Greetings. Welcome to SiriusXM's fourth quarter 2022 financial and operating results conference call. This time, all participants are in listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero from your telephone keypad. Please note this conference is being recorded. At this time, I'll now turn the conference over to Hooper Stevens, Senior Vice President of Investor Relations and Finance. Mr. Stevens, you may now begin. Thank you. Good morning, everyone. Welcome to SiriusXM's fourth quarter and full year 2022 earnings conference call. Today, we'll have prepared remarks from Jennifer Witz, our Chief Executive Officer, and Sean Sullivan, our Chief Financial Officer. Scott Greenstein, our President and Chief Content Officer, will join Jennifer and Sean to take your questions. I would like to remind everyone that certain statements made during the call might be forward-looking statements as the term is defined in the Private Securities Litigation Reform Act of 1995. These all forward-looking statements are based upon management's current beliefs and expectations and necessarily depend upon assumptions, data, or methods that may be incorrect or imprecise. Such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially. For more information about those risks and uncertainties, please view SiriusXM's SEC filings and today's earnings release. We advise listeners to not rely unduly on forward-looking statements and disclaim any intent or obligation to update them. As we begin, I'd like to remind our listeners that today's call will include discussions about both actual results and adjusted results. All discussions of adjusted operating results exclude the effects of stock-based compensation. With that, I'll hand the call over to Jennifer. Thanks, Hooper. Good morning, everyone. Thank you for joining us. SiriusXM achieved strong 2022 subscriber and financial results, reaching record high EBITDA at more than $2.8 billion and revenue of $9 billion and delivering 348,000 self-pay net additions with a growing base of streaming subscribers. The business has proven resilient, and I'm pleased to report we met financial guidance set for the year. We made significant progress on our strategic growth objectives, including maintaining our dominant position in car, expanding streaming engagement, and continuing our leadership position in digital ad-supported audio. I'm also proud to share that we delivered record high ARPU and record low churn in 2022, a reflection of subscribers' high satisfaction with the premium listening experience we continue to evolve and enhance. Today, we announced new financial guidance that reflects continued strong operating performance and significant cash generation, even as we face a challenging economic environment and meaningfully step up investments in our technology infrastructure. Once again, we have endeavored to set financial guidance that takes into account our current view of the business and broader industry trends, particularly in the advertising market, where we see substantial uncertainty. As a result, we broadly anticipate a softer first half in terms of revenue, EBITDA, and subscriber growth as compared to the back half of the year. We are not issuing subscriber guidance at this time, although we anticipate we'll see modestly negative self-pay net adds for the year as economic and demand uncertainty persists, auto sales remain soft, and we moderate marketing spend for our streaming service early in the year ahead of planned product improvements late in 2023. During the Q4, SiriusXM's new and used car trial starts were down 3% and 7% sequentially as auto industry sales remain soft and vehicle prices remain at near record highs. Used car prices are now falling but remain at elevated levels. Affordability is further challenged by higher interest rates and the flow-through to payments. New and used car sales drive our primary trial funnels and are an important part of how we subsequently add self-pay subscribers. In 2022, auto sales were the lowest they have been in 11 years. For this year, analysts now expect new car sales to be up modestly by about 6%. Used car sales are expected to again fall slightly. We are closely monitoring consumer health. While we've seen signs of slowing inflation in the last month, we are watching personal savings rates, consumer confidence, auto loan defaults, and the other key metrics to monitor the strength of the American consumer and how that could impact our business in areas like non-pay churn and general subscription demand. The advertising market continues to face headwinds, with economic and business uncertainties causing many major advertisers to be cautious in their marketing spend. We began to see this shift in the back half of 2022 and are continuing to feel its impact early in 2023. Podcasting is not immune to these forces but does remain a bright spot for the business, which I'll speak to in a few minutes. Given these macro factors, we are focused on increasing productivity and effectiveness as we realign resources to invest in growth