 Table of Contents PART II
These facilities are not material to our business or operations. ITEM 3. LEGAL PROCEEDINGS For a discussion of our “Legal Proceedings,” refer to Note 16 in the notes to our audited consolidated financial statements in this Annual Report on Form 10-K. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 41 Table of Contents PART II
Pandora and Off-platform Location Purpose Own/Lease Oakland, CA Office and technical/engineering facilities Lease New York, NY Office, sales and studio/production facilities Lease Atlanta, GA Office, sales and technical/engineering facilities Lease Santa Monica, CA Office and sales facilities Lease We also lease other small facilities that we use as offices for our sales and office personnel.
None of these individual locations are material to our business or operations. Pandora and Off-platform Location Purpose Own/Lease Oakland, CA Office and technical/engineering facilities Lease New York, NY Office, sales and studio/production facilities Lease Atlanta, GA Office, sales and technical/engineering facilities Lease We also lease other small facilities that we use as offices for our sales and office personnel.
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None of these individual locations are material to our business or operations.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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(2) The weighted-average exercise price of outstanding options, warrants and rights relates solely to stock options, which are the only currently outstanding exercisable security. 38 Table of Contents ITEM 6. [RESERVED]
(2) The weighted-average exercise price of outstanding options, warrants and rights relates solely to stock options, which are the only currently outstanding exercisable security. 44 Table of Contents ITEM 6. [RESERVED]
Plan Category (shares in millions) Number of Securities to be Issued upon Exercise of Outstanding Options, Warrants and Rights (1) Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights (2) Number of Securities Remaining Available for Future Issuance under Equity Compensation Plans Equity compensation plans approved by security holders 211 $ 5.60 106 Equity compensation plans not approved by security holders — — — Total 211 $ 5.60 106 __________ (1) In addition to shares issuable upon exercise of stock options, amount also includes approximately 89 shares underlying restricted stock units, including performance-based restricted stock units (“PRSUs”) and dividend equivalents thereon.
Plan Category (shares in millions) Number of Securities to be Issued upon Exercise of Outstanding Options, Warrants and Rights (1) Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights (2) Number of Securities Remaining Available for Future Issuance under Equity Compensation Plans Equity compensation plans approved by security holders 30 $ 49.69 — Equity compensation plans not approved by security holders — — — Total 30 $ 49.69 — __________ (1) In addition to shares issuable upon exercise of stock options, amount also includes approximately 12 shares underlying restricted stock units, including performance-based restricted stock units (“PRSUs”) and dividend equivalents thereon.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is traded on the NASDAQ Global Select Market under the symbol “SIRI.” On January 30, 2024, there were approximately 6,100 record holders of our common stock.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is traded on the NASDAQ Global Select Market under the symbol “SIRI.” On January 28, 2025, there were approximately 5,722 record holders of our common stock.
Shares of common stock may be purchased from time to time on the open market, pursuant to pre-set trading plans meeting the requirements of Rule 10b5-1 under the Exchange Act, in privately negotiated transactions, including transactions with Liberty Media and its affiliates, or otherwise.
Shares of common stock may be purchased from time to time on the open market, pursuant to pre-set trading plans meeting the requirements of Rule 10b5-1 under the Exchange Act, in privately negotiated transactions, including in accelerated stock repurchase transactions, or otherwise.
The graph assumes that $100 was invested on December 31, 2018 in each of our common stock, the S&P 500 and the S&P 500 Media & Entertainment Index . In November 2016, we paid our first quarterly dividend. Our board of directors expects to declare regular quarterly dividends.
The graph assumes that $100 was invested on December 31, 2019, in each of our common stock, the S&P 500, the S&P 500 Media & Entertainment Index and the S&P 1500 Media and Entertainment Index .
Stockholder Return Performance Table S&P 500 Index S&P 500 Media & Entertainment Index Sirius XM Holdings Inc.
Our board of directors expects to declare regular quarterly dividends. 43 Table of Contents Stockholder Return Performance Table S&P 1500 Media & Entertainment Index S&P 500 Index S&P 500 Media & Entertainment Index Sirius XM Holdings Inc.
There were no purchases of equity securities registered pursuant to Section 12 of the Exchange Act during the quarter ended December 31, 2023. 36 Table of Contents COMPARISON OF CUMULATIVE TOTAL RETURNS Set forth below is a graph comparing the cumulative performance of our common stock with the Standard & Poor's Composite-500 Stock Index, or the S&P 500, and the S&P 500 Media & Entertainment Index, the published industry index we use, from December 31, 2018 to December 31, 2023.
The size and timing of any purchases will be based on a number of factors, including price and business and market conditions. 42 Table of Contents COMPARISON OF CUMULATIVE TOTAL RETURNS Set forth below is a graph comparing the cumulative performance of our common stock with the Standard & Poor's Composite-500 Stock Index, or the S&P 500, and the S&P 500 Media & Entertainment Index, the published industry index we previously used for the purposes of the SEC rules, and the S&P 1500 Media & Entertainment Index, the new published industry index we have selected to use, from December 31, 2019 to December 31, 2024.
Issuer Purchases of Equity Securities As of December 31, 2023, our board of directors had authorized us to repurchase an aggregate of $18.0 billion of our common stock and have not establish an end date for this stock repurchase program.
On September 10, 2024, we announced that our board of directors had approved for repurchase an aggregate of $1.166 billion of our common stock. The board of directors did not establish an end date for this stock repurchase program.
December 31, 2018 $ 100.00 $ 100.00 $ 100.00 December 31, 2019 $ 128.88 $ 133.63 $ 126.36 December 31, 2020 $ 149.83 $ 175.28 $ 113.57 December 31, 2021 $ 190.13 $ 222.03 $ 114.34 December 31, 2022 $ 153.16 $ 124.20 $ 110.66 December 31, 2023 $ 190.27 $ 205.63 $ 106.01 37 Table of Contents Equity Compensation Plan Information The following table provides information about our common stock that may be issued upon exercise of options, warrants and rights under our equity compensation plans.
Equity Compensation Plan Information The following table provides information about our common stock that may be issued upon exercise of options, warrants and rights under our equity compensation plans. Information is as of December 31, 2024.
As of December 31, 2023, our cumulative repurchases since December 2012 under our stock repurchase program totaled 3.7 billion shares for approximately $16.8 billion, and approximately $1.2 billion remained available under our existing $18.0 billion stock repurchase program. The size and timing of our repurchases will be based on a number of factors, including price and business and market conditions.
As of the closing of the Transactions, Old Sirius' cumulative repurchases since December 2012 under that stock repurchase program totaled 373 million shares for $16.8 billion, and $1.166 billion remained available under that stock repurchase program. The stock repurchase program of Old Sirius was terminated on the closing date of the Transactions.
Added
Issuer Purchases of Equity Securities The following table provides information about our purchases of equity securities registered pursuant to Section 12 of the Exchange Act during the quarter ended December 31, 2024.
