As Jennifer noted, the first quarter played out as we expected, albeit with a bit stronger finish to our advertising revenue performance and gradually improving trial starts. And how is that progressing over the course of this year in your view? I'm truly excited about this opportunity and join the conversation with investors and analysts and meet many of you in the coming weeks. This decline of $114 million is principally the result of increased satellite capex of $103 million as we invested the construction of SXM-11 and 12 and a one-time severance payment of approximately $15 million related to our cost optimization strategy. While we continue to see opportunities for a bigger streaming-only business, car sales will remain the dominant driver of our subscriber funnel. Hi. We also launched Fluency, a cultural practice, helping brands connect with young, diverse audiences in audio by providing insights to support campaigns and creative strategy. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services. And once again, we saw the seasonally higher churn we tend to see in Q1. And right now were certainly seeing significant take up in Android automotive operating system, the integrated software from Google. So it's like anything else. Please proceed with your questions. Like how should we think about the cadence of ARPU from here this year? Seasonality in advertising revenue in these strategic cost saving measures should deliver ramping EBITDA in the second, third and fourth quarter. Thank you, Jennifer. And Sean, best of luck in your new opportunity. Sirius XMs Q1 2023 earnings per share is expected to be 8 cents as per Trefis analysis, higher than the consensus estimate of 7 cents. Thanks for that color. Nonetheless, if you are looking for a conservative Our team is working diligently to position us for success in the second half of 2023 and beyond, and I'm excited to see how this year shapes up. Listen online or download the iHeart App. But SiriusXM has their own ad-revenue on those news shows. Please proceed with your questions. @SIRIUSXM is. Our next question is coming from the line of Stephen Laszczyk with Goldman Sachs. And the cost to acquire trials has gone down. I also cancelled my SiriusXM as Fox News was the ONLY thing I listened to on that. Ben Swinburne -- Morgan Stanley -- Analyst. With these trends and more targeted cost control initiatives, we're now able to increase our full-year guidance for adjusted EBITDA from $2.7 billion to approximately $2.75 billion, and our free cash flow expectations from $1.05 billion to approximately $1.1 billion. On the self-pay side, I would continue to expect improvement in year-over-year comps as we roll out the rate increase. Read our full review of Fubo TV and visit our TV guide to Fubo TV to find out what you can watch right now. Please proceed with your questions. Although we continue to be cautious about the overall ad sales market, we still see tailwinds in podcasting. Mr. Stevens, you may now begin. Could you give us a little bit of color on sort of the puts and takes there and how the new next-generation SiriusXM experience will help improve that over the course of 2023? You can watch Newsmax TV on your Pixel or Samsung or Nokia or whatever type of Android you have! Obviously, as we said at the year-end call that a lot of our free cash flow and a lot of our numbers will be coming in the second half of the year, but we're going to continue with our disciplined approach, as we've used over the last couple of years. And then over time, in the years to come, it will get to 80% of our trial starts. Gross profit in the Pandora and Off-Platform segment totaled $111 million. *Stock Advisor returns as of April 24, 2023. Or is there anything different that you can talk to at this point? We also delivered better-than-expected ad revenue partly due to our leading self-service and programmatic solutions that are allowing us to capture close-end bookings, and I will address this more in a few minutes. The Motley Fool has no position in any of the stocks mentioned. Sirius XM's guidance calls for $9 billion in revenue this year, flat with where it landed in 2022. We are making significant progress in rolling out our 360L platform and expect to exit 2023 with nearly 40% of new car trials including 360L. The difference is whether or not you listen to satellite radio in your car. It allows us like many other services to update much more frequently our feature set. Read on to learn which streamers support both your device and Newsmax TV live streams. First of all, Sean, thanks very much. And while that growth will continue, it's actually come down to more normalized level at this point. Sirius followed their initial launch with two more which gives them a total of three active satellites in orbit which deliver high-quality radio programs. Our next question is from the line of Steven Cahall with Wells Fargo. 