Sirius XM's Q4 Earnings and Revenues Surpass Estimates, Fall Y/Y

Rogers Communications RCI reported fourth-quarter 2024 adjusted earnings of $1.04 per share, which beat the Zacks Consensus Estimate by 9.47% and increased 19.54% year over year.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Revenues of $3.92 billion beat the consensus mark by 4.08% and declined 0.03% year over year.

In domestic currency (Canadian dollar), adjusted earnings increased 23% year over year to C$1.46 per share. Total revenues increased 3% year over year, reaching C$5.48 billion, driven primarily by revenue growth in media businesses.

Rogers Communication, Inc. Price, Consensus and EPS Surprise

Rogers Communication, Inc. price-consensus-eps-surprise-chart | Rogers Communication, Inc. Quote

Wireless Details

Wireless revenues (54.4% of total revenues) increased 3.9% year over year to C$2.98 billion. Service revenues rose 1.9% to C$2.06 billion. Equipment revenues increased 8.8% to C$923 million.

Monthly mobile phone ARPU was C$58.04, up 0.14% year over year.

As of Dec. 31, 2024, the prepaid subscriber base totaled 1.106 million, representing a loss of 5K subscribers year over year. The monthly churn rate was 2.8% compared with 6.2% reported in the year-ago quarter.

As of Dec. 31, 2024, the postpaid wireless subscriber base totaled 10.77 million, representing net additions of 270K subscribers year over year. The monthly churn rate was 1.53% compared with 1.67% in the year-ago quarter.

Segment operating expenses rose 2% year over year to C$1.61 billion.

Adjusted EBITDA increased 5.89% year over year to C$1.37 billion. Adjusted EBITDA margin expanded 90 basis points (bps) on a year-over-year basis to 45.9%.

Cable Details

Cable revenues (36.2% of total revenues) increased 0.1% year over year to C$1.98 billion due to a decrease in the Home Phone and Satellite subscriber base.

Service revenues rose 0.2% year over year to C$1.97 billion. Equipment revenues decreased 11.8% on a year-over-year basis to C$15 million.

As of Dec. 31, 2024, the retail Internet subscriber count was nearly 4.273 million, representing a net increase of 111K subscribers year over year.

As of Dec. 31, 2024, total Smart Home Monitoring subscribers reached 133K, indicating an increase of 44K subscribers. The total Home Phone subscriber count was nearly 1.51 million, reflecting a loss of 122K customers in the reported quarter.

ARPA was C$140.31, lower than the C$141.96 reported in the year-ago quarter.

Segment operating expenses declined 6.5% year over year to C$814 million.

Adjusted EBITDA increased 5.22% year over year to C$1.17 billion.

Media Details

Media revenues (11.2% of total revenues) increased 10.4% year over year to C$616 million due to higher sports-related revenues, driven by higher subscriber revenues and higher revenues at the Taylor Swift Eras Tour and Toronto concerts hosted at Rogers Center.

Segment operating expenses increased 1.6% year over year to C$563 million.

The segment reported an adjusted EBITDA of $53 million, significantly up year over year due to higher revenues and expense changes.

Consolidated Results

Operating costs declined 0.37% to C$2.99 billion. As a percentage of revenues, operating costs were 54.6%.

Adjusted EBITDA rose 7.61% year over year to C$2.59 billion. Adjusted EBITDA margin expanded 210 bps to 47.2%.

Balance Sheet & Cash Flow Details

As of Dec. 31, 2024, Rogers had C$4.8 billion of available liquidity, including $0.9 billion in cash and cash equivalents and a combined C$3.5 billion available under the bank credit facility. In comparison, RCI had C$4.8 billion of available liquidity as of Sept. 30, 2024, including $0.8 billion in cash and cash equivalents and a combined C$4 billion available under the bank credit facility.

Rogers’ debt leverage ratio was 4.5 times as of Dec. 31, 2024, as a result of cost reductions, earnings growth, proceeds from asset sales and commencing the payback of acquisition-related debt.

Cash flow from operating activities was C$1.14 billion compared with C$1.89 billion generated in the previous quarter. Free cash flow was C$878 million compared with C$915 million generated in the previous quarter.

Rogers paid dividends worth C$267 million and declared a C$0.50 per share dividend.

2025 Guidance

For 2025, Rogers expects total service revenues to grow between 0-3%. Adjusted EBITDA is expected to grow in the range of 0-3%.

