SiriusXM Holdings Inc. (NASDAQ:SIRI) reported second-quarter results on Thursday with revenue topping Wall Street estimates, although adjusted earnings missed expectations.

Following the results, the stock fell nearly 12%, reversing part of a sharp July run that had pushed the stock into overbought territory.

The audio entertainment company also raised its full-year 2026 financial guidance by $25 million across total revenue, adjusted EBITDA and free cash flow.

Revenue increased 1% year over year to $2.16 billion, beating the analyst consensus estimate of $2.136 billion. Adjusted earnings came in at 70 cents per share, missing the Street estimate of 79 cents. Net income rose 17% to $239 million, while diluted EPS increased from 57 cents to 70 cents.

Subscription And Advertising Drive Results

Subscriber revenue increased 1% to $1.64 billion, while advertising revenue rose 5% to $454 million. Equipment revenue declined to $36 million from $46 million a year earlier, reflecting higher memory costs associated with satellite radio hardware modules.

The SiriusXM segment generated revenue of $1.62 billion. Average revenue per user increased 1% to $15.32 following pricing actions earlier this year, while self-pay monthly churn improved to a record-low 1.4%.

The company added 22,000 self-pay subscribers during the quarter, its first positive second-quarter self-pay net additions in four years. Pandora and Off-Platform revenue rose 4% to $543 million, driven by advertising growth.

Profitability Improves

Higher subscription and advertising revenue, along with lower programming, legal and personnel-related costs, helped adjusted EBITDA increase 3% year over year to $691 million.

Free cash flow advanced 48% to $593 million, driven by EBITDA growth, lower cash taxes and favorable timing of capital expenditures and vendor payments.

Total cost of services improved 2% to $636 million, lifting gross profit 2% to $981 million and expanding gross margin by one percentage point to 61%.

SiriusXM Balance Sheet And Outlook

Cash and cash equivalents totaled $174 million at June 30, up from $94 million at Dec. 31, 2025. Total assets were $27.19 billion, while long-term debt increased to $9.45 billion from $8.65 billion at year-end.

SiriusXM now expects full-year 2026 revenue of about $8.525 billion, adjusted EBITDA of about $2.625 billion and free cash flow of about $1.375 billion.

The updated revenue outlook is above the company’s prior guidance of $8.5 billion but remains below the analyst consensus estimate of $8.569 billion.

SiriusXM Price Action

SIRI Price Action: SiriusXM Holdings shares were down 11.78% at $28.75 during premarket trading on Thursday, according to Benzinga Pro data.

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