360L mix is also sounds like tracking up nicely. Great. So its rolling out. How sizable of a trial acquisition funnel you think that could become over the next few years, and maybe how you see that fitting into the broader digital strategy later this year. While our top pick is Sling, there are 2 other ways to watch live programming, including Fubo TV or DirecTV Stream. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. We are already beginning to see benefits from cost reductions implemented in Q1 across every element of our business. Just to talk about my whiteboard, what we're focused on. Thanks, Matt. Great. The growth catalysts just aren't there. Read our full review of DirecTV Stream and visit our TV guide to DirecTV Stream to find out what you can watch right now. We're in about -- I think it's about a third of our new car trial starts have 360L currently, that will increase to about 40% by the end of the year. Thank you for your participation. I will start on advertising and hand it over to Scott on your second question. I was hoping you can maybe talk a little bit more about the third-party distribution strategy. Youve certainly been very tolerant of views on all sides of the spectrum. Tom Barry -- Incoming Chief Financial Officer. Witz noted however that their financial metrics exceeded their expectations for the year, and it was enough for the company to raise its financial guidance for full-year earnings from $2.7 billion to approximately $2.75 billion. Podcast audio version of Newsmax TVs Greg Kelly Reports. Just subscribe to Sling, Fubo TV, or DirecTV Stream to get Newsmax TV on your Android smart TV. Furthermore, OAN (One American News), known as a great The investments we are making now will support our remaining valuable low band customers for several years to come, but well eventually provide new revenue opportunities. Gross profit in the SiriusXM segment declined 5% to $1.02 billion, representing a margin of 61%, down slightly from 2022 due to higher royalties. We also delivered better-than-expected ad revenue, partly due to our leading self-service and programmatic solutions that are allowing us to capture closed-end bookings, and I will address this more in a few minutes. Our extensive portfolio includes chart-topping podcasts by Earwolf and Team Coco and exclusive channels featuring A-list talent like Andy Cohen Inks and Conan OBrien. We are making significant progress in rolling out our 360L platform, and expect to exit 2023 with nearly 40% of new car trials, including 360L. We expect this margin to trend favorably for the remainder of the year. So your commentary on the intent to buy and the improving funnel sounds constructive. Fubo TV isn't only great for sports fans, though. Podcasting ad revenue was up 34% year over year in the quarter, and that's due to the great content relationships we have on the representation side, our ability to bring brands into podcasting. Please. Our Q1 results were better than we expected, certainly based on where trends were heading in December or January, we had a really solid quarter with ad revenue down just 2%. Thank you. So its like anything else. A question-and-answer session will follow the formal presentation. On the positive side, however, our test-and-learn strategy will enable us to improve streaming subscriber results sequentially throughout the remainder of the year, even with a lower baseline of spend. Youre reading a free article with opinions that may differ from The Motley Fools Premium Investing Services. Scott Greenstein, our President and Chief Content Officer, will join Jennifer, Sean and Tom to take your questions during the Q&A portion of the call. Bye-Bye. Sirius XMs Q1 2023 earnings per share is expected to be 8 cents as per Trefis analysis, higher than the consensus estimate of 7 cents. Thanks Matt. We see significant in-car conversion improvements when trialers engage with features that enable more control in discovery, including our more targeted extra channels, Pandora artist stations, and enhanced recommendations. I will now turn the call over to Sean for some brief remarks, and then Tom will go through the financials in more detail. No, Newsmax TV isn't included in your Philo subscription. Thanks. Because of this typical seasonality of our business in terms of receipts versus expenditures, combined with the timing of our capital expenditures, we expect to produce a meaningful portion of 2023s free cash flow later in the year. Start watching with a free trial. And I guess what I wanted to ask about is just a follow-up on the subscriber progression here. Great. You have three options to watch It had 34 million subscribers as of March 31. Thank you. And as we have always said, business models really do matter. For example, we introduced a new in-app onboarding experience for users to select genres allowing faster, more efficient access to the most relevant content. And, Sean, best of luck in your new opportunity. But were still waiting to launch a lot of these underlying capabilities and functionality to be able