Added
Period Total Number of Shares Purchased Average Price Paid Per Share (a) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (a) October 1, 2024 - October 31, 2024 — $ — — $ 1,166,487,722 November 1, 2024 - November 30, 2024 — $ — — $ 1,166,487,722 December 1, 2024 - December 31, 2024 300,609 $ 22.71 300,609 $ 1,159,660,534 Total 300,609 $ 22.71 300,609 a) These amounts include fees and commissions associated with the shares repurchased.
Added
All of these repurchases were made pursuant to our share repurchase program. Prior to the closing of the Transactions, the board of directors of Old Sirius had approved the repurchase of an aggregate of $18.0 billion of its common stock.
Added
We intend to fund any stock repurchases through a combination of cash on hand, cash generated by operations and future borrowings.
Added
The information in the graph represents the performance of the common stock of Old Sirius for the period from December 31, 2019 to September 9, 2024, the closing of the Transactions, and the performance of our common stock from September 10, 2024 to December 31, 2024.
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We determined to change the published industry index used for the required performance graph to the S&P 1500 Media & Entertainment Index following a review by the Compensation Committee’s independent consultants, Meridian Compensation Partners, LLC, to identify the most-appropriate index for determining a part of our executive compensation awards.
Added
This review concluded that the S&P 1500 Media & Entertainment Index was more closely aligned with companies in our executive compensation peer group than the S&P 500 Media & Entertainment Index.
Added
From an investor perspective, the S&P 1500 Media & Entertainment Index also was found to consist of additional companies that more closely aligned as peers than those contained in the S&P 500 Media & Entertainment Index and other alternatives that were tested, supporting its relevance to investors for relative capital-market performance comparisons.
Added
December 31, 2019 $ 100.00 $ 100.00 $ 100.00 $ 100.00 December 31, 2020 $ 130.73 $ 116.26 $ 131.17 $ 89.89 December 31, 2021 $ 165.21 $ 147.52 $ 166.16 $ 90.55 December 31, 2022 $ 92.69 $ 118.84 $ 92.95 $ 87.64 December 31, 2023 $ 152.08 $ 147.64 $ 153.89 $ 83.90 December 31, 2024 $ 213.02 $ 182.05 $ 216.58 $ 36.14 This performance graph shall not be deemed “soliciting material” or “filed” with the SEC for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into any of our filings under the Securities Act or the Exchange Act.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

124 edited+52 added−35 removed45 unchanged
Our largest source of cash provided by operating activities is cash generated by subscription and subscription-related revenues. We also generate cash from the sale of advertising through our Pandora and Off-platform business, advertising on certain non-music channels on Sirius XM and the sale of satellite radios, components and accessories.
Our largest source of cash provided by operating activities is cash generated by subscription and subscription-related revenues. We also generate cash from the sale of advertising through the Pandora and Off-platform business, advertising on certain non-music channels on Sirius XM and the sale of satellite radios, components and accessories.
We believe that we have sufficient cash and cash equivalents, as well as debt capacity, to cover our estimated short-term and long-term funding needs, including amounts to construct, launch and insure replacement satellites, as well as fund future stock repurchases, future dividend payments and to pursue strategic opportunities.
We believe that we have sufficient cash and cash equivalents, as well as debt capacity, to cover our estimated short and long-term funding needs, including amounts to construct, launch and insure replacement satellites, as well as fund future stock repurchases and dividend payments and to pursue strategic opportunities.
We evaluate and update our assumptions and estimates on an ongoing basis and use outside experts to assist in that evaluation when we deem necessary. We have identified all significant accounting policies in Note 2 to our consolidated financial statements in Part II, Item 8, of this Annual Report on Form 10-K. Non-Financial Instrument Valuations.
We evaluate and update our assumptions and estimates on an ongoing basis and use outside experts to assist in that evaluation when we deem necessary. We have identified all significant accounting policies in Note 2 to our audited consolidated financial statements in Part II, Item 8, of this Annual Report on Form 10-K. Non-Financial Instrument Valuations.
In the event that actual income from operations differs from forecasted amounts, or if we change our estimates of forecasted income from operations, we could record additional charges or reduce allowances in order to adjust the carrying value of deferred tax assets to their realizable amount. Such adjustments could be material to our consolidated financial statements.
In the event that actual income from operations differs from forecasted amounts, or if we change our estimates of forecasted income from operations, we could record additional charges or reduce allowances in order to adjust the carrying value of deferred tax assets to their realizable amount. Such adjustments could be material to our audited consolidated financial statements.
Critical Accounting Policies and Estimates Our consolidated financial statements are prepared in accordance with GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the periods.
Critical Accounting Policies and Estimates Our audited consolidated financial statements are prepared in accordance with GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the periods.
SAC, Per Installation, is derived from subscriber acquisition costs less margins from the sale of radios, components and accessories (excluding connected vehicle services), divided by the number of satellite radio installations in new vehicles and shipments of aftermarket radios for the period.
SAC, Per Installation, is derived from subscriber acquisition costs and margins from the sale of radios, components and accessories (excluding connected vehicle services), divided by the number of satellite radio installations in new vehicles and shipments of aftermarket radios for the period.
Future Liquidity and Capital Resource Requirements Based upon our current business plans, we expect to fund operating expenses, capital expenditures, including the construction of replacement satellites, working capital requirements, interest payments, taxes and scheduled maturities of our debt with existing cash, cash flow from operations and borrowings under our Credit Facility.
Future Liquidity and Capital Resource Requirements Based upon our current business plans, we expect to fund operating expenses, capital expenditures, including the construction of replacement satellites, working capital requirements, interest payments, taxes and scheduled maturities of our debt with existing cash, cash flow from operations and borrowings under the Credit Facility, including the Incremental Term Loan.
RPM - is calculated by dividing advertising revenue, excluding AdsWizz and other off-platform revenue, by the number of thousands of listener hours on our Pandora advertising-based service. 57 Table of Contents
RPM - is calculated by dividing advertising revenue, excluding AdsWizz and other off-platform revenue, by the number of thousands of listener hours on our Pandora advertising-based service. 64 Table of Contents
Engineering, Design and Development consists primarily of compensation and related costs to develop chipsets and new products and services, including streaming and connected vehicle services, research and development for broadcast information systems and the design and development costs to incorporate Sirius XM radios into new vehicles manufactured by automakers.
Product and Technology consists primarily of compensation and related costs to develop chipsets and new products and services, including streaming and connected vehicle services, research and development for broadcast information systems and the design and development costs to incorporate Sirius XM radios into new vehicles manufactured by automakers.
If the carrying value of our long-lived assets exceeds their estimated fair value, we are required to write the carrying value down to fair value. Any such writedown is included in Impairment, restructuring and acquisition costs in our consolidated statement of operations. Judgment is required to estimate the fair value of our long-lived assets.
If the carrying value of our long-lived assets exceeds their estimated fair value, we are required to write the carrying value down to fair value. Any such writedown is included in Impairment, restructuring and other costs in our audited consolidated statement of operations. Judgment is required to estimate the fair value of our long-lived assets.
We operate two in-orbit Sirius satellites, FM-5 and FM-6, which launched in 2009 and 2013, respectively, and estimate they will operate effectively through the end of their depreciable lives in 2024 and 2028, respectively. We currently operate three in-orbit XM satellites, XM-3, XM-5 and SXM-8.
