Pandora Media Inc (P)’s In-Car Installation Is No Danger to Sirius XM Radio Inc (SIRI): Apple Inc. (AAPL)

Performance

With a workforce nearly half of Sirius XM Radio Inc (NASDAQ:SIRI)’s, Pandora Media Inc (NYSE:P) is quite a small company compared to its rival. Nonetheless, based on revenue growth rates, Pandora’s 55% year-year-growth for the most recent quarter trumps Sirius XM’s 12%. However, the company’s operating loss of 10% for the trailing twelve months, compared to an operating profit margin of 26% for Sirius XM shows which company is yielding returns to its shareholders.

On the other hand, Apple Inc. (NASDAQ:AAPL)’s profit grew 11% year-over-year for the most recent quarter. The iTunes-internet radio service provider has an operating margin of 31%. Nonetheless, it would not be appropriate to judge Pandora Media Inc (NYSE:P) and Sirius XM Radio Inc (NASDAQ:SIRI)’s performance based on Apple. This is because the two radio service providers compete with a small fraction of Apple’s business.

The bottom line

I would like to think of Sirius XM Radio Inc (NASDAQ:SIRI)’s car radio service as Google’s Android platform for smartphones. Only that unlike Android, Sirius XM’s radio service is subscription-based. Nonetheless, the company’s market share in the business is as gigantic as any that you can think of, and seems set to remain that way in the near future.

Nonetheless, with Pandora now beginning build momentum in integrating its services in new cars, there would be an interesting battle between the pair, while Apple’s iTunes Radio remains a long-term prospect. However, for now, Sirius need not worry about Pandora, but concentrate on what it does best.

Nicholas Kitonyi has no position in any stocks mentioned. The Motley Fool recommends Apple and Pandora Media. The Motley Fool owns shares of Apple.

The article Pandora’s In-Car Installation Is No Danger to Sirius XM originally appeared on Fool.com.

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