SiriusXM is planning to reduce its headcount amid a slowdown in growth, according to a report.
On Thursday, financial news outlet Bloomberg said SiriusXM CEO Jennifer Witz informed staff at a town hall meeting that job reductions were possible in order to address economic uncertainty, including a long-term slowdown in sales.
A person familiar with the matter told Radio Ink on Thursday that potential job reductions were the result of a combination of factors, including a weakening advertisement market and issues in the automotive industry. If any layoffs take place, they would likely not occur until next year, the person said.
SiriusXM currently has nearly 5,600 employees, according to Bloomberg. That number appeared to include employees who work at the legacy satellite radio service, its datacasting divisions and its audio on-demand products Pandora and Stitcher.
It was not clear how many employees might be affected by job cuts, or which divisions might be impacted. A SiriusXM spokesperson told Radio Ink that the company had no comment and would not confirm reports of layoffs.
In the past, SiriusXM executives have affirmed that the company’s growth is largely tied to new and used vehicle sales. SiriusXM has partnerships with car manufacturers to install satellite radio tuners and other SiriusXM equipment in cars, trucks, sports utility vehicles and minivans.
During a recent interview with Axios, executives claimed there were 145 million vehicles on the road that have SiriusXM tuners installed. The company’s latest quarterly earnings report revealed 34.4 million customers were paying for SiriusXM service, and an analysis by The Desk found over 75 percent of cars with satellite radio tuners in them didn’t have an active subscription. (The author of this story is the publisher of The Desk.)
At an investor conference in September, Witz said the company would look toward building its streaming and digital audio products as the automotive industry continues to impact growth of its flagship satellite radio service.
“We are continuing to invest in, and I continue to think, [digital] is going to be a bigger portion of our subscriptions going forward,” Witz said. “It’s going to make us less reliant on the auto industry.”
Like other businesses, the automotive industry was hammered by the coronavirus pandemic. While new and used car sales increased, the amount of available inventory decreased due to global supply chain issues as workers in manufacturing plants were told to stay home at the peak of the health crisis.
Prior to the pandemic, SiriusXM said it wanted 80 percent of new cars on the road to be equipped with its SiriusXM 360L tuners by 2025. The hardware allows drivers to listen to satellite and streaming radio channels from a single device. In September, Witz admitted the company would miss that projection by a few years.