We operate two in-orbit Sirius satellites, FM-5 and FM-6, which launched in 2009 and 2013, respectively, and estimate they will operate effectively through the end of their depreciable lives in 2024 and 2028, respectively. We currently operate four in-orbit XM satellites, XM-3, XM-5, SXM-8 and SXM-9.
We also believe the exclusion of the legal settlements and reserves, impairment, restructuring and acquisition related costs, to the extent they occur during the period, is useful as they are significant expenses not incurred as part of our normal operations for the period. 54 Table of Contents Adjusted EBITDA has certain limitations in that it does not take into account the impact to our consolidated statements of comprehensive income of certain expenses, including share-based payment expense.
We also believe the exclusion of the legal settlements and reserves, impairment, restructuring and other costs, to the extent they occur during the period, is useful as they are significant expenses not incurred as part of our normal operations for the period. 61 Table of Contents Adjusted EBITDA has certain limitations in that it does not take into account the impact to our consolidated statements of comprehensive income of certain expenses, including share-based payment expense.
We may use quoted market prices, prices for similar assets, present value techniques and other valuation techniques to prepare these estimates. We may need to make estimates of future cash flows and discount rates as well as other assumptions in order to implement these valuation techniques.
We may use quoted market prices, prices for similar assets, present value techniques and other valuation techniques to prepare these estimates. We may need to make estimates of future cash flows and discount rates as well as other assumptions in order to implement these valuation 58 Table of Contents techniques.
These services are designed to enhance the safety, security and driving experience of consumers. We also offer a suite of data services that includes graphical weather and fuel prices, a traffic information service, and real-time weather services in boats and airplanes. Sirius XM also holds a 70% equity interest and 33% voting interest in Sirius XM Canada.
These services are designed to enhance the safety, security and driving experience of consumers. We also offers a suite of data services that includes graphical weather and fuel prices, a traffic information service, and real-time weather services in boats and airplanes. Sirius XM holds a 70% equity interest and 33% voting interest in Sirius XM Canada Holdings Inc.
Cash Flows Used in Investing Activities Cash flows used in investing activities in the year ended December 31, 2023 were primarily due to spending for capitalized software and hardware, the construction of satellites and acquisitions of tax-effective investments for total cash consideration of $39.
Cash flows used in investing activities in the year ended December 31, 2023 were primarily due to spending for capitalized software and hardware, the construction of satellites and acquisitions of tax-effective equity investments for total cash consideration of $50.
If the tax position is not more likely than not to be sustained, the gross amount of the unrecognized tax 53 Table of Contents position will not be recorded in the financial statements but will be shown in tabular format within the uncertain income tax positions.
If the tax position is not more likely than not to be sustained, the gross amount of the unrecognized tax position will not be recorded in the financial statements but will be shown in tabular format within the uncertain income tax positions.
As of December 31, 2023, we had a valuation allowance of $88 relating to deferred tax assets that are not more likely than not to be realized due to the timing of certain state net operating loss limitations and acquired net operating losses that were not likely to be utilized.
As of December 31, 2024, we had a valuation allowance of $93 relating to deferred tax assets that are not more likely than not to be realized due to the timing of certain state net operating loss limitations and acquired net operating losses that were not likely to be utilized.
During 2023, we recorded a charge of $34 primarily related to severance and other related costs, costs associated with the Transactions of $16, impairments primarily related to terminated software projects of $15, vacated office space impairments of $12, accrued expenses of $3 for which we will not recognize any future economic benefit, and a cost-method investment impairment of $2.
During the years ended December 31, 2023, we recorded a charge of $34 primarily related to severance and other related costs, costs associated with the Transactions of $26, impairments primarily related to terminated software projects of $15, vacated office space impairments of $12, accrued expenses of $3 for which we will not recognize any future economic benefit, and a cost-method investment impairment of $2.
Off-Balance Sheet Arrangements We do not have any significant off-balance sheet arrangements other than those disclosed in Note 16 to our consolidated financial statements in Part II, Item 8, of this Annual Report on Form 10-K that are reasonably likely to have a material effect on our financial condition, results of operations, liquidity, capital expenditures or capital resources.
Off-Balance Sheet Arrangements We do not have any significant off-balance sheet arrangements other than those disclosed in Note 16 to our audited consolidated financial statements included in this Annual Report on Form 10-K that are reasonably likely to have a material effect on our financial condition, results of operations, liquidity, capital expenditures or capital resources.
The Sirius XM service is distributed through our two proprietary satellite radio systems and streamed via applications for mobile devices, home devices and other consumer electronic equipment. Satellite radios are primarily distributed through automakers, retailers and our website.
The SiriusXM service is distributed through our two proprietary satellite radio systems and streamed via applications for mobile devices, home devices and other consumer electronic equipment. Satellite radios are primarily distributed through automakers, retailers and SiriusXM’s website.
Sirius XM Cost of Services Sirius XM Cost of Services includes revenue share and royalties, programming and content, customer service and billing and transmission expenses. Sirius XM Revenue Share and Royalties include royalties for transmitting content, including streaming royalties, as well as automaker, content provider and advertising revenue share.
Sirius XM Cost of Services Sirius XM Cost of Services includes revenue share and royalties, programming and content, customer service and billing, and transmission expenses. Sirius XM Revenue Share and Royalties include royalties for transmitting content, including streaming royalties, as well as revenue share agreements with automaker, content provider and advertisers.
In addition, through AdsWizz Inc., we provide a comprehensive digital audio and programmatic advertising technology platform, which connects audio publishers and advertisers with a variety of ad insertion, campaign trafficking, yield optimization, programmatic buying, marketplace and podcast monetization solutions.
In addition, through AdsWizz Inc., Sirius XM provides a comprehensive digital audio and programmatic advertising technology platform, which connects audio publishers and advertisers with a variety of ad insertion, campaign trafficking, yield optimization, programmatic buying, marketplace and podcast monetization solutions.
Average Self-pay Monthly Churn is derived by dividing the monthly average of self-pay deactivations for the period by the average number of self-pay subscribers for the period. (See accompanying Glossary for more details.) For the years ended December 31, 2023 and 2022, our average self-pay monthly churn rate was 1.6% and 1.5%, respectively.
Average Self-pay Monthly Churn is derived by dividing the monthly average of self-pay deactivations for the period by the average number of self-pay subscribers for the period. (See accompanying Glossary for more details.) For each of the years ended December 31, 2024 and 2023, our average self-pay monthly churn rate was 1.6%.
SAC, per installation, is calculated as follows: For the Years Ended December 31, 2023 2022 Subscriber acquisition costs, excluding connected vehicle services $ 359 $ 352 Less: margin from sales of radios and accessories, excluding connected vehicle services (179) (176) $ 180 $ 176 Installations (in thousands) 13,640 12,270 SAC, per installation (a) $ 13.18 $ 14.32 (a) Amounts may not recalculate due to rounding. 56 Table of Contents Ad supported listener hours - is based on the total bytes served over our Pandora advertising supported platforms for each track that is requested and served from our Pandora servers, as measured by our internal analytics systems, whether or not a listener listens to the entire track.