opportunities for the business. This means building a culture that's more agile as we focus efforts this year on developing an updated SiriusXM streaming experience, which we expect to launch in the fourth quarter. As you heard me talk about on our prior earnings call, we have implemented measures to control our discretionary spending, and we will remain disciplined and look even more broadly for cost savings in every area of our business. To give just one example, we began to reduce marketing spend last quarter and will continue to reduce spend for most of this year as we moderate ahead of the expected relaunch of our streaming experience in the fourth quarter. While this is the right decision for our business, we expect this more conservative approach to marketing spend in the first half to contribute to lower net subscriber additions near term. We all know that consumers now have more options than ever when it comes to listening to content in the car and on the go. Today, we hold the largest share of ear in the car outside of combined terrestrial radio, and as we look to attract new audiences to our platform, we are becoming more and more agnostic, not just how they come in the front door, but also how they choose to interact with our service. Our updated SiriusXM experiences on CarPlay and Android Auto that launched late last year reflect our commitment to make it easier and better for new audiences to use this way of listening in-car should they choose. In the year ahead, we will continue to evolve our business by leaning into our in-car advantage and modernizing the SiriusXM technology platform, delivering an improved streaming experience with the relaunch of our SXM app. Our in-car evolution should be viewed in parallel with how autos have evolved over the years, going from push buttons and dials to massive touchscreens and multiple entertainment zones. Car entertainment systems look radically different than they did just a few years ago, and we are committed to our own radical evolution with future-focused consumer-first in-car experiences. Fully utilizing Lucid's massive touchscreen interface with our beta launch last quarter is a prime example of how we are working with automotive companies to evolve and enhance the SiriusXM experience. We look forward to the broader rollout with Lucid later this year and are continuing to innovate with a variety of other automakers as well. Our state-of-the-art 360L platform is quickly becoming the new standard for SiriusXM and is now available in 20 OEM brands with the additions of Jaguar, Land Rover, Lamborghini, and Nissan vehicles in 2022. We finished the year with over 7 million 360L-enabled cars on the road, and the percentage of new SiriusXM-enabled vehicles with 360L increased to 27% in 2022, a number that should meaningfully rise this year as we expand into several additional automotive brands. Our total new and used vehicle penetration rates were 83% and 53% respectively, and our enabled fleet stands at over 150 million vehicles. Last quarter, I shared the progress we made personalizing the 360L experience in select vehicles, including the introduction of data-driven music and talk recommendations on four-view screens. I'm happy to report a continued double-digit lift in engagement. Our goal is to seamlessly tie together the in-car and out-of-car SiriusXM experience to better serve our listeners, getting them content they want to hear faster, no matter where they are listening. We are also seeing improved conversion in 360L tied directly to consumers using these enhanced features, including the ability to create personalized Pandora stations and access to more on-demand programming and extra channels. At SiriusXM, our premium live curated programming sets us apart in audio entertainment and creates habitual listening. While most listening remains live across all subscriber audiences, we are seeing interesting trends on the type of content our different subscriber cohorts engage with. For example, streaming-only subscribers who are generally younger and more diverse than our in-car subscribers gravitate towards our original streaming content with high interest in our music shows available on demand and our extra channels. We are also seeing this group stream non-music content at a higher rate than in-car subscribers who stream, and we see higher retention with both groups when they engage with non-music content. As part of our efforts to go deeper here, in 2022, we expanded our relationship with the NFL to make SiriusXM the exclusive third-party home to all NFL games. Recently, we agreed to a multiyear extension with the NHL that will see SiriusXM continue to deliver to fans access to every NHL game throughout the regular season and Stanley Cup playoffs. In fact, sports programming hit a 3-year record high in listener reach in 2022. This past November, as part of our extension agreement with Andy Cohen, we expanded Radio Andy into the official destination home for all things pop culture by moving content like Tin's shows over to the channel. The Q4 also saw launches