NEW YORK -- XM Satellite Radio Holdings Inc. on Thursday reported a smaller second-quarter net loss on a 55 percent jump in subscribers to its pay-radio service, and it raised its forecast for new customers this year.
The Washington-based company, which leads the nascent market over rival Sirius Satellite Radio Inc., said its net loss for common shareholders narrowed to $148.7 million, or 70 cents a share, from $168.2 million, or 84 cents a share, a year earlier.
Revenue doubled to $125.5 million from $53 million and exceeded Wall Street's expectations of $123 million.
XM added 647,226 subscribers and ended the quarter with 4.4 million, more than double its total a year earlier. Its rate of "churn," a measure of subscriber cancellations, was steady at 1.4 percent.
XM raised its 2005 subscriber forecast to 6 million from 5.5 million.
Analysts praised the results, pointing to the smaller loss and to the subscriber increases, which drive revenue growth.
"This is proof that their business model does work, and they are keeping fixed cost in line," said analyst April Horace of Hoefer & Arnett.
Cost per gross addition fell 3 percent to $98 from $101 in second quarter 2004, the company said. The figures represent subscriber acquisition costs of $50 each, as well as advertising and marketing expenses.
The company attributed the quarterly gains in part to customers' interest in its comprehensive broadcasts of Major League Baseball games. It also said business from automotive partner General Motors, whose cars are equipped with XM's satellite radios, was strong.