SAC, per installation, is calculated as follows: For the Years Ended December 31, 2024 2023 Subscriber acquisition costs, excluding connected vehicle services $ 369 $ 359 Less: margin from sales of radios and accessories, excluding connected vehicle services (172) (179) $ 197 $ 180 Installations (in thousands) 13,545 13,640 SAC, per installation (a) $ 14.55 $ 13.18 (a) Amounts may not recalculate due to rounding. 63 Table of Contents Ad supported listener hours - is based on the total bytes served over our Pandora advertising supported platforms for each track that is requested and served from our Pandora servers, as measured by our internal analytics systems, whether or not a listener listens to the entire track.
RPM is a key indicator of our ability to monetize advertising inventory created by our listener hours on the Pandora services. RPM is calculated by dividing advertising revenue by the number of thousands of listener hours to our Pandora advertising-based service. For the years ended December 31, 2023 and 2022, RPM was $99.39 and $101.19, respectively.
RPM is a key indicator of our ability to monetize advertising inventory created by listener hours on the Pandora services. Ad RPM is calculated by dividing advertising revenue by the number of thousands of listener hours of our Pandora advertising-based service. For the years ended December 31, 2024 and 2023, RPM was $100.59 and $99.39, respectively.
We have an arrangement with SoundCloud Holdings, LLC ("SoundCloud") to be its exclusive ad sales representative in the US and certain European countries and offer advertisers the ability to execute campaigns across the Pandora and SoundCloud platforms. We also have arrangements to serve as the ad sales representative for certain podcasts.
Sirius XM has an arrangement with SoundCloud Holdings, LLC ( “ SoundCloud ” ) to be its exclusive ad sales representative in the US and certain European countries and offer advertisers the ability to execute campaigns across the Pandora and SoundCloud platforms. It also has arrangements to serve as the ad sales representative for certain podcasts.
Our effective tax rate of 24.4% for the year ended December 31, 2022 was primarily impacted by federal and state income tax expense as well as changes in state valuation allowance, partially offset by a benefit related to research and development and certain other credits. 46 Table of Contents Key Financial and Operating Performance Metrics In this section, we present certain financial performance measures, some of which are presented as Non-GAAP items, which include free cash flow and adjusted EBITDA.
The effective tax rate for the year ended December 31, 2023 was primarily driven by federal and state income tax expense, partially offset by the benefits related to research and development and certain other credits, as well as a release in state valuation allowance. 52 Table of Contents Key Financial and Operating Performance Metrics In this section, we present certain financial performance measures, some of which are presented as Non-GAAP items, which include free cash flow and adjusted EBITDA.
Average self-pay monthly churn - for satellite-enabled subscriptions, the Sirius XM monthly average of self-pay deactivations for the period divided by the average number of self-pay subscribers for the period. Adjusted EBITDA - EBITDA is defined as net income before interest expense, income tax expense and depreciation and amortization.
Average self-pay monthly churn - for in-car and retail radio subscriptions, the Sirius XM monthly average of self-pay deactivations for the period divided by the average number of self-pay subscribers for the period. Adjusted EBITDA - EBITDA is defined as net (loss) income before interest expense, income tax expense and depreciation and amortization.
(See the accompanying Glossary for a reconciliation to GAAP and for more details.) For the years ended December 31, 2023 and 2022, adjusted EBITDA was $2,790 and $2,833, respectively, a decrease of 2%, or $43.
(See the accompanying Glossary for a reconciliation to GAAP and for more details.) For the years ended December 31, 2024 and 2023, adjusted EBITDA was $2,732 and $2,790, respectively, a decrease of 2%, or $58.
Adjusted EBITDA is a Non-GAAP financial measure that excludes or adjusts for the impact of other expense (income), loss on extinguishment of debt, impairment, restructuring and acquisition costs, costs associated with the Transactions, other non-cash charges such as share-based payment expense, and legal settlements and reserves (if applicable).
Adjusted EBITDA is a Non-GAAP financial measure that excludes or adjusts for the impact of other expense (income), gain on extinguishment of debt, impairment, restructuring and other costs, Former Parent operating costs, other non-cash charges such as share-based payment expense, and legal settlements and reserves (if applicable).
We spent $297 and $247 on capitalized software and hardware as well as $285 and $122 to construct satellites during the years ended December 31, 2023 and 2022, respectively. 50 Table of Contents Cash Flows Used in Financing Activities Cash flows used in financing activities consists of the issuance and repayment of long-term debt, the purchase of common stock under our share repurchase program, the payment of cash dividends and taxes paid in lieu of shares issued for stock-based compensation.
We spent $413 and $297 on capitalized software and hardware as well as $262 and $285 to construct satellites during the years ended December 31, 2024 and 2023, respectively. 56 Table of Contents Cash Flows Used in Financing Activities Cash flows used in financing activities consists of the issuance and repayment of long-term debt, purchases of our common stock, the payment of cash dividends and taxes paid in lieu of shares issued for stock-based compensation.
Our in-orbit satellites may experience component failures which could adversely affect their useful lives. We monitor the operating condition of our in-orbit satellites and if events or circumstances indicate that the depreciable lives of our in-orbit satellites have changed, we will modify the depreciable life accordingly. If we were to revise our estimates, our depreciation expense would change. Income Taxes.
We monitor the operating condition of our in-orbit satellites and if events or circumstances indicate that the depreciable lives of our in-orbit satellites have changed, we will modify the depreciable life accordingly. If we were to revise our estimates, our depreciation expense would change. Income Taxes.
We expect our Pandora and Off-platform programming and content costs to remain flat as lower personnel-related costs are offset by additional programming and live listener events and promotions. Pandora and Off-platform Customer Service and Billing includes transaction fees on subscription purchases through mobile app stores and bad debt expense.
We expect our Pandora and Off-platform programming and content costs to remain relatively flat as increased podcast and event production costs are offset by lower personnel-related expenses. Pandora and Off-platform Customer Service and Billing includes transaction fees on subscription purchases through mobile app stores and bad debt expense.
Adjusted EBITDA excludes or adjusts for the impact of other expense (income), loss on extinguishment of debt, impairment, restructuring and acquisition costs, costs associated with the Transactions, other non-cash charges such as share-based payment expense, and legal settlements and reserves (if applicable).
Adjusted EBITDA excludes the impact of other expense (income), loss on extinguishment of debt, impairment, restructuring and other costs, Former Parent operating costs, other non-cash charges such as share-based payment expense, and legal settlements and reserves (if applicable).
Cash flows used in investing activities in the year ended December 31, 2022 were primarily due to spending for capitalized software and hardware, to construct satellites, and acquisitions for total cash consideration of $136.
Cash Flows Used in Investing Activities Cash flows used in investing activities in the year ended December 31, 2024 were primarily due to spending for capitalized software and hardware, the construction of satellites and acquisitions of tax-effective investments for total cash consideration of $244.