to support the streaming business, not only for streaming-only subscribers, but also as it continues to support our in-car business through customers listening outside of the car and 360L in the car. In the Pandora and Off-Platform segment, total revenue was $462 million, nearly flat with prior year. And we do expect auto sales to continue to grow. At this time all participants are in a listen-only mode. Is that still what you see? Image source: The Motley Fool. Sirius XM's guidance implies that its self-pay subscriber count will decline this year. And again, I kind of apologize for the question, but Id love I cant resist. Anything different here going forward that we should be mindful of relative to that we thought about it in the past? And we will continue to be active in generating trials. What are you guys seeing among OEMs in terms of their positioning around third-party interfaces on the DASH versus their own? And we're working closely with the OEMs and with Google is that rolls out, the majority of OEMs have either announced or in process of moving toward that operating system. With a huge number of subscription plans covering every conceivable way to get entertained, Sirius XM is one of the best entertainment platforms around for sure. Newsmax is going to be moving into other audio opportunities, Lee Kinberg, CEO of Newsmax Radio, said. I will start on advertising and hand it over to Scott on your second question. Today, we'll have prepared I mean, what portion are coming in on that platform? Gross profit in the Pandora and off-platform segment was $111 million, down 19% and representing a margin of 24%. Pandora was supposed to be a catalyst for growth, a digital escape hatch the moment that satellite radio would prove transitory and eventually obsolete. And it's driven a lot by the programming additions that we've made and the streaming access. Our new platform will streamline purchasing and usage in and out of the car, and enhance the value of SiriusXM, making our service worth the premium for a wider range of audience segments. Thank you. We expected Q1 to be a low point in terms of net adds. Subscribe to Sling, Fubo TV, or DirecTV Stream to get Newsmax TV on Roku. And on that note, Tom if you could just give us an idea, your key priorities coming into the role, sort of whats at the top of the bullet point list on the whiteboard in your office? Other channels on DirecTV Stream include: Cable News Network, HLN, Turner Classic Movies, TV Land, A&E, AMC, BET, Bravo, Comedy Central, Discovery Family Channel, E! But our team's pick for most people to watch Newsmax TV, is Sling. But are there any circumstances where if I was Tucker or Don Lemon, why would I certainly want to be with you on the linear and podcasting side rather than Newsmax or OEM, but is that just two friends for you. The beat remains the same, even if this isn't likely to be a beat on Thursday. When it cuts to commercial break, notice how its NOT the same ads? On the used car market, just to start with that, the used car sales were actually pretty strong in the first couple months of the year. So what's key is the rollout, and this has been a long time coming, and the promise of 360L is now delivering. We have a service with very high satisfaction, low churn and one of the leading ARPUs across direct-to-consumer media, not just audio. And I believe as we launch this platform, we will have more and more opportunities to better execute on that. Partnership is sort of an untapped opportunity. Well share progress on future quarterly calls, but the first months of 2023 have already brought several exciting product iterations and consumer offers providing valuable insights for the full platform re-launch later this year. Music, radio and podcasts, all free. Any commentary on how those are contributing to either the modest decline or the growing funnel and what we should expect for used car activity this year? SiriusXM also launched Team Coco Radio in November to leverage the podcasts that the Conan OBrien-led production studio creates. The silver lining here -- as Sirius XM plays old hits to a thinning room with no one calling for an encore -- is that the valuation is surprisingly cheap. Greetings. Using our streaming recommendation system, the Flixed team has determined that Sling is the best way for most people to watch what's live on Newsmax TV because it offers the ideal combination of price, channels, and features. Scott Greenstein, our president and chief content officer, will join Jennifer, Sean, and Tom to take your questions during the Q&A portion of the call. What do you see as the right leverage profile, the right mix of capital returns? Were increasingly flexible and even agnostic in how we add subscribers and accommodate listening preferences. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. The dynamics are tough in the market because many buyers as new car prices start to come down, may migrate from used cars to new cars, and inventories are still pretty tight on the used car side. The fourth quarter's trial starts declined sequentially by 3% and 7% for new and used vehicles, respectively, and this reduced conversion opportunities for us in the first quarter. Overall ad revenue slid 2% from a year earlier to $375 million, but Witz called those results solid and said SiriusXM benefited from its investments in ad tech, especially for its programmatic sales platform. And I think, ultimately, ARPU as well because we can deliver even more content and features to our subscribers. We advise listeners to not rely unduly on forward-looking statements and disclaim any intent or obligation to update them. But were going to continue with our disciplined approach as weve used over the last couple years. OK. And to the point on 360L, can you give us a sense of right now how material 360L is for your subscriber acquisitions? [Operator instructions] One moment please will we poll for questions? At the corporate level, G&A was up 21%, with the majority of the increase driven by litigation expenses and investment asset adjustments on our employee deferred comp plan. And while we may in fact be a potential or logical home for anybody that fits into those voices. The majority of OEMs have either announced or in process of moving toward that operating system. I am confident that Tom's perspective, diligence, financial expertise, and history with SiriusXM will serve him well as he steps into the CFO role. I'm focused on in the early days is a lot of what you'll see in raising our guidance in some of the other areas is we're investing a lot of time in our cost structure and ensuring that our spending and our cost optimization is headed the right direction with it in an effective manner. Generally, the expectation was modestly negative. Hey, good morning. We're a platform that helps consumers choose the best streaming service for them through our content, resources, and tools for navigating the streaming landscape. With that, I'll turn it over to the operator for Q&A. Our next question comes from the line of Barton Crockett with Rosenblatt Securities. Gross profit in the Sirius XM segment declined 5% to 1.02 billion, representing a margin of 61%, down slightly from 2022 due to higher royalties. This SiriusXM hack crack apk (SiriusXM Dealer App) allows its users to hack Sirius satellite radio signals and refreshes their free trials every three months. SiriusXM has announced that Howard Stern will bring his show to Miami to officially open its newest broadcast complex. These are some of the easiest to use to get Newsmax TV access without cable. Our very distribution models, subscription and ad supported reach audiences wherever and however they want to listen and bring value to the Sirius XM subscription as exemplified by recent deals with Kevin Hart, Kelly Ripa and Tom Brady. Please proceed with your question. And just on the categories, it's been continued improvement in travel, restaurants, casino, even automotive is coming back more, which makes sense, and then softness in telecom and financial services. Question on the new trends. I mean what portion are coming in on that platform? WebYou can stream NewsmaxTV with a live TV streaming service.No cable or satellite subscription needed. Podcasting continues to be a bright spot, Witz said. So we look at this probably more often than not, but we spent a lot of time looking at this. I look forward to leveraging my experience of leading the Sirius XM controllers team to more broadly work with operations and the leadership team who shaped the companys long-term direction. And whereas other services you need to sign up for a data plan, we cover the data costs ourselves. And just on the categories, its been continued improvement in travel, restaurants, casino, even automotive is coming back more, which makes sense and then softness in telecom and some financial services. Good morning, everyone. Overall, SiriusXM revenue declined two percent during Q1 versus a year ago to $2.14 billion, as its earnings also declined nine percent. The good news is that Sirius XM is trading for less than 12 times earnings with a reasonable 2.6% yield. And then on to your question on streaming net adds, we did to some extent, weve gone through this hurdle of the reduced marketing spend we had in the fourth quarter, and now were operating at a much more efficient level and the cost to acquire trials has gone down, some of thats market conditions and some of that is more efficiently buying in specific channels. Seasonality in advertising revenue and the strategic cost-saving measures should deliver ramping EBITDA in the second, third, and fourth quarter. Our Sling review also includes more about why our team loves Sling. They showed a slight decline in its revenues: down 1.9% year-on-year to $2.14bn. It has been a real pleasure to serve this company, its talented employees and our shareholders as CFO these past 2.5 years. And then to your question on streaming