| | Existing Customer Forecast For Q3:
With QVC Q3 earnings coming up on November 5th, 2025 I wanted to provide my updated modeling for where I see QVC existing customers.
For Q2, my forecast for QVC existing customers was in the 3,732,221 - 3,797,691 range and they reported 3,720,000. I should note I am starting to see a big divergence in my M1 compared to actual when M1 prior had held up (QVC existing actual undershot by 77,691 of M1). I usually try to hold for three events to identify this as a trend, but given what my M1 is giving me for Q3 I have a sense this is moving towards some trend break and the model needing to be adjusted.
For Q3 I forecast QVC existing customers to be in the 3,671,762 - 3,776,128 range which would give us a (1.3) decline - 1.5% increase in existing. M2 has been holding as pretty accurate so likely we trend around that number (3,671,762 existing forecast)
Given QVC undershot both models it will be interesting to observe. The models have been holding up since Q1 2023 so despite what I read the math does support things.
I still track $SIRI since it's a Liberty spin and close to the family and I found this debt update in their recent 10-Q very interesting:
" On August 20, 2025, Sirius XM entered into an amendment to, among other things, increase the Credit Facility to $2,000 and extend its maturity to August 31, 2030. Sirius XM's obligations under the Credit Facility are guaranteed by certain of its material domestic subsidiaries, including Pandora and its subsidiaries, and by Sirius XM Inc. and are secured by a lien on substantially all of Sirius XM's assets and the assets of its material domestic subsidiaries. Borrowings bear interest at the Secured Overnight Financing Rate (“SOFR”) plus an applicable rate determined by Sirius XM’s debt to operating cash flow ratio, and we pay a variable commitment fee on unused commitments of 0.25% per annum as of September 30, 2025. The amendment also adds a springing maturity feature which will automatically accelerate the maturity date of the Credit Facility to a date 91 days prior to the stated maturity of certain of Sirius XM’s long-term debt instruments, including Sirius XM’s 2026, 2027, 2028, 2029 and 2030 Senior Notes and the Delayed Draw Incremental Term Loan, if at such date Sirius XM does not have sufficient liquidity to repay the maturing obligations. Liquidity for this test is defined as the sum of (i) unrestricted cash and cash equivalents and (ii) available borrowing capacity under the Credit Facility. "
$SIRI business is on bumpy ground but no where near QVC levels and these facility terms are pretty aggressive. Given QVC revolver is fully drawn I would then think these terms kill any idea of an LME for QVC. Again, an LME is used to buy time and the banks are the folks standing with the nearest maturity window and the single biggest group - using bank debt to take out corporate bonds doesn't seem to solve these problems when coupled with EBITDA erosion.
Let's see what earnings tell us in November.
Happy investing,
Sean |
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