XM Narrows First Quarter Loss to $122 Million

Press Release - April 27, 2007

America’s leading satellite radio provider, XM Satellite Radio Holdings Inc., announced a reduced first-quarter loss yesterday, due to a healthy increase in subscription revenue.

Losses were narrowed to $122 million, or $0.40/share, compared to $149 million in the same three-month period a year earlier. Analysts had expected a loss of $0.41 per share.

XM’s quarterly revenue was up 27% from a year before, on strong subscriber growth, reaching a total of $264 million. The cost of finding new customers, however, jumped to $65 per paid subscription, from $59 in Q1/2006.

Churn rate, meanwhile, or the number of customers who drop the service, was steady at 1.8% for the third consecutive quarter.

In the coming year, XM is hoping to complete a merger with its largest rival, Sirius, so as to pool resources and increase efficiency. The deal is currently on hold, pending regulatory approval.