Capital expenditure is expected to be between C$3.8 billion and C$4 billion. Free cash flow is expected in the range of C$3-C$3.2 billion.

Rogers Communications’ Zacks Rank & Stocks to Consider

Currently, RCI carries a Zacks Rank #4 (Sell).

Akamai Technologies AKAM, AMETEK AME and DoorDash DASH are some better-ranked stocks that investors can consider in the broader sector. AKAM, AME and DASH carry a Zacks Rank #2 (Buy) each at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Akamai Technologies shares have lost 18.2% in the trailing 12 months. AKAM is set to report its fourth-quarter 2024 results on Feb. 20.

AMETEK shares have gained 12.1% in the trailing 12 months. AME is set to report its fourth-quarter 2024 results on Feb. 4.

DoorDash shares have surged 75.8% in the trailing 12 months. DASH is set to report its fourth-quarter 2024 results on Feb. 11.

Zacks Investment Research

Advanced Micro Devices AMD is expected to have benefited from strong Data Center revenues in the fourth quarter of 2024, set to be released on Feb. 4.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

AMD benefits from a robust product portfolio and expanding partner base. It continues to strengthen its footprint in the enterprise data center arena by leveraging the power of fourth-generation EPYC CPUs.

AMD, along with its partners, continues to offer solutions that enable greater data center consolidation. The company’s expanding portfolio, which includes Instinct MI300X Series data center AI accelerators and the Versal RF Series Adaptive SoCs, has been noteworthy. Partners like Dell Technologies, HPE, Lenovo and Supermicro all have the Instinct platforms in production.

The Zacks Consensus Estimate for Data Center revenues is pegged at $4.1 billion, indicating an impressive year-over-year increase of 79.71%.

Advanced Micro Devices, Inc. Revenue (TTM)

Advanced Micro Devices, Inc. revenue-ttm | Advanced Micro Devices, Inc. Quote

Click here to know how AMD’s overall fourth-quarter performance is likely to be.

Expanding Portfolio to Aid AMD’s Client Revenues in Q4

AMD’s expanding portfolio has been a key catalyst in driving the Client segment revenues.

The company has expanded its desktop portfolio with the introduction of the new Ryzen 7 9800X3D, with its “Zen 5” architecture and 2nd Gen AMD 3D V-Cache technology.

AMD’s Ryzen AI 300 Series, with 50 tops of AI compute performance for Copilot Plus PCs, is the industry’s fastest NPU.

The consensus mark for fourth-quarter 2024 Client revenues is pegged at $1.97 billion, suggesting 35.04% year-over-year growth.

AMD’s Gaming & Embedded Segments to Decline Y/Y

AMD’s Gaming segment is expected to have declined in the fourth quarter of 2024. Semi-custom sales are expected to fall as major partners continue to reduce channel inventory. AMD is also transitioning to its next-gen Radeon GPUs based on its RDNA architecture. This is also expected to have reduced revenues on a year-over-year basis.

The consensus mark for fourth-quarter Gaming revenues is pegged at $509 million, suggesting a massive 62.79% year-over-year decline.

AMD’s Embedded segment is expected to have suffered from ongoing softness in the industrial market. The consensus mark for fourth-quarter Embedded revenues is pegged at $922 million, indicating a 12.77% decline on a year-over-year basis.

What Our Model Says

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Advanced Micro Devices currently has an Earnings ESP of 0.00% and a Zacks Rank #4 (Sell). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are some companies worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:

Akamai Technologies AKAM has an Earnings ESP of +0.09% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Akamai Technologies’ shares have lost 18.2% in the trailing 12 months. AKAM is set to report its fourth-quarter 2024 results on Feb. 20.

AMETEK AME has an Earnings ESP of +0.54% and a Zacks Rank of 2 at present.

AMETEK shares have gained 12.1% in the trailing 12 months. AME is set to report its fourth-quarter 2024 results on Feb. 4.

DoorDash DASH has an Earnings ESP of +35.67% and a Zacks Rank of 2 at present.

DoorDash shares have surged 75.8% in the trailing 12 months. DASH is set to report its fourth-quarter 2024 results on Feb. 11.

Zacks Investment Research

Skyworks Solutions SWKS is slated to release first-quarter fiscal 2025 results on Feb. 05, 2025.

For the first quarter of fiscal 2025, non-GAAP diluted shares are expected to be $1.57 per share.