net ads, we did -- to some extent, we've gone through this hurdle of the reduced marketing spend we had in the fourth quarter, and now we're operating at a much more efficient level. And please let me add my welcome to Tom Berry, who may be new to this call, but is a veteran of Sirius XM and its finance organization since 2009. And is it really the downward pressure weve seen over the last few years had a lot to do with the dramatic increase we saw in pen rates over that time period. Rob Carson's background includes writing comedy for the legendary late Rush Limbaugh, and many refer to Rob as "the modern-day Rush." Our next question comes from the line of Barton Crockett with Rosenblatt Securities. At the corporate level, G&A was up 21% with the majority of the increase driven by litigation expenses and investment asset adjustments on our employee deferred comp plan. The upside to the boring turn is that the media stock is consistently profitable. https://buff.ly/41pw0RC . Thanks. 10 stocks we like better thanSirius XMWhen our analyst team hasa stock tip, it can pay to listen. Ending May 2 at 11:10AM PDT 6d 21h. Additionally, we are ramping up our marketing technology capabilities to better leverage our rich content to deliver more personalized messaging in our marketing efforts. And that may be at the top end of the range, but I still think there's opportunity. Despite market and business challenges, Im proud of our good start to the year. Hooper Stevens. But we are actually holding back largely until the launch of the new platform, which is in the fourth quarter. Pandoras ad hours were 2.59 billion, declined just 4% year-over-year as hours per active users climbed 4.5% with 21 hours per month. James Ratcliffe -- Evercore ISI -- Analyst. Sirius XM has rattled off 13 consecutive years in the black, the kind of reliability that may be boring to its early fans but is what sells out arenas and stadiums in this investing climate. Username. And that has a lot to do with maintaining our promotional plans and market are discounted plans to be able to better onboard and retain our subscriber base where it makes sense. Investors already saw that happen with the Pandora streaming service in 2022. But my overall view is to work on obviously optimizing the business, support the growth of the business and position us for the year ahead. I also want to thank Sean for his many contributions these last few years and ensuring a smooth transition. And weve settled in at this sort of range in the low-80s that I think is the optimal place for us going forward. Our strong distribution, investment in new product offerings and our unmatched content offering that provided a foundation for future growth. Thank you, and good morning, everyone. Were in about I think its about a third of our new car trial starts have 360L currently that will increase to about 40% by the end of the year. And then relatedly, I was just wondering if you could speak to whats going on in the used car market? Here youre seeing the normal effects of seasonally light ad revenue in the first quarter, combined with recent ad headwinds plus the CPI inflater to web streaming royalties. Matthew Harrigan -- The Benchmark Company -- Analyst. That's right -- theythink these 10stocks are even better buys. But are there any circumstances where if I was Tucker or Don Lemon, Id certainly want to be with you on the linear and podcasting side rather than Newsmax or OAN. And were just in the phase of really testing and learning on these rollouts and will be much better positioned when we build out some of the capabilities in the new platform in terms of easier sales flows, better onboarding, more personalized recommendations to take advantage of these partnerships going forward. Were looking at opportunities Given the new Mercedes-Benz deal and some recent price increases, what are the impacts on ARPU in the near term? So that pressure will abate to some extent. You have permission to edit this article. And obviously theres the impact of revenue share as well, and were constantly navigating the interaction of those three economic levers with increasing penetration rates where it makes sense. And we've settled in at this sort of range in the low 80s that I think is the optimal place for us going forward. The cheapest option is Sling. Because this typical seasonality of our business in terms of receipts versus expenditures, combined with the timing of our capital expenditures we expect to produce a meaningful portion of 2023's free cash flow later in the year. Put another way, the upside may seem limited heading into the media stock's report this week, but the downside could also be limited if it's a disappointing performance. And then over the last few years, especially during COVID, there was a massive acceleration in the percentage of millennials buying cars. Our top pick for most news fans to get access to Newsmax TV is DirecTV Stream.
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