Buffett Builds 37% Stake in Sirius XM as Shares Plunge 67%
In the last three years before his 2025 retirement, Warren Buffett’s Berkshire Hathaway amassed a 124.8-million-share stake in Sirius XM (37% of outstanding shares) even as the stock plunged ~67% since October 2022. Sirius XM reports 33 million subscribers, 76% subscription-based revenues, 20% from Pandora ads, and yields 5.3%.
1. Buffett’s Strategic Accumulation Highlights Long-Term Value
In the final two years of his tenure at Berkshire Hathaway, Warren Buffett amassed a 124.8 million-share position in Sirius XM, representing over 37% of the company’s outstanding stock. This accumulation occurred despite a broader market rally that lifted the S&P 500 nearly 70% from its 2022 lows, while Sirius XM shares declined roughly 67% over the same period. Buffett’s team identified the satellite-radio operator’s unique licensing framework and stable subscriber base as a reliable source of durable cash flows, especially in a rising-rate environment that placed pressure on companies with significant leverage. By year-end 2025, the equity stake reflected a conviction that Sirius XM was trading at a substantial discount to its intrinsic worth.
2. Subscriber Dynamics and Revenue Mix Support Predictable Cash Flow
At the close of 2025, Sirius XM reported 33 million subscribers, a 1% year-over-year decline that reflects headwinds from weaker auto sales and the competitive streaming landscape. However, the company’s revenue composition provides resilience: through the first nine months of 2025, 76% of net sales derived from subscription fees, while advertising on Pandora accounted for approximately 20%. This imbalance insulates Sirius XM from sharp downturns in ad spending during economic slowdowns, since subscription revenue tends to be more recurring and less elastic. Fixed transmission and equipment costs further bolster margin stability, ensuring incremental revenue from new or retained subscribers largely flows to the bottom line.
3. Robust Cash Generation and Shareholder Returns Create a Compelling Yield Profile
Sirius XM generated $715 million in free cash flow through the first three quarters of 2025, more than double its $274 million in dividend obligations over the same period, underpinning the safety of its annual payout of $1.08 per share. At a forward price-to-earnings multiple of just 6.6 times projected 2026 earnings, the stock offers a dividend yield of approximately 5.3%, which compares favorably to the broader market average. Management’s ongoing share-repurchase program further enhances per-share metrics and signals confidence in the company’s long-term cash-flow prospects. For income-focused investors, this combination of yield, valuation and operational predictability presents a clear case for consideration in 2026.