Warren Buffett Supports Sirius XM: Stock Price Gains Momentum Again

The shares of Sirius XM, the provider of satellite and online radio, recently recorded a remarkable increase of 8.7%, reaching a price of $27.10. This should please invested shareholders who were previously unsettled by the company’s negative price development — this year alone, the price fell by 51% and approximately 44% year-over-year. A possible reason for the sudden price growth could be found in Nebraska, with an influential investor named Warren Buffett, better known as the "Oracle of Omaha." His investment firm, Berkshire Hathaway, has further increased its stake in the New York media group and now holds a total of 32% of the shares. According to a filing with the SEC, the company purchased approximately 3.6 million shares worth about $87 million. Originally, Sirius XM emerged in 2008 through the merger of Sirius Satellite Radio and XM Satellite Radio and shortly thereafter faced significant financial difficulties. A loan of $530 million from Liberty Media helped avoid bankruptcy. By 2023, Liberty Media had established itself as a majority shareholder and owned 83% of Sirius XM through its tracking stocks. Berkshire Hathaway's recent increase in its stake coincided with the consolidation of Liberty SiriusXM with the other audio businesses, which took place as part of a reorganization plan by John Malone, the billionaire CEO of Liberty Media. The Atlanta Braves baseball team was also spun off into a separate publicly traded company, in which Berkshire also holds share rights. Following the conversion of Liberty SiriusXM shares into Sirius XM shares, shareholders received 0.8375 shares for each Liberty Sirius XM share held. On September 10, Sirius XM launched as a new, independent publicly traded company. The leadership team under CEO Jennifer Witz announced the company's realignment and future growth goals. For the second quarter of 2023, the company reported a loss of 100,000 self-paying subscribers, compared to 130,000 the previous year. According to CFO Tom Barry, this was mainly due to a decrease in voluntary churn. Additionally, Sirius XM recorded a revenue decline of 3% to $2.18 billion compared to the previous year. To solidify its market position, Sirius XM plans investments to enhance consumer and advertising experiences. Focus is placed on integrating popular content such as the podcast "Call Her Daddy," for which a $125 million contract was signed. Analysts and investors remain keen to see whether Sirius XM can withstand the pressure to consistently pursue its strategic goals.