On January 24, 2024, our board of directors declared a quarterly dividend on our common stock in the amount of $0.0266 per share of common stock payable on February 23, 2024 to stockholders of record as of the close of business on February 9, 2024.
Dividend On January 22, 2025, our board of directors declared a quarterly dividend on our common stock in the amount of $0.27 per share of common stock payable on February 25, 2025 to stockholders of record as of the close of business on February 7, 2025.
Net additions decreased as a result of decreases in trial starts and lower retention due to certain price increases. Ad supported listener hours are a key indicator of our Pandora business and the engagement of our Pandora listeners. We include ad supported listener hours related to Pandora's non-radio content offerings in the definition of listener hours.
The decrease in ending subscribers was driven by decreases in trial starts and lower retention due to price increases. Ad supported listener hours are a key indicator of our Pandora business and the engagement of our Pandora listeners. We include ad supported listener hours related to Pandora's non-music content offerings in the definition of listener hours.
Subscribers to Cloud Cover are not included in Pandora's subscriber count. 47 Table of Contents Set forth below are our subscriber balances as of December 31, 2023 compared to December 31, 2022.
Subscribers to the Cloud Cover music programming service are now included in Pandora's subscriber count. 53 Table of Contents Set forth below are our subscriber balances as of December 31, 2024 compared to December 31, 2023.
We expect our Sirius XM cost of equipment to decrease as aftermarket sales decline. 43 Table of Contents Pandora and Off-platform Cost of Services Pandora and Off-platform Cost of Services includes revenue share and royalties, programming and content, customer service and billing, and transmission expenses.
We expect our Sirius XM cost of equipment to remain relatively flat. Pandora and Off-platform Cost of Services Pandora and Off-platform Cost of Services includes revenue share and royalties, programming and content, customer service and billing, and transmission expenses.
Contractual Cash Commitments For a discussion of our “Contractual Cash Commitments,” refer to Note 16 to our consolidated financial statements in Part II, Item 8, of this Annual Report on Form 10-K.
Contractual Cash Commitments For a discussion of our “Contractual Cash Commitments,” refer to Note 16 to our audited consolidated financial statements included in this Annual Report on Form 10-K. Related Party Transactions For a discussion of “Related Party Transactions,” refer to Note 12 to our audited consolidated financial statements included in this Annual Report on Form 10-K.
The increase was driven by higher vehicle related churn, partially offset by lower non-pay churn. ARPU is derived from total earned subscriber revenue (excluding revenue derived from our connected vehicle services) and net advertising revenue, divided by the number of months in the period, divided by the daily weighted average number of subscribers for the period.
ARPU is derived from total earned Sirius XM subscriber revenue (excluding revenue derived from our connected vehicle services) and net advertising revenue, divided by the number of months in the period, divided by the daily weighted average number of subscribers for the period.
For the years ended December 31, 2023 and 2022, customer service and billing expenses were $393 and $415, respectively, a decrease of 5%, or $22, and decreased as a percentage of total Sirius XM revenue. The decrease was primarily driven by lower call center and personnel-related costs, partially offset by higher transaction costs.
For the years ended December 31, 2024 and 2023, customer service and billing expenses were $369 and $393, respectively, a decrease of 6%, or $24, and decreased as a percentage of total Sirius XM revenue. The reduction was primarily driven by lower call center costs, transaction and payment processing fees, bad debt expense, and personnel-related costs.
Other (Expense) Income primarily includes realized and unrealized gains and losses from our Deferred Compensation Plan and other investments, interest and dividend income, our share of the income or loss from equity investments in Sirius XM Canada and SoundCloud, and transaction costs related to non-operating investments.
Other Income (Expense), Net primarily includes realized and unrealized gains and losses from our debt measured at fair value, bond hedges, Deferred Compensation Plan and other investments, intergroup interests, interest and dividend income, our share of the income or loss from equity investments, and transaction costs related to non-operating investments.
We also derive revenue from advertising on select non-music channels, which is sold under the SiriusXM Media brand, direct sales of our satellite radios and accessories, and other ancillary services. As of December 31, 2023, our Sirius XM business had approximately 33.9 million subscribers. In addition to our audio entertainment businesses, we provide connected vehicle services to several automakers.
Additional revenue streams include advertising on select non-music channels, direct sales of radios and accessories, and other ancillary services. As of December 31, 2024, the SiriusXM business had approximately 33.2 million subscribers. In addition to the audio entertainment businesses, we provide connected vehicle services to several automakers.
Sirius XM Canada's subscribers are not included in our subscriber count or subscriber-based operating metrics. Pandora and Off-platform Our Pandora and Off-platform business operates a music, comedy and podcast streaming discovery platform, offering a personalized experience for each listener wherever and whenever they want to listen, whether through mobile devices, vehicle speakers or connected devices.
Pandora and Off-platform Our Pandora and Off-platform business operates a music, comedy and podcast streaming platform, offering a personalized experience for each listener wherever and whenever they want to listen, whether through mobile devices, car speakers or connected devices.
Operating Costs Subscriber Acquisition Costs are costs associated with our satellite radio service and include hardware subsidies paid to radio manufacturers, distributors and automakers; subsidies paid for chipsets and certain other components used in manufacturing radios; device royalties for certain radios and chipsets; product warranty obligations; and freight.
These include hardware subsidies paid to radio manufacturers, distributors and automakers; subsidies paid for chipsets and certain other components used in manufacturing radios; device royalties for certain radios and chipsets; product warranty obligations; and freight. The majority of subscriber acquisition costs are incurred and expensed in advance of acquiring a subscriber.
We expect our Sirius XM transmission expenses to increase as costs associated with consumers using our 360L platform rise and investments in streaming grow. Sirius XM Cost of Equipment includes costs from the sale of satellite radios, components and accessories and provisions for inventory allowance attributable to products purchased for resale in our direct to consumer distribution channels.
Sirius XM Cost of Equipment includes costs from the sale of satellite radios, components and accessories and provisions for inventory allowance attributable to products purchased for resale in our direct to consumer distribution channels.
We expect equipment revenue to decrease due to the transition to our next generation chipset at higher costs. Sirius XM Other Revenue includes service and advisory revenue from Sirius XM Canada, revenue from our connected vehicle services, and ancillary revenues.
We expect equipment revenue to remain flat as higher costs associated with the transition to our next generation chipset are projected to offset the benefits of increased production. Sirius XM Other Revenue includes service and advisory revenue from Sirius XM Canada, revenue from our connected vehicle services, and ancillary revenues.
At December 31, 2023, Pandora had approximately 6,008 subscribers, a decrease of 207, or 3%, from the approximately 6,215 subscribers as of December 31, 2022. For the years ended December 31, 2023 and 2022, net subscriber additions were (207) and (178), respectively, a decrease of 16%, or 29.
At December 31, 2024, Pandora had approximately 5,774 subscribers, a decrease of 279, or 5%, from the approximately 6,053 subscribers as of December 31, 2023. For the years ended December 31, 2024 and 2023, net subscriber additions were (279) and (199), respectively.
Sirius XM Our Sirius XM business features music, sports, entertainment, comedy, talk, news, traffic and weather channels and other content, as well as podcasts and infotainment services, in the United States on a subscription fee basis. Sirius XM's packages include live, curated and certain exclusive and on demand programming.
