SiriusXM has announced a potential $1 billion impairment charge for Pandora, primarily due to increased royalty costs and the streaming platform's operating performance.

The announcement, made ahead of SiriusXM's Q4 2020 earnings call, triggered a decline in the company's stock (SIRI), dropping from $6.37 to $5.94 per share - its lowest since early January 2020.

Despite this setback, SiriusXM reported strong performance metrics:

• Added 900,000+ net self-pay subscribers, reaching 30.9 million total
• Expected to meet or exceed 2020 revenue guidance
• Projected 2021 targets: 800,000 new subscribers, $8.35 billion revenue, $1.6 billion free cash flow

Recent business developments include:

• $325 million acquisition of podcasting platform Stitcher
• Renewed contract with Howard Stern
• Expanded multiyear agreement with NBA for live audio broadcasts
• Exclusive audio broadcasting rights for 2021 Masters Tournament

New CEO Jennifer Witz remains optimistic about the company's future, stating "SiriusXM has a long runway of growth ahead of us in 2021 and beyond." The company continues to expand its content offerings through strategic partnerships while managing the challenges faced by its Pandora division.

The expected impairment charge highlights the ongoing challenges streaming platforms face with royalty cost structures, even as the broader company maintains growth in its core satellite radio business.

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