XM Satellite Radio Holdings Inc. Announces First Quarter 2006 Results; Revenue Doubles Over Prior Year And Subscribers Grow To More Than 6.5 Million

Washington D.C., April 27, 2006 -- XM Satellite Radio Holdings Inc. (Nasdaq: XMSR) today reported financial and operating results for the first quarter ended March 31, 2006. For the first quarter 2006, XM recorded net subscriber additions of 568,902. XM finished the first quarter 2006 with a total of 6,501,859 subscribers, representing a 72 percent increase over the 3,770,264 subscribers at the end of the first quarter 2005.

“XM delivered solid results on key financial metrics during the first quarter,” said XM President and CEO Hugh Panero. “XM added more than 568,000 new subscribers at efficient subscriber acquisition cost levels. XM is positioned for continued strong growth in 2006 with our outstanding content and the introduction of five new radio models, including our revolutionary XM/MP3 players. With our first quarter subscriber growth, we remain on track to reach nine million subscribers and positive cash flow from operations by year end.”

The company recently priced an $800 million refinancing intended to replace higher interest rate debt with new lower interest rate debt, and is establishing a revolving credit facility with a group of blue-chip investment and commercial banks. These transactions are expected to lower XM’s ongoing interest rates, extend the maturity dates of the company’s debt portfolio, and provide lower cost standby liquidity through the bank revolver.

First Quarter Financial Results

For the first quarter 2006, XM reported revenue of $208 million, an increase of over 100 percent from the $103 million reported in first quarter 2005. The quarterly increase in revenue was driven by significant subscriber growth year over year, and increases in average revenue per subscriber in connection with our price increase implemented in the second quarter of 2005. For the first quarter of 2006, XM’s subscriber acquisition cost (SAC), a component of cost per gross addition (CPGA) was $62 compared to $89 in the fourth quarter of 2005 and $52 in the first quarter of 2005. CPGA was $94 compared to $141 in the fourth quarter of 2005 and $90 in the first quarter of 2005.

XM reported an EBITDA loss of ($83.5) million for the first quarter of 2006, including ($18.4) million in de-leveraging charges, ($12.1) million in stock based compensation expenses, equity in net loss of affiliates of ($8.9) million and other income of $4.6 million compared to an EBITDA loss of ($71.3) million for the first quarter of 2005 which included ($0.3) million in stock based compensation expenses, no de-leveraging charges or equity in net loss of affiliates and included $2.0 million in other income. XM’s net loss for the first quarter of 2006 was ($149.2) million compared to a net loss of ($119.9) million in the first quarter of 2005.

View XM Satellite Radio’s First Quarter 2006 Financial Earnings Highlights
(Adobe Acrobat .PDF Format)

XM Prices Refinancing Transactions

On April 21, XM priced $800 million of Senior Unsecured Notes. These transactions are scheduled to close on May 1, subject to customary closing conditions. The purpose of this refinancing is to leverage XM’s improving credit profile to transition to a largely unsecured capital structure while reducing interest rates, lowering the overall cost of capital, extending maturities and increasing financial flexibility.

The offering consisted of $600 million of Senior Unsecured Notes due 2014 with a coupon rate of 9.75 percent and $200 million of Senior Unsecured Floating Rate Notes due 2013 with a coupon of LIBOR plus 450 basis points. The net proceeds will be fully utilized to repurchase or redeem the company’s 14 percent Senior Secured Notes due 2009, the 12 percent Senior Secured Notes due 2010 and the Senior Secured Floating Rate Notes due 2009, and to eliminate $320 million in obligations to General Motors for $237 million. In addition to replacing these 12 and 14 percent notes, floating rate notes, and the GM obligations with sub-10 percent notes, we are establishing a $250 million secured revolving credit facility maturing in 2009 that is scheduled to close concurrent with or shortly after the Notes Offering. The new credit facility, combined with an increase in XM’s General Motors credit facility to $150 million, would provide the company with access to $400 million of available liquidity.

XM’s improved operational performance and new debt structure qualified XM to receive a notch rating upgrade to B3 and B- from Moody’s and S&P, respectively, for our proposed secured revolving credit facility.