SiriusXM Our SiriusXM business features a wide range of content, including, music, sports, entertainment, comedy, talk and news channels, podcasts and infotainment services, all available in the United States on a subscription fee basis. SiriusXM's content bundles include live, curated and certain exclusive and on demand programming.
(See the accompanying Glossary for more details.) For the years ended December 31, 2023 and 2022, SAC, per installation, was $13.18 and $14.32, respectively. The decrease was driven by a change in the mix of OEMs. Pandora and Off-platform Monthly Active Users.
(See the accompanying Glossary for more details.) For the years ended December 31, 2024 and 2023, SAC, per installation, was $14.55 and $13.18, respectively. The increase was driven by a transition to higher cost chipsets, partially offset by a change in the mix of automakers including satellite radios in their vehicles. Pandora and Off-platform Monthly Active Users.
Sirius XM Customer Service and Billing includes costs associated with the operation and management of internal and third party customer service centers, and our subscriber management systems as well as billing and collection costs, bad debt expense, and transaction fees.
We expect our Sirius XM programming and content expenses to remain relatively flat. Sirius XM Customer Service and Billing includes costs related to the operation and management of internal and third-party customer service centers, our subscriber management systems, billing and collection processes, bad debt expense, and transaction fees.
At December 31, 2023, Pandora had approximately 46,026 monthly active users, a decrease of 1,612 monthly active users, or 3%, from the 47,638 monthly active users as of December 31, 2022. The decrease in monthly active users was driven by an increase in ad-supported listener churn and a decline in the number of new users. Subscribers.
At December 31, 2024, Pandora had approximately 43,344 monthly active users, a decrease of 2,682 monthly active users, or 6%, from the 46,026 monthly active users as of December 31, 2023. The decrease in monthly active users was driven by higher churn and a decline in the number of new users. Subscribers.
Refer to our Form 10-K for the year ended December 31, 2022 filed with the SEC on February 2, 2023 for our Non GAAP financial and operating performance measures for the year ended December 31, 2022 compared with the year ended December 31, 2021.
Refer to Amendment No. 1 to our Registration Statement on Form S-4 filed with the SEC on March 20, 2024 for our Non-GAAP financial and operating performance measures for the year ended December 31, 2023 compared with the year ended December 31, 2022.
As of December 31, 2023, the gross liability for income taxes associated with uncertain tax positions was $171. Glossary Monthly active users - the number of distinct registered users on the Pandora services, including subscribers, which have consumed content within the trailing 30 days to the end of the final calendar month of the period.
Monthly active users - the number of distinct registered users on the Pandora services, including subscribers, which have consumed content within the trailing 30 days to the end of the final calendar month of the period.
For the years ended December 31, 2023 and 2022, programming and content expenses were $69 and $58, respectively, an increase of 19%, or $11, and increased as a percentage of total Pandora revenue. The increase was primarily attributable to higher podcast license fees and live event costs, partially offset by lower personnel-related costs.
For the years ended December 31, 2024 and 2023, programming and content expenses were $61 and $69, respectively, a decrease of 12%, or $8, and decreased as a percentage of total Pandora and Off-platform revenue. The decrease was primarily attributable to lower personnel-related costs, license fees, and event costs.
For a discussion of our “Debt Covenants,” refer to Note 13 to our consolidated financial statements in Part II, Item 8, of this Annual Report on Form 10-K.
As of December 31, 2024, we were in compliance with such covenants. For a discussion of our “Debt Covenants,” refer to Note 13 to our audited consolidated financial statements included in this Annual Report on Form 10-K.
For the years ended December 31, 2023 and 2022, Pandora and Off-platform subscriber revenue was $524 and $522, respectively, an increase of less than 1%, or $2. The increase was primarily driven by a rate increase on Pandora Plus, partially offset by a decline in the subscriber base. We expect Pandora and Off-platform subscriber revenues to remain flat.
For the years ended December 31, 2024 and 2023, Pandora and Off-platform subscriber revenue was $540 and $524, respectively, an increase of 3%, or $16. The growth was primarily driven by rate increases on Pandora subscription plans, partially offset by a decline in the subscriber base.
The decrease was due to higher web royalty and podcast revenue share costs as well as lower overall revenue, partially offset by lower sales and marketing costs. Free Cash Flow includes cash provided by operations, net of additions to property and equipment, and restricted and other investment activity.
The decrease was driven by declines in subscriber revenue, partially offset by lower costs of services, personnel-related costs, sales and marketing and general and administrative expenses. Free Cash Flow includes cash provided by operations, net of additions to property and equipment, and restricted and other investment activity.
The payments on these equity investments will be classified as investing activities from a cash flow perspective, while the tax credits and losses will benefit our federal cash taxes in operating activities. Capital Return Program As of December 31, 2023, our board of directors had authorized for repurchase an aggregate of $18,000 of our common stock.
The payments on these equity investments will be classified as investing activities from a cash flow perspective, while the tax credits and losses will benefit our federal cash taxes in operating activities.
As of December 31, 2023, our cumulative repurchases since December 2012 under our stock repurchase program totaled 3,731 shares for $16,834, and $1,166 remained available for additional repurchases under our existing stock repurchase program authorization.
As of December 31, 2024, our cumulative repurchases since the closing of the Transactions under our stock repurchase program totaled 301 thousand shares for $7, and $1,160 remained available for additional repurchases under our existing stock repurchase program authorization.
For the years ended December 31, 2023 and 2022, engineering, design and development expenses were $322 and $285, respectively, an increase of 13%, or $37, and increased as a percentage of total revenue. The increase was driven primarily by higher cloud hosting and personnel-related costs.
For the years ended December 31, 2024 and 2023,product and technology expenses were $296 and $322, respectively, a decrease of 8%, or $26, and decreased as a percentage of total revenue. The decrease was primarily driven by higher capitalized personnel-related costs, which were partially offset by increased cloud hosting costs.
Our Sirius XM service is also available through our in-car user interface, which we call “360L,” that combines our satellite and streaming services into a single, cohesive in-vehicle entertainment experience. The primary source of revenue from our Sirius XM business is subscription fees, with most of our customers subscribing to monthly, quarterly, semi-annual or annual plans.
Additionally, our user interface, “360L,” integrates satellite and streaming services into a seamless in-vehicle entertainment experience. 45 Table of Contents The primary source of revenue from the SiriusXM business is subscription fees, with most of its customers subscribing to monthly or annual plans.
The decrease was a result of a decline in sell-through of advertising spots. 49 Table of Contents Total Company Adjusted EBITDA. EBITDA is defined as net income before interest expense, income tax expense and depreciation and amortization.
The increase was driven by growth in advertising spots sold per listener hour. 55 Table of Contents Total Company Adjusted EBITDA. EBITDA is defined as net (loss) income before interest expense, income tax expense and depreciation and amortization.
We expect our Sirius XM revenue share and royalty costs to remain relatively flat as higher royalty rates under the statutory webcasting license resulting from increases in the Consumer Price Index are anticipated to be offset by lower eligible subscription revenue. Sirius XM Programming and Content includes costs to acquire, create, promote and produce content.
