SiriusXM Holdings, the dominant provider of in-car audio subscriptions in the U.S., is shifting gears by doubling down on its core car-based subscribers while scaling back its streaming app ambitions. This strategic pivot was announced nearly a year after the company launched its streaming platform to attract younger audiences and diversify revenue streams.
According to Billboard, SiriusXM CEO Jennifer Witz outlined the new strategy in a statement on Tuesday, emphasizing the company’s commitment to its 33 million car-based subscribers, who account for 90% of its audience. “We are focusing on … our strong core subscriber base, our unique position in vehicle, and our unrivaled, curated content,” Witz said, acknowledging market headwinds affecting growth and profitability.
Why the Shift?
The streaming app, introduced in December 2023 with high-profile features such as channels by John Mayer, Kelly Clarkson, Shaggy, and Smokey Robinson, failed to meet expectations. Despite these efforts, SiriusXM has struggled to attract and retain streaming audiences, leading to high customer churn rates and softening subscriber revenue.
Instead, the company will now treat streaming as a companion service to its in-car subscriptions, available for an additional $9.99 monthly or bundled for $24.98. Partnerships with automakers like Tesla will remain central to integrating the service into vehicles.
As part of this pivot, SiriusXM named Wayne Thorsen as its new Chief Operating Officer. Thorsen, who brings experience from Google, Viacom, and ADT, will oversee product strategy and track returns on marketing and technology investments. He succeeds Joseph Inzerillo, who led the development of the streaming app and modernized SiriusXM’s technology infrastructure.
The pivot comes after years of heavy investment in technology, which contributed to layoffs of 650 employees across 2023 and 2024. The company has already saved $350 million through cost-cutting measures and aims to trim another $200 million in 2025.
SiriusXM’s challenges are reflected in its financials. During Q3 2024, subscriber revenue dipped to $1.645 billion from $1.729 billion in Q3 2023. Advertising revenue also softened, prompting a revision of the company’s 2024 revenue target to $8.675 billion from $8.75 billion.
The company added 14,000 self-pay subscribers in Q3, but this modest growth underscores the importance of bolstering its vehicle-based audience.
With a listening base of 150 million across SiriusXM, Pandora, and its podcast services, SiriusXM remains a significant player in audio entertainment. However, the company’s future hinges on retaining its car-based subscribers while navigating industry shifts toward digital streaming.
