Down 50%, What’s Happening With Sirius Stock?

February 20th, 2025 by Trefis Team

Although Sirius XM Holdings stock (NASDAQ: SIRI) has rebounded by 11% in 2025 year-to-date, following a better-than-expected Q4 earnings report, it remains substantially below its 2024 beginning levels, down by 54%. This decline contrasts sharply with the S&P index’s and SIRI’s peer Apple’s  (NASDAQ:AAPL) 28% stock rise over the same period. The primary driver of SIRI’s underperformance is its disappointing 2024 results, characterized by declining revenue, subscriber numbers, and free cash flow. Sirius is facing a concerning revenue trend, with declines in FY’23 and FY’24, and another decline projected for FY’25, marking three consecutive years of revenue contraction. Furthermore, the company’s subscriber base has contracted by approximately 5% since its peak in 2019.

In FY 2024, SIRI revenues fell 3% year-over-year (y-o-y) to $8.7 billion. The revenue decline was driven by a 4% drop in subscriber revenue to $6.6 billion, a 1% growth in advertising revenue to $1.8 billion, and a 6% decline in equipment and other revenues at $310 million. Regarding subscription metrics, the company reported a decline of 2% year-over-year (y-o-y) to 33.2 million in total subscribers, including paid promotions in FY 2024. This decrease can be attributed to lower vehicle conversion rates. However, the self-pay churn rate has remained stable at 1.6% in FY’24, indicating that existing subscribers are being retained at a consistent rate. That said, Sirius will have to focus solely on its content to compete with the bigger and more resourceful competitors to grow its business. The company’s management has already announced a lower 2025 investment plan to focus on the company’s in-vehicle listening audience. As part of the plan, Sirius aims for an additional $200 million in cost cuts and thus forecasts an increase in free cash flow to $1.15 billion in 2025, up from $1.02 billion in 2024.

Image by Dominic Flamini from Pixabay

Sirius’ Q4 results offered a glimmer of hope, with the core Sirius XM segment adding 70,000 net subscribers, its first quarterly increase since Q2 2023, driven by 149,000 self-pay additions, partially offset by a decline of 79,000 subscribers in paid promotions. While the 2024 subscriber base remained relatively unchanged by this addition, the uptick marks a significant inflection point for the company. Investors should closely monitor whether Sirius can maintain this momentum as it continues to refine its offerings and invest in emerging trends, including more tailored packages and premium content.

We forecast Sirius XM’s Revenue to be almost $8.5 billion for the full year 2025, down 2% y-o-y. Given the changes to our revenues and EPS forecast, we have revised our Sirius XM’s Valuation to around $25 per share, based on a $3.01 expected EPS and an 8.2x P/E multiple for fiscal 2025 – almost in line with the current market price (as of Feb 19).

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