Sirius XM Raises 2026 Guidance for a Second Straight Quarter

The Tip Desk · October 30, 2026 · 3 min read

Third-quarter revenue was $2.15 billion as the audio company lifted full-year revenue, Adjusted EBITDA and free cash flow guidance by $25 million each.

Sirius XM Holdings (SIRI) raised its full-year 2026 guidance for a second consecutive quarter, increasing each of revenue, Adjusted EBITDA and free cash flow by $25 million after a third quarter in which self-pay net additions improved 45,000 from a year earlier.

The audio entertainment company now expects approximately $8.55 billion of revenue, $2.65 billion of Adjusted EBITDA and $1.40 billion of free cash flow for 2026. In the second quarter it had already lifted the same three metrics by $25 million.

Consolidated revenue was $2.15 billion, down slightly year-over-year, after rising 1% to $2.16 billion in the second quarter. The company said the decline primarily reflected lower equipment revenue due to higher memory costs. Net income increased 7% to $317 million. Diluted earnings were $0.78 a share, down 7% from $0.84, reflecting the accounting treatment of convertible notes, including fair-value gains and assumed share dilution.

Adjusted EBITDA grew 3% year-over-year to $694 million, with margin expanding one percentage point to 32%. The company attributed the result to stable revenue and disciplined expense management, including lower programming expenses, greater automation in customer care and reduced sales and marketing spending. Free cash flow increased 14% year-over-year to $293 million, which the company said was due to higher Adjusted EBITDA, favorable working capital, lower interest expense and reduced capital expenditures.

Self-pay net additions were 5,000, after 22,000 in the second quarter. Self-pay monthly churn was approximately 1.5%. The company said performance was driven by growing adoption of companion subscriptions, which added 107,000 incremental self-pay net additions, as well as continued benefits from its continuous service initiative and momentum in automotive dealer extended-duration plans, more than offsetting lower conversion rates. SiriusXM ended the quarter with approximately 33 million total subscribers. Paid promotional subscribers increased 21,000 year-over-year to 1.594 million. The total trial funnel stood at 7.4 million.

SiriusXM segment revenue was $1.60 billion, relatively flat year-over-year. Subscriber revenue increased modestly to $1.50 billion, with ARPU largely stable at $15.18. The company said rate increases on certain self-pay plans and improved discount mix were partially offset by a growing mix of value-add and more affordable subscription offerings. Advertising revenue declined 5% to $37 million, reflecting softer demand across news programming and direct-to-consumer advertisers, partially offset by continued strength in sports. Equipment revenue decreased 16% year-over-year, primarily reflecting higher memory costs associated with hardware modules. Gross profit increased 1% to $963 million and gross margin expanded one percentage point to 60%.

Pandora and Off-Platform revenue increased modestly year-over-year to $549 million. Advertising revenue grew 1% to $419 million, driven by strength in podcasting, programmatic advertising and technology fees, partially offset by softer streaming music advertising, reflecting lower listening hours. Subscriber revenue declined 2% to $130 million, primarily due to lower subscriber volumes. Pandora Plus and Pandora Premium ended the quarter with approximately 5.5 million self-pay subscribers, while monthly active users totaled 38.8 million. Gross profit increased 2% to $173 million and gross margin expanded one percentage point to 32%.

Programming costs declined 6% year-over-year to $136 million, customer service and billing expenses decreased 6% to $108 million, and sales and marketing expenses declined 4% to $169 million. Subscriber acquisition costs were unchanged at $107 million. The company ended the third quarter with a net debt-to-adjusted EBITDA ratio of 3.3x.

Chief Financial Officer Zac Coughlin said the company delivered approximately $1.1 billion in free cash flow for the first nine months of the year, achieved its long-term leverage target and strengthened financial flexibility. He said a more efficient operating model and declining satellite capital expenditures position the company to meaningfully accelerate share repurchases in 2027 while continuing to invest in the business.