Sirius XM Radio (SIRI 0.96%) fell short of Wall Street expectations this morning, but investors aren't panicking. The satellite radio-provider is still growing revenue and earnings at a double-digit percentage clip, and the future outlook continues to improve.

Revenue through the first three months of the year rose 12% to $897.4 million, fueled by a combination of a 9% increase in subscribers and a 2% pop in average revenue per user. Comprehensive net income climbed 15% to $123.4 million, but that boils down to flat earnings growth with a profit of $0.02 on a per-share basis. It isn't easy to move the needle when you have 6.6 billion fully diluted shares outstanding.

Analysts were holding out for net income of $0.03 a share on $906 million in revenue. Coming up short on both ends of the income statement is often a recipe for disaster, but Sirius XM's stock opened nicely higher this morning -- and rightfully so.

Sirius XM closed out the year with a record 24.4 million subscribers, and its raising its free cash flow guidance for all of 2013. The media giant now expects to generate $915 million in free cash flow this year, a welcome boost from its "approaching $900 million" call earlier this year.

Sirius XM also tapped interim CEO Jim Meyer as its permanent leader, a strong indication that Sirius XM's old guard is getting along just fine with majority stakeholder Liberty Media (FWONA)

The top dog in premium radio is also doing its part to tackle the gargantuan share count. Sirius XM began to act out on its $2 billion share buyback authorization, going through nearly a quarter of that to repurchase 157 million shares.

The fundamentals are generally holding up. Yes, monthly churn at 2% and a 44% conversion rate are at the unattractive ends of Sirius XM's historical retention and attraction ranges. This doesn't mean that Pandora (P) is finally eating at Sirius XM's business in this era of the connected car. There are clearly plenty of eardrums to go around to support growth for both platforms.

Sirius XM continues to grow at a reasonable pace, and that's not too shabby for a product that's only available in 22% of the cars on the road at the moment and activated in less than half of those.

Yes, Sirius XM did miss on the top and bottom lines today, but investors learn to forgive and forget when raised full-year guidance implies that the next three quarters will be just that much better.