Warren Buffett (Trades, Portfolio)'s Berkshire Hathaway (BRK.A, Financial) (BRK.B, Financial) just doubled down on SiriusXM (SIRI, Financial), scooping up 3.6 million more shares and pushing its stake to 32%. That's a big bet in a satellite radio company that's been struggling. After Berkshire's $87 million investment, SiriusXM's stock price is up 9%. However, this stock is still down over 50% this year, and the road ahead isn't exactly smooth.
SiriusXM has serious problems to tackle. They lost 100,000 self-pay subscribers in Q2 2024, and that's just part of the story. JPMorgan's Sebastiano Petti and other analysts are waving red flags, pointing to shrinking demographics and a halt on stock buybacks—two huge concerns that could crush long-term growth. The company is also dealing with a revenue dip, and their ability to hit $8.75 billion in annual revenue is looking shaky.
Buffett's move suggests he still believes in SiriusXM's staying power in the U.S. audio space, despite all the noise. SiriusXM and Pandora give them a stronghold in the market, but the question is whether they can pivot and regain momentum. The upcoming earnings report will be the moment of truth. Investors are watching closely to see if there's anything in the numbers that could reignite the stock and secure their spot in a shifting entertainment landscape.