of several new tentpole and pop-up channels, including the launch of our latest 24/7 original comedy channel, Team Coco Radio, which is executive produced by Conan O'Brien and features exclusive audio content. We also went live with the Selena Gomez radio channel and launched a streaming-only full-time channel with country music superstar Eric Church. Although we will remain disciplined in our content spend this year, you will see us continuing to pursue opportunities to create more original on-demand content to complement our linear offering with more streaming-first talk, music, and video content as we look to continue to attract and convert younger, more diverse audiences. As always, we continue to use the power of our platform to spotlight important moments, and this month, we celebrate Black History Month on Pandora and SiriusXM with specialty programming across music, comedy, talk, and sports. This includes the launch of the Apollo Theater Channel, a limited run and channel that will spotlight SiriusXM's Apollo shows, as well as music and stories from many of the amazing artists who've performed at the historic theater. Coming off of 2 incredible nights with Drake at the Apollo, which will air exclusively on his SiriusXM channel, Sound 42, in the near future, we are excited to bring our ongoing relationship with the Apollo to life in new ways for our listeners to enjoy. In a challenging ad market, podcasts continue to be a growth opportunity for us. This past quarter, we expanded our podcast offerings while doubling down on the shows that have proven most successful. With 5 of the top 20 shows in Edison Research's top 50 podcast rankings, the most of any network with Crime Junkie, Office Ladies, Dateline NBC, Pod Save America, and Conan O'Brien Needs a Friend, we feel very good about our current podcast slate and will continue to be purposeful in how and when we invest in programming to best align with our business priorities. Q4 and full year total advertising revenue were essentially flat year-over-year, with Q4 down 3% and full year up 2% respectively. Podcasts continue to be a bright spot for the industry overall and us in particular, driving a 34% increase in 2022 in our off-platform business, which includes podcasting. In particular, our audience-based podcast products, including Podcast Everywhere and Podcast Select, as well as programmatic podcasts, are up 153% year-over-year. This part of our offering provides greater efficiency through automation, which is still nascent in podcasting, making it a fantastic opportunity for us as we continue to grow this area of our business. As we enter 2023, we continue to face the same headwinds that began in the second half of 2022. However, we remain confident in our ability to monetize our ad-supported portfolio and offer brands effective and innovative ways to reach their target customers in audio. In closing, I'm pleased with our strong operating and financial performance in 2022. The business continues to prove resilient. Our high-quality business model continues to produce some of the best margins in media. While we anticipate softness in the year ahead, we are redoubling our efforts to invest in our products, enhance the SiriusXM experience for our customers, and ensure we are well-positioned in an ever-evolving audio entertainment landscape. With that, I will turn it over to Sean. Thank you, Jennifer. Good morning, everyone. As Jennifer noted, we closed last year with strong financial and subscriber results, meeting all of our guidance, a real accomplishment in a tough year. In 2022, total revenue increased 4% from $8.7 billion to $9 billion, led by subscription revenue growth and modestly higher ad revenue. Although ad revenue did begin to soften later in the year. Adjusted EBITDA grew 2% from $2.77 billion to $2.83 billion. Free cash flow came in at $1.55 billion as cash taxes climbed by $157 million in 2022. Recall, 2021 had benefited from a one-time satellite insurance recovery. During the fourth quarter, revenue remained roughly flat at $2.28 billion, with subscription revenue climbing while advertising revenue declined 3% to $480 million. Adjusted EBITDA during the quarter climbed 10% to $742 million as we began to see benefits from cost reductions. Net income for the quarter rose 15% to $365 million or $0.09 per diluted share, and free cash flow reached $529 million, up 10% from the same period last year. Looking at our operating segments, at SiriusXM, total revenue climbed 4.2% to $6.9 billion in 2022, boosted by 6% ARPU growth, partially offset by reduced revenue from a smaller base of paid promotional subscribers. Gross profit in the SiriusXM segment grew to nearly $4.3 billion, up 6%, and produced a margin of 62%, up a point from 2021. We added 348,000 self-pay subscribers for the year and 162,000 during the fourth quarter. In the Pandora and Off-Platform segment, we generated $2.1 billion of total revenue, up 1% over 2021, with a 2% increase in the segment's advertising revenue. MAUs declined by 9% in 2022 to 47.6 million, while average