We expect our Sirius XM revenue share and royalty costs to remain flat as a percentage of revenue but to decrease overall. We project lower eligible subscription revenue, partially offset by higher royalty rates under the statutory webcasting license due to increases in the Consumer Price Index.
As of December 31, 2023, no amount was outstanding under our Credit Facility and $1,750 was available for future borrowing under our Credit Facility.
As of December 31, 2024, $1,750 was available for future borrowing under the Credit Facility and zero was available under the Incremental Term Loan.
For the Years Ended December 31, 2023 vs 2022 Change (subscribers in thousands) 2023 2022 Amount % Sirius XM Self-pay subscribers (445) 348 (793) nm Paid promotional subscribers 15 (76) 91 nm Net additions (430) 272 (702) nm Weighted average number of subscribers 33,993 34,039 (46) — % Average self-pay monthly churn 1.6 % 1.5 % 0.1 % 7 % ARPU (1) $ 15.56 $ 15.63 $ (0.07) — % SAC, per installation $ 13.18 $ 14.32 $ (1.14) (8) % Pandora and Off-platform Self-pay subscribers (207) (109) (98) (90) % Paid promotional subscribers — (69) 69 nm Net additions (207) (178) (29) (16) % Weighted average number of subscribers 6,169 6,308 (139) (2) % Ad supported listener hours (in billions) 10.48 10.88 (0.40) (4) % Advertising revenue per thousand listener hours (RPM) $ 99.39 $ 101.19 $ (1.80) (2) % Total Company Adjusted EBITDA $ 2,790 $ 2,833 $ (43) (2) % Free cash flow $ 1,203 $ 1,551 $ (348) (22) % nm - not meaningful (1) ARPU for Sirius XM excludes subscriber revenue from our connected vehicle services of $161 and $182 for the years ended December 31, 2023 and 2022, respectively. 48 Table of Contents Sirius XM Subscribers.
For the Years Ended December 31, 2024 vs 2023 Change (subscribers in thousands) 2024 2023 Amount % Sirius XM Self-pay subscribers (296) (445) 149 33 % Paid promotional subscribers (353) 15 (368) nm Net additions (649) (430) (219) (51) % Weighted average number of subscribers 33,292 33,993 (701) (2) % Average self-pay monthly churn 1.6 % 1.6 % — % — % ARPU (1) $ 15.21 $ 15.56 $ (0.35) (2) % SAC, per installation $ 14.55 $ 13.18 $ 1.37 10 % Pandora and Off-platform Self-pay subscribers (2) (279) (199) (80) (40) % Net additions (279) (199) (80) (40) % Weighted average number of subscribers 5,929 6,169 (240) (4) % Ad supported listener hours (in billions) 9.94 10.48 (0.54) (5) % Advertising revenue per thousand listener hours (RPM) $ 100.59 $ 99.39 $ 1.20 1 % Total Company Adjusted EBITDA $ 2,732 $ 2,790 $ (58) (2) % Free cash flow $ 1,015 $ 1,182 $ (167) (14) % nm - not meaningful (1) ARPU for Sirius XM excludes subscriber revenue from our connected vehicle services of $164 and $161 for the years ended December 31, 2024 and 2023, respectively.
For the years ended December 31, 2023 and 2022, general and administrative expenses were $550 and $525, respectively, an increase of 5%, or $25, and increased as a percentage of total revenue.
For the years ended December 31, 2024 and 2023, general and administrative expenses were $497 and $608, respectively, a decrease of 18%, or $111, and decreased as a percentage of total revenue.
Impairment, Restructuring and Acquisition Costs represents impairment charges, associated with the carrying amount of an asset exceeding the asset's fair value, restructuring expenses associated with the abandonment of certain leased office spaces, acquisition costs and costs associated with the Transactions. For the years ended December 31, 2023 and 2022, impairment, restructuring, and acquisition costs were $82 and $64, respectively.
Impairment, Restructuring and Other Costs represents impairment charges, associated with the carrying amount of an asset exceeding the asset's fair value, restructuring expenses associated with the abandonment of certain leased office spaces as well as employee severance charges and other charges associated with organizational changes, and costs associated with the Transactions.
The reconciliation of net income to the adjusted EBITDA is calculated as follows: For the Years Ended December 31, 2023 2022 Net income: $ 1,258 $ 1,213 Add back items excluded from Adjusted EBITDA: Legal settlements and reserves 24 — Impairment, restructuring and acquisition costs 82 64 Share-based payment expense (1) 184 197 Depreciation and amortization 554 536 Interest expense 423 422 Other expense 5 9 Income tax expense 260 392 Adjusted EBITDA $ 2,790 $ 2,833 (1) Allocation of share-based payment expense: For the Years Ended December 31, 2023 2022 Programming and content $ 34 $ 34 Customer service and billing 5 6 Transmission 6 6 Sales and marketing 45 52 Engineering, design and development 46 39 General and administrative 48 60 Total share-based payment expense $ 184 $ 197 55 Table of Contents Free cash flow - is derived from cash flow provided by operating activities, net of additions to property and equipment and purchases of other investments.
The reconciliation of net (loss) income to the adjusted EBITDA is calculated as follows: For the Years Ended December 31, 2024 2023 Net (loss) income: $ (2,075) $ 988 Add back items excluded from Adjusted EBITDA: Legal settlements and reserves 3 31 Former Parent operating costs 15 32 Impairment, restructuring and other costs 3,453 92 Share-based payment expense (1) 200 203 Depreciation and amortization 578 624 Interest expense 496 534 Gain on extinguishment of debt (12) — Other (income) expense, net (136) 64 Income tax expense 210 222 Adjusted EBITDA $ 2,732 $ 2,790 (1) Allocation of share-based payment expense: For the Years Ended December 31, 2024 2023 Programming and content $ 36 $ 34 Customer service and billing 5 5 Transmission 5 6 Sales and marketing 45 45 Product and technology 44 46 General and administrative 65 67 Total share-based payment expense $ 200 $ 203 62 Table of Contents Free cash flow - is derived from cash flow provided by operating activities, net of additions to property and equipment and purchases of other investments.
For the years ended December 31, 2023 and 2022, revenue share and royalties were $1,603 and $1,552, respectively, an increase of 3%, or $51, and increased as a percentage of total Sirius XM revenue. The increase was driven by higher web streaming royalty rates as well as the expiration of certain licenses covering pre-1972 sound recordings.
For the years ended December 31, 2024 and 2023, revenue share and royalties were $1,565 and $1,603, respectively, a decrease of 2%, or $38, but increased as a percentage of total Sirius XM revenue. The decrease was driven by lower subscription revenue, partially offset by higher web streaming royalty rates.
Refer to our Form 10-K for the year ended December 31, 2022 filed with the SEC on February 2, 2023 for our cash flows for the year ended December 31, 2022 compared with the year ended December 31, 2021.
Refer to Amendment No. 1 to our Registration Statement on Form S-4 filed with the SEC on March 20, 2024 for our cash flows for the year ended December 31, 2023 compared with the year ended December 31, 2022.
