This post was originally published on this site
Radio and streaming platform Sirius XM Holdings Inc. on Monday said it would lay off 8% of its workforce, or 475 positions, saying the move was necessary for the company’s long-term health amid a wobbly economy.
The cuts come after management, in November, said it would conduct a companywide review this year to find ways to save money. And they follow a broader pullback among advertisers and layoffs elsewhere in the tech and media industries.
Sirius XM shares
SIRI,
rose 1.4% on Monday.
Chief Executive Jennifer Witz, in a message to employees, said the move would affect nearly every department at the company after five years of growth and acquisitions.
“The investments we are making in the business this year, coupled with today’s uncertain economic environment, require us to think differently about how our organization is structured,” she said.
“We streamlined our non-headcount costs by reducing content and marketing spend, decreasing our real estate footprint, and most recently, implementing tighter restrictions in our Travel and Entertainment policy,” the message continued. “However, today’s decision to reduce our workforce was required in order for us to maintain a sustainably profitable company.”
Among other acquisitions, Sirius acquired the streaming service Pandora in 2019, and the podcasting platform Stitcher in 2020. Last year, it acquired Conan O’Brien’s media company Team Coco, which includes the podcast “Conan O’Brien Needs a Friend.”
Witz, in the message, said the company was providing severance, health benefits and other services.
During Sirius’s quarterly earnings call last month, Witz said Sirius closed out 2022 with record Ebitda — or earnings before interest, taxes, depreciation and amortization — and said it had added subscribers. Revenue hit record levels, according to FactSet data.
However, Witz noted “a challenging economic environment,” plans to boost investments in its technology infrastructure, and “substantial uncertainty” in the advertising market.
“As a result, we broadly anticipate a softer first half in terms of revenue, Ebitda and subscriber growth as compared to the back half of the year,” she said.
The company in January declared a quarterly cash dividend.
Shares of Sirius have slid 32.4% over the past 12 months. Over that period, the S&P 500 index
SPX,
has fallen around 3%.