hours per ad-supported active user climbed 4% to 20.6 hours per month. Gross profit in the Pandora and Off-Platform segment was $655 million, down 12%, representing a gross margin of 31%. This decline in gross profit was driven by our investments in podcasting, a corner of the audio entertainment market that we expect will yield greater monetization opportunities over time as the business evolves. At a high level, our non-Pandora ad revenue across the business climbed 24% in 2022 to $672 million, representing 38% of our total ad business in 2022, compared to 31% of our ad business in 2021, with podcasting revenue driving most of this growth. Turning to capital allocation, in 2022, we returned approximately $2 billion to stockholders, with approximately $1 billion via special dividend in February, $350 million in recurring dividends, up 31% from 2021, and $639 million in share repurchases. We slowed share repurchases throughout the year, in particular in late 2022, to prudently maintain leverage within our target range in the low to mid threes, ending the year at 3.3 times net debt to EBITDA. We expect to continue a conservative stance on capital returns in 2023, given the macro backdrop, particularly in the first half of the year. Our balance sheet is extremely well-positioned. It gives us tremendous flexibility. This morning, we issued 2023 guidance that anticipates approximately $9 billion of revenue, adjusted EBITDA of approximately $2.7 billion, and free cash flow of approximately $1.05 billion. As Jennifer mentioned, we are not providing subscriber guidance today. We do expect to deliver modestly negative self-pay net subscriber ads for the year. Our more cautious approach to spending on subscriber growth will keep our business focused on profitable, rational outcomes from prudent marketing and investment decisions, which we continuously reevaluate throughout the year. We are beginning to see the benefits from cost efforts started last year in reducing our real estate footprint and reduced hiring. This year, we expect to implement broader cost reductions across every element of our business with an eye on making all of our work processes more efficient. Currently, we expect the results in the second half of 2023 will outpace results in the first half of the year. Given the soft ad market entering 2023 and our plans to increase marketing spending later in the year on streaming, we expect year-over-year trends in subscriber growth and EBITDA to be more favorable in the back half of 2023 than in the first half, with declines in self-pay subscribers and EBITDA sharpest in the first quarter and then moderating to reversing later in the year. Similarly, because of the normal seasonality of our business in terms of receipts versus expenditures, combined with the timing of capital expenditures, we would expect a meaningful portion of 2023's free cash flow to come late in the year. Our 2023 guidance also incorporates nearly $100 million of increased music royalties as a result of the expiration of agreements relating to pre-1972 music rights and the 9% CPI inflator that the Copyright Royalty Board announced for webcasting performance rights. This year, we expect satellite CapEx to rise by just over $200 million as production for the recently announced SXM-11 and -12 satellites begin to ramp. The production of these satellites will run concurrent with the multi-year builds of SXM-9 and -10 already in the development pipeline. SXM-11 and -12 represent our commitment to maintaining premium services, improving our service area and quality, and providing options to create new revenue streams in the Sirius low-band over the long term. Non-sat CapEx will also modestly increase with other strategic long-term investments in product engineering and IT as we re-platform our commerce and identity systems to reduce consumer friction in using and subscribing to our products, and as we push forward advances in our consumer-facing in-car and streaming services. Finally, also incorporated into our free cash flow guidance, a further roughly $170 million increase to our cash taxes this year. As we look from 2022 to 2023, we're seeing a step up to essentially full cash taxes. On the CapEx side, it's important to remember that 2023 essentially begins an investment bubble with several satellites under construction at once, combined with a re-architecting of some of our foundational commerce, identity, and technology stacks. You won't see these negative deltas in future years on cash taxes and CapEx. In fact, satellite CapEx will begin to moderate late in 2024 before exiting 2027 near zero and staying there for many years. With these investments, we'll be ensuring more robust consumer-facing products delivered with lower friction and continued long-term service continuity and optionality with our broadcast network in the years to come. I'm proud of the strong finish in 2022 and our team's hard work to set us up for success in 2023 and beyond. With that, I'll turn it over to the operator for Q&A. Thank you. We'll now be conducting