The Zacks Consensus Estimate for earnings has remained steady at $1.57 per share in the past 30 days. The projection indicates a 20.30% decline from that reported in the year-ago quarter.

Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.

Skyworks Solutions, Inc. Price and EPS Surprise

Skyworks Solutions, Inc. price-eps-surprise | Skyworks Solutions, Inc. Quote

For the first quarter of fiscal 2025, the company expects revenues between $1.05 billion and $1.08 billion, up 4% sequentially at the mid-point.

The Zacks Consensus Estimate for fiscal first-quarter revenues is pegged at $1.07 billion, indicating a 16.17% year-over-year decline.

Skyworks’ earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 1.24%.

Let’s see how things have shaped up prior to the announcement.

Factors Likely to Have Influenced Q1 Performance

SWKS’ first-quarter fiscal 2025 performance is likely to have benefited from its diversified portfolio, strong mobile demand, and growth in edge IoT and automotive sectors.

Skyworks anticipates a mid-single-digit sequential increase in mobile business revenues in the fiscal first quarter due to normalizing demand and supply conditions in the smartphone market.

The company also expects that 5G content in new smartphones, including the Google Pixel 8a, Samsung Galaxy M, and Oppo Reno12, will continue to contribute positively to revenues in the next quarter, particularly in the premium segment of the market.

SWKS expects modest sequential growth in broad markets, with a return to year-over-year growth. Specifically, there is strong demand in edge IoT, including Wi-Fi 7 systems, which is likely to lead to a multiyear upgrade cycle in the next quarter due to faster data transfer speeds and lower latency.

The rising adoption of generative AI and 5G technologies is expected to drive continued demand for high-performance RF solutions in the next quarter. Skyworks is positioned to benefit from the growing need for fast RF connectivity and power management in AI applications, next-generation smartphones, and autonomous vehicles.

Despite some inventory challenges, Skyworks sees long-term growth opportunities in its automotive business. The increasing focus on software-defined vehicles, connected cars, and in-cabin user experiences is expected to have been generating higher levels of radio complexity, creating demand for Skyworks’ advanced RF solutions.

However, challenges from excess inventory, supply chain issues, economic uncertainty, and delays in 5G and edge IoT adoption are expected to have hurt SWKS’ top-line growth.

What Our Model Says

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the exact case here.

Skyworks has an Earnings ESP of 0.00% and a Zacks Rank #3 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are some companies worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:

Bill Holdings BILL has an Earnings ESP of +29.71% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Bill Holdings’ shares have gained 25.1% in the trailing 12 months. BILL is set to report its second-quarter fiscal 2025 results on Feb. 6.

AMETEK AME has an Earnings ESP of +0.54% and a Zacks Rank of 2 at present.

Arista Network shares have gained 12.2% in the trailing 12 months. AME is set to report its fourth-quarter 2024 results on Feb. 4.

CyberArk Software CYBR has an Earnings ESP of +2.71% and a Zacks Rank of 3 at present.

CyberArk Software shares have surged 59.7% in the trailing 12 months. CYBR is set to report its fourth-quarter 2024 results on Feb. 13.

Zacks Investment Research

(16:01 GMT) Sirius XM Price Target Cut to $28.00/Share From $30.00 by Barrington Research

SiriusXM SIRI released its fourth-quarter and full-year 2024 results, presenting investors with a complex picture that merits careful analysis. The company reported fourth-quarter revenues of $2.19 billion, marking a 4% year-over-year decline, while net income rose to $287 million from $228 million in the prior-year period. Despite revenue headwinds, the company maintained a stable adjusted EBITDA margin of 31%, suggesting resilient operational efficiency in challenging conditions.

Subscriber Metrics and Revenue Pressure

The company's subscriber performance showed modest improvement in the fourth quarter, with the addition of approximately 149,000 self-pay subscribers, representing an increase of 18,000 compared with the fourth quarter of 2023. However, 2024 saw a net decline of 296,000 self-pay subscribers, albeit an improvement from the 445,000 decrease in 2023. The self-pay monthly churn rate improved to 1.5% in the fourth quarter, down 10 basis points year over year, indicating better customer retention despite competitive pressures.

Strategic Transformation and Cost Management

SiriusXM is navigating a complex market landscape with a strategic approach that suggests the potential for recovery in 2025, despite a 55.8% decline in the past year.

