Sirius Satellite Radio Inc. added more subscribers in the third quarter than its rival, XM Satellite Radio Holdings Inc., but shares in both companies fell Wednesday on nagging concerns about whether rapid growth in the business can continue.
New York-based Sirius, whose lineup includes shock jock Howard Stern, continued to narrow the gap with the larger XM, reporting a net gain of 441,101 subscribers to reach 5.1 million. The company reaffirmed its target of reaching 6.3 million subscribers by the end of the year.
Washington-based XM said it gained 285,000 net new subscribers, bringing its base to 7.2 million. XM said that pace was consistent with its previously stated forecast of reaching 7.7 million to 8.2 million subscribers by the end of the year.
However, XM also said it would update those forecasts the next time it reported earnings. XM disappointed investors in May when it lowered its full-year forecast for subscriber growth, blaming softness in retail sales and problems with product availability.
Shares in XM and Sirius fell Wednesday in heavy trading. XM dropped 62 cents, or 4.9%, to $11.96, while Sirius' shares fell 13 cents, or 3.2%, to $3.94.