the question and answer session. If you'd like to ask a question today, please press star one from your telephone keypad and a confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions. Thank you. Our first question will be coming from the line of Gokul Hariharan with RBC Capital Markets. Please proceed with your questions. Good morning, thanks for taking questions. I wanted to ask about SiriusXM self-pay net adds. Results were pretty solid in the quarter, I think the expectations for modest declines in 23 are perhaps not too surprising. I know visibility remains low, this might be a bit unfair to ask in this environment, you know, how do you think about the path to getting closer to more historical levels of annual net adds, or at least getting back to positive net adds? I think we're all aware of the headwinds, you know, you have a lot of positives going on, too, in terms of the content slate. The in-vehicle experience is only getting better. You continue to lean on streaming, I think you're being a little bit more targeted with certain consumer segments as well. You know, I know you're not going to guide to net adds for next year today, but maybe you could talk a little bit about your confidence level in, you know, getting closer to step function improvement in 2024. Sean, if I could ask on free cash flow. Thanks for bridging, you know, the path from 2022 to 2023. As we think about 2024, you know, a lot of the items that you called out, in terms of cash taxes and CapEx, you know, I know CapEx, we're kind of in a bubble right now, but it doesn't seem like that's gonna go away next year necessarily. You know, is this a more appropriate level of free cash flow on an annualized basis for the next few years? Thank you. Thank you, Gokul, for the questions. I'll start on subs and Sean can take free cash flow. In 22, you know, clearly the dynamics were somewhat similar to what we think, you know, we're gonna see going into 23. Auto sales in 22 on new and used were both really at about 10-year lows, with used coming down 10% off of, you know, record high in 2021. You know, that really impacted our automotive funnel going into and throughout 2022. On the streaming side, you know, we saw, you know, really nice results in driving trials and getting people into our streaming experience. You know, we are being more cautious as we continue to approach this in 23 because the churn profile of our streaming subs is very different than our in-car subs. You know, we've talked a little bit before earlier on the call about the investments we're gonna make in our technology infrastructure to improve our capabilities that will help us focus on retention there. Just, you know, turning to 2023 and subs on general, I'd say, you know, our expectations for the automotive funnel, look, you know, pretty similar to last year. I would think that our trial starts for the first nine months of the year, which are obviously the important ones to drive self-pay net adds. Across new and used will actually be pretty flat in the first nine months of this year relative to the first nine months of last year. You know, as we look at the third-party estimates for SAAR for this year, you know, it's a, it's a similar dynamic as to what we thought was gonna happen last year, where it's very back-half weighted. In fact, you know, most of the estimates would have us returning to something like 16 million in the fourth quarter. We're really not seeing, you know, the ramp up too much prior to then. On, you know, streaming, again, I think we're gonna be cautious on where we spend there until we get, you know, more product improvements in the market. On churn, you know, look, I am very pleased with where we are on churn and our performance. You know, if you just look at fourth quarter, we were down, I think, 20 basis points year-over-year. That was across all areas of churn. Non-pay, voluntary, and vehicle-related. Of course, as auto sales increase, we would expect to see some, you know, churn increase there from vehicle-related. You know, we still are cautious about the dynamics in the economic environment and how that might play out in non-pay and voluntary churn as it relates to cancel demand. Just on, you know, we made a couple of comments related to demand in the call or in the comments earlier. I'd say that really is related to 2 areas. We have, you know, conversion rates on our first-time trialers who tend to be younger and less affluent, and our win back efforts, much, you know, more impacted by, you know, these price-sensitive segments of our, of our funnel. We're just, you know, being cautious as we see how those dynamics play out this year. You know, this year I would expect our conversion rates on the new car side to be in just sort of the low 30s and on the used car side in the low 20s. Those are some of the dynamics that set us up for this year. You know, we're certainly hopeful as we get through this year, we get a new product in market. We have the benefits that, you know, you actually highlighted, in terms of content and our product