XM Satellite Radio Exceeds Wall Street's Expectations

XM Satellite Radio, America's most popular satellite radio service, ended the second quarter with more than 136,500 total subscribers — most from retail sales — exceeding most Wall Street projections. With XM's retail distribution rolling, General Motors is expanding factory installation of XM from the Cadillac DeVille and Seville to 23 additional GM models in the 2003 model year.

"With 136,500 subscribers, clearly the sale of XM radios and subscriptions through electronics retail stores have been terrific," said XM President and CEO Hugh Panero. "Our focus is now shifting to making XM part of the sale of GM vehicles as well. In preparation for availability at dealers beginning later this summer, XM is now being factory installed in 25 models of GM cars with an aggressive rollout plan encompassing household names such as Buick, Cadillac, Chevrolet, Oldsmobile, Pontiac and GMC, which represents yet another big step forward for XM."

"We in the sales and marketing group are excited about the quality sound and variety of programs that XM offers our customers," says Bill Lovejoy, GM Group Vice President North America Sales and Marketing. "GM is the first to offer XM on a wide array of 2003 models ranging from entry level to luxury to full-size SUVs. And we are working closely with our dealers via training and incentive programs to provide our customers an extraordinary entertainment experience in the comfort of their vehicles."

XM, already the fastest-growing consumer electronics audio product of the last 20 years, is poised to markedly increase its growth as General Motors continues to roll out XM-equipped models this year.

Exceeding most Wall Street expectations for the third consecutive quarter, XM announced a net gain of over 60,000 subscribers for the quarter, most from retail sales at Circuit City, Best Buy, Tweeter, and Radio Shack and other retailers nationwide.

XM remains on track to end the year with an anticipated 350,000 subscribers, Panero said,

"XM is transforming radio, an industry that has seen little technological change since FM, almost 40 years ago. XM's programming lineup features 100 coast-to-coast digital channels: 71 music channels, more than 30 of them commercial-free, from hip hop to opera, classical to country, bluegrass to blues; and 29 channels of sports, talk, children's and entertainment. XM also brings to the car, for the first time on radio, the same diverse selection of 24-hour news sources available in the home on cable and DIRECTV. XM was named 2001 Product of the Year by Fortune, an Invention of the Year by Time and won Popular Science's 2001 Best of What's New Grand Award in the electronics category. XM won several awards at the 2001 CES, including Best of CES in the automotive category.

In addition to GM, Isuzu dealers began offering XM radios to their customers in May. XM will be available as an option this coming fall on six Infiniti and Nissan 2003 models as well as future Audi and Volkswagen models. XM radios are available at major electronics retailers nationwide including Best Buy, Circuit City, Tweeter, Ultimate Electronics, participating RadioShack Dealers and Franchisees, Crutchfield, Good Guys, CarToys, Audio Express and Sound Advice; and at independent retailers. Leading manufacturers such as Sony, Alpine and Pioneer offer a broad array of XM radios that easily enable any existing car stereo system. XM's strategic investors include America's leading car, radio and satellite TV companies — General Motors, American Honda Motor Co. Inc., Clear Channel Communications and DIRECTV.