XM Satellite Radio Holdings Inc., which is seeking regulatory approval for an acquisition by rival Sirius Satellite Radio Inc., on Tuesday reported a smaller second-quarter loss as it increased its subscriber base by 17 percent.
For the three months ended June 30, Washington-based XM posted a loss of $119.6 million, or 38 cents per share, compared with a loss of $175.7 million, or 57 cents per share, a year earlier.
Sales rose to $318 million from $277.3 million a year earlier.
Analysts, who typically exclude one-time items from their estimates, expected a loss of 41 cents per share and sales of $323.2 million, according to a survey by Thomson Financial.
XM shares rose 3 cents to end at $9.10 Tuesday.
XM Satellite said its adjusted operating loss was $37 million, compared with a loss of $47 million a year earlier.
XM added 322,000 new net subscribers in the second quarter for a total of nearly 9.7 million subscribers, up 17 percent from the same time a year ago.
Sirius most recently reported a subscriber base of 8.6 million, but has not yet released its second-quarter results. Though smaller, it has been adding subscribers at a faster rate.
During the quarter, average monthly churn, or the portion of the subscriber base that drops out every month, improved to 1.67 percent, compared with year-ago churn of 1.84 percent.
XM also increased its conversion rate _ the percentage of people who become paying customers after receiving a free trial subscription _ from 53.4 percent to 52.7 percent in the year-ago quarter.
For the first six months of the year, XM has lost $249 million, or 80 cents a share, compared with $298 million, or 97 cents a share, in the first six months of 2007.
Revenue in 2008 is up 16 percent, from $541 million to $626 million.
The company's purchase by Sirius still awaits approval by the Federal Communications Commission. Earlier this month, a commissioner who could be the deciding vote said he would support the deal if the companies agree to a six-year price cap after the merger and other conditions. The companies, which had previously offered a three-year price cap, have not commented on the commissioner's proposal.
The companies had hoped to close the deal seven months ago.
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