1-Year Performance

Under CEO Jennifer Witz's leadership, SiriusXM is implementing significant strategic changes focused on core strengths. The company is targeting an additional $200 million in run-rate savings by the end of 2025, building on approximately $350 million achieved in 2023-2024. This cost optimization initiative, combined with a renewed focus on the in-car subscription business and streaming capabilities, suggests a disciplined approach to maintaining profitability while investing in growth areas.

Technology Investments and Partnerships

The successful launch of SXM-9 and the establishment of a tech center in Ireland demonstrate SiriusXM's commitment to infrastructure improvement. Notable partnerships with Tesla and Rivian have expanded the company's reach in the growing EV market, potentially opening new growth avenues. These strategic moves indicate a forward-looking approach to maintaining market relevance and capturing new opportunities.

Guidance for 2025

Looking ahead, SiriusXM's 2025 guidance projects revenues of approximately $8.5 billion, adjusted EBITDA of $2.6 billion, and free cash flow of about $1.15 billion. While these figures suggest continued pressure on top-line growth, they also indicate management's focus on maintaining profitability and strong cash generation. The company's target of $1.5 billion in free cash flow by 2027 suggests confidence in long-term operational improvements.

The Zacks Consensus Estimate for 2025 revenues is pegged at $8.52 billion, indicating a 1.89% year-over-year decline. The Zacks Consensus Estimate for earnings is pegged at $3.05 per share, down 1.6% over the past 30 days.

Tesla to Spotify: SIRI's Rivals Spell Trouble

SiriusXM faces intense competition in an increasingly competitive and rapidly evolving audio entertainment landscape, raising concerns about its future viability.

SIRI's traditional stronghold — the automotive sector — is facing unprecedented disruption. The rise of electric vehicles and autonomous driving technology has opened the door for tech giants and innovative startups to challenge SiriusXM's once-unassailable position in in-car entertainment. Tesla TSLA, for instance, has been equipping its vehicles with its entertainment system, bypassing traditional satellite radio altogether.

The streaming audio market, once viewed as a complementary service to SiriusXM's core business, has now become an existential threat. Spotify SPOT, Apple AAPL Music and Amazon Music have continued to expand their user bases, offering personalized playlists, exclusive content and seamless integration across multiple devices.

While SiriusXM has invested heavily in podcast content and technology, it faces fierce competition from dedicated podcast platforms like Spotify and Apple Podcasts, as well as newcomers like Substack and Patreon, which offer creators more control and monetization options.

Investment Recommendation: Hold or Wait

Given the current landscape, investors might be better served by holding existing positions or waiting for a more attractive entry point in 2025. The company's strategic initiatives and cost optimization efforts, while promising, may take time to materially impact financial performance.

Supporting factors for this recommendation include the company's stable margins, improving churn metrics and strategic partnerships in the EV space. The focus on cost management and operational efficiency could drive improved profitability over time. Additionally, the company's strong free cash flow generation provides financial flexibility for strategic investments and shareholder returns.

The company's forward 12-month P/E ratio of 7.56X is significantly below the Zacks Broadcast Radio and Television industry's average of 28.39X.

SIRI’s P/E F12M Ratio Depicts Discounted Valuation

However, several challenges warrant caution. The ongoing revenue decline, continued pressure on subscriber growth, and competitive challenges in the streaming audio space create near-term uncertainty. The company's plans to implement changes to its streaming marketing strategy and subscriber acquisition approach in early 2025 could create temporary disruption before yielding benefits.

Key metrics to monitor in 2025 include the success of cost optimization initiatives, traction in EV partnerships, advertising revenue growth, and the impact of new pricing and packaging strategies. The first half of 2025 could be particularly challenging as the company implements these changes, but improvement may become visible in the latter half of the year.

The risk-reward profile currently appears balanced, with potential upside from successful execution of strategic initiatives, offset by near-term operational challenges and market uncertainties. Investors considering new positions might find more favorable entry points as the company demonstrates progress in stabilizing revenue and subscriber growth.

Conclusion

While SiriusXM's long-term prospects remain solid, the current transition period suggests a cautious approach is warranted. The combination of strategic initiatives, cost management efforts, and technology investments could create a stronger foundation for growth, but patience may be required before these efforts translate into improved financial performance. Investors should closely monitor the execution of strategic initiatives and watch for concrete signs of sustainable improvement before considering new investments. SiriusXM currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Zacks Investment Research