The size and timing of any purchases will be based on a number of factors, including price and business and market conditions.
We intend to fund any stock repurchases through a combination of cash on hand, cash generated by operations and future borrowings. The size and timing of any purchases will be based on a number of factors, including price and business and market conditions.
For the years ended December 31, 2023 and 2022, ad supported listener hours were 10.48 billion and 10.88 billion, respectively. The decrease in ad supported listener hours was primarily driven by the decline in monthly active users, partially offset by higher hours per active user.
For the years ended December 31, 2024 and 2023, ad supported listener hours were 9,940 and 10,480, respectively, a decrease of 5%, or 540. The decrease in ad supported listener hours were primarily driven by the decline in monthly active users.
(See the accompanying Glossary for a reconciliation to GAAP and for more details.) For the years ended December 31, 2023 and 2022, free cash flow was $1,203 and $1,551, respectively, a decrease of $348, or 22%.
(See the accompanying Glossary for a reconciliation to GAAP and for more details.) For the years ended December 31, 2024 and 2023, free cash flow was $1,015 and $1,182, respectively, a decrease of 14%, or $167. The decrease was primarily driven by costs related to the Transactions, higher capital expenditures and cash taxes paid.
Sirius XM Transmission consists of costs associated with the operation and maintenance of our terrestrial repeater networks; satellites; satellite telemetry, tracking and control systems; satellite uplink facilities; studios; and delivery of our Internet and 360L streaming and connected vehicle services.
Sirius XM Transmission consists of costs associated with the operation and maintenance of our terrestrial repeater networks; satellites; satellite telemetry, tracking and control systems; satellite uplink facilities; studios; and delivery of our Internet and 360L streaming and connected vehicle services. 49 Table of Contents For the years ended December 31, 2024 and 2023, transmission expenses were $190 and $171, respectively, an increase of 11%, or $19, and increased as a percentage of total Sirius XM revenue.
The decrease was driven by higher capital expenditures driven by satellite construction and investments in our products and technology platform as well as higher cash taxes paid. Liquidity and Capital Resources The following table presents a summary of our cash flow activity for the year ended December 31, 2023 compared with the year ended December 31, 2022.
Liquidity and Capital Resources The following table presents a summary of our cash flow activity for the year ended December 31, 2024 compared with the year ended December 31, 2023.
We expect our Pandora and Off-platform revenue share and royalties to increase based on a variety of music-related factors, including higher royalty rates under the statutory webcasting license, and additional costs associated with our podcast distribution agreements. Pandora and Off-platform Programming and Content includes costs to produce, license and promote podcast content and live listener events.
We expect our Pandora and Off-platform revenue share and royalties to increase with the growth in our podcast revenue and higher royalty rates, including as a result of increases in the Consumer Price Index. Pandora and Off-platform Programming and Content includes costs to produce owned and operated podcasts, live listener events and promote content.
See “Special Note About Forward-Looking Statements.” All amounts referenced in this Item 7 are in millions, except subscriber amounts are in thousands and per subscriber and per installation amounts are in ones, unless otherwise stated.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS All amounts referenced in this Item 7 are in millions, except subscriber amounts are in thousands and per subscriber and per installation amounts are in ones, unless otherwise stated.
We also derive subscription revenue from our Pandora Plus and Pandora Premium subscribers. 39 Table of Contents We also sell advertising on other audio platforms and in widely distributed podcasts, which we consider to be off-platform services.
Our Pandora and Off-platform business also sells advertising on other audio platforms and in widely distributed podcasts, which we consider to be off-platform services. Sirius XM also sells advertising on other audio platforms and in widely distributed podcasts, which it considers to be off-platform services.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

4 edited+5 added−1 removed2 unchanged
The basic objectives of our investment policy are the preservation of capital, maintaining sufficient liquidity to meet operating requirements and maximizing yield. As of December 31, 2023, we also held the following investment: In connection with the recapitalization of Sirius XM Canada on May 25, 2017, we loaned Sirius XM Canada $130.8 million.
The basic objectives of our investment policy are the preservation of capital, maintaining sufficient liquidity to meet operating requirements and maximizing yield. As of December 31, 2024, we also held the following investment: In connection with the recapitalization of Sirius XM Canada on May 25, 2017, we loaned Sirius XM Canada $130.8 million.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK As of December 31, 2023, we did not hold or issue any derivatives. We hold investments in money market funds and certificates of deposit. These securities are consistent with the objectives contained within our investment policy.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK As of December 31, 2024, we did not hold or issue any derivatives. We hold investments in money market funds and certificates of deposit. These securities are consistent with the objectives contained within our investment policy.
The carrying value of the loan as of December 31, 2023 was $8.0 million and approximated its fair value. The loan is denominated in Canadian dollars and it is subject to changes in foreign currency. The loan is considered a long-term investment with any unrealized gains or losses reported within Accumulated other comprehensive (loss) income.
The carrying value of the loan as of December 31, 2024 was $7.0 million and approximated its fair value. The loan is denominated in Canadian dollars and it is subject to changes in foreign currency. The loan is considered a long-term investment with any unrealized gains or losses reported within Accumulated other comprehensive (loss) income.
Had the Canadian to U.S. dollar exchange rate been 10% lower as of December 31, 2023, the value of this loan would have been approximately $0.8 million lower. Our debt includes fixed rate instruments and the fair market value of our debt is sensitive to changes in interest rates.
Had the Canadian to U.S. dollar exchange rate been 10% lower as of December 31, 2024, the value of this loan would have been approximately $0.7 million lower.
Removed
Sirius XM's borrowings under the Credit Facility carry a variable interest rate, which is currently based on SOFR, plus an applicable rate based on its debt to operating cash flow ratio. We currently do not use interest rate derivative instruments to manage our exposure to interest rate fluctuations. ITEM 8.
Added
We are exposed to changes in interest rates primarily as a result of our borrowing and investment activities, which include investments in fixed and floating rate debt instruments and borrowings used to maintain liquidity and to fund business operations.
Added
The nature and amount of our long- and short-term debt are expected to vary as a result of future requirements, market conditions and other factors. We manage our exposure to interest rates by maintaining what we believe is an appropriate mix of fixed and variable rate debt. We believe this best protects us from interest rate risk.
Added
We have achieved this mix by (i) issuing fixed rate debt that we believe has a low stated interest rate and significant term to maturity and (ii) issuing variable rate debt with appropriate maturities and interest rates.
Added
As of December 31, 2024, we had $1,086 million principal amount of variable rate debt outstanding with a weighted average interest rate of 6.1% and $9,325 million principal amount of fixed rate debt with a weighted average interest rate of 4.3%.
Added
Accordingly, as of December 31, 2024, based on the amount of variable rate debt outstanding and the then-current Term SOFR rate, a hypothetical 10% increase in interest rates would have increased annual interest expense by approximately $5 million and a hypothetical 10% decrease in interest rates would have decreased annual interest expense by approximately $5 million. ITEM 8.

Other SIRI 10-K year-over-year comparisons