XM Introduces Five New Radio Models in the Second Quarter, Including Portable XM/MP3 Players

In the second quarter of 2006, XM is introducing five new radio models, including next-generation portable XM/MP3 players. The Pioneer Inno and Samsung Helix are revolutionary, consumer-friendly devices that combine MP3 music and live satellite radio reception. The slim, portable radios receive live XM content on the go, and they provide the consumer with the flexibility of “time-shifted” playback of XM and MP3 content. Plus, these new radios allow the user to bookmark songs heard on XM for purchase from the XM+Napster web site. Two other new products, the portable Samsung NeXus25 and NeXus50 players, can store up to 25 and 50 hours of content, respectively. The NeXus players get live XM reception when connected to a docking station, and offer time-shifted listening and music purchase capability through XM+Napster.

In addition, the new XM AGT Sportscaster is now shipping to retailers. The Sportscaster is a compact plug-and-play satellite radio with special features for sports fans.

XM Syndicates “Opie & Anthony Show” on Terrestrial Radio

This week, XM announced an unprecedented agreement to broadcast XM’s hit “Opie & Anthony Show” on CBS Radio stations in seven major markets. CBS carries a three-hour portion of the “Opie & Anthony Show,” and XM follows the simulcast with an additional two hours of the program exclusive to XM. The full five-hour show airs live and uncut on XM and repeats during the day. This unique agreement provides CBS Radio with proven radio talent, while XM generates syndication revenues and gains valuable marketing and branding across seven CBS Radio stations that reach 40 percent of the U.S. population.

XM’s Second Season of Major League Baseball, New Channels, and Exclusive Sports and Music Programs to Drive XM Subscriber Growth

April: Sports highlights include the opening of Major League Baseball’s second season on XM with live broadcasts of every team, all season long, plus the Stanley Cup play-offs on XM’s NHL play-by-play channels, NBA play-off games on ESPN Radio and the first-ever satellite radio broadcast of The Masters golf tournament.

May: XM to complete expansion of new channel line-up to more than 170 channels, including the most commercial-free music channels in satellite radio, plus the premiere of Bob Dylan’s weekly, one-hour show on Deep Tracks (XM Channel 40) and live coverage of the 90th Indianapolis 500 (XM Channel 145).

June/July: XM to air the FIFA World Cup 2006 soccer tournament in English on the FIFA World Cup channel (XM Channel 148) and in Spanish on XM Deportivo (XM Channel 147), plus the British Open golf tournament on the PGA TOUR Network (XM Channel 146).

September: Oprah Winfrey and XM to launch the exclusive “Oprah & Friends” talk radio channel (XM Channel 156), and XM to broadcast the U.S. Open tennis tournament.

About XM Satellite Radio
XM (NASDAQ: XMSR) is America’s number one satellite radio company with more than 6.5 million subscribers. Broadcasting live daily from studios in Washington, DC, New York City, the Country Music Hall of Fame in Nashville, Toronto and Montreal, XM’s 2006 lineup includes more than 170 digital channels of choice from coast to coast: the most commercial-free music, premier sports, talk, comedy, children’s and entertainment programming; and the most advanced traffic and weather information.

XM, the leader in satellite-delivered entertainment and data services for the automobile market through partnerships with General Motors, Honda, Toyota, Hyundai, and Nissan is available in more than 130 different vehicle models for 2006. XM’s industry-leading products are available at consumer electronics retailers nationwide. For more information about XM hardware, programming and partnerships, please visit http://www.xmradio.com.

Factors that could cause actual results to differ materially from those in the forward-looking statements in this press release include demand for XM Satellite Radio’s service, the Company’s dependence on technology and third party vendors, its potential need for additional financing, as well as other risks described in XM Satellite Radio Holdings Inc.’s Form 10-K filed with the Securities and Exchange Commission on 03-03-06. Copies of the filing are available upon request from XM Radio’s Investor Relations Department.

Contact Information

Nathaniel Brown

XM Media Contact

XM Satellite Radio

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