experience. And we start to see a recovery in auto sales that, you know, things look a little different as we go into 2024. Sean on- Yeah. Quick on the free cash flow point, again, in my script I tried to bridge. You know, I think CapEx, to start there, probably a high point here in 2023. Again, we're in a huge cycle with the satellites. As I said, roughly $200 million increase. We talked about the investments we're making in some of the core platforms around identity and commerce. That is creating some incremental spend in 2023 as well. You know, taxes, I guess we're getting to, you know, with the full utilization and some of the sunsetting of R&D, for example, we're getting to a more effective cash tax, given the utilization of most of our tax attributes at this point. Again, as you look through in the future, I'm not gonna guide to 2024, 2025, and beyond, clearly, our expectation is this free cash flow is a low point, and as we get through this bubble, we'll start to see real positive benefits relative to where we're gonna be in 2023 and where we guided. I'll leave it at that. Thank you. That's great. Thank you both for all the color. Thank you. Our next question comes from the line of Benjamin Swinburne with Morgan Stanley. Please proceed with your question. Thanks. Good morning. Just one clarification. Does your self-pay churn number include churn related to your streaming-only subscribers? I was curious if Jennifer, if you could talk a little bit about kind of the economic sensitivity in the business in your subscriber base today relative to prior cycles. I tend to think of your customer base as skewing a bit more higher income, which may be wrong, especially with all the success you've had in used cars over the years. Obviously, this interest rate environment is just different than we've had in really a long time. Would be helpful to hear how you're thinking about those puts and takes heading into 2023. I think Scott's on the call, I believe. I was just wondering, having now spent some time, you know, selling into the podcast, selling podcast advertising for a few years and scaling that business up. Can you talk a little bit about the opportunity in podcast advertising when you think about the budgets you may be going after? Is this a radio, broadcast radio opportunity? Is it a digital opportunity, direct response brand? Just help us think about where this could go in a 3-5 year view. Thanks so much. Okay. Thanks, Benjamin. Your first question about self-pay churn. What we report is in-car or satellite only. You know, the streaming subs still aren't a material part of our subscriber base, and we tend to look at those on a, you know, net ad basis. The churn profile, as I mentioned earlier, is higher on our streaming subs relative to our satellite subs. In terms of economic sensitivity, you know, I'd say the last cycle was just so different for us as we were building penetration rates, and we were so much earlier in our maturity. It is tough to provide, you know, comparisons to that. I do believe our subscriber base is, you know, largely more affluent. You know, our headline price is $17.99 for our, you know, most popular package, we attract, you know, a more affluent consumer base for sure. We have expanded that, as you note, with our increased penetration in used cars, that was, you know, really nascent, you know, years ago when we faced this last, you know, sort of cycle. You know, I guess I would also say our churn dynamics, again, continue to remain impressive over, you know, the last 18 months to 2 years. You know, the fourth quarter was the lowest fourth quarter we've ever had, with just above 1.5%. I think that sets us up really well, going into this cycle, no matter how it actually evolves. Scott, do you wanna start on podcasting and I can add on? Sure. Sure. First, you know, the podcasting has some similarities to the early growth of SiriusXM. We had to get to a place when we acquired Stitcher and then built it with deals to get luckily to number 1 network, and we have 5 of the top 20. However, you know, no different than those early Sirius and XM bidding wars, the economics on podcasting got a little out of hand, to say the least. As you can see, the pullback is going on right now. Yet, it's a robust source in some ways uniquely for us. To get to the point on the advertising, you know, we look at it as whether you look at Team Coco or Crooked or a few others, where it's gonna be a combined audio sell, ultimately of radio, at Sirius, podcasting through Stitcher. Also podcasting has a nascent but growing event business, merchandise business and all of that. So it's gonna have to find, you know, its sea legs, in general. With us, we feel pretty good. We're gonna be selective, obviously. You know, we're gonna be very, very disciplined, especially given where we are right now in our slate, on the economic model. I'm confident, advertising gaps of demos and uniqueness in what podcasts cover will certainly allow advertisers windows in that don't exist anywhere else, and in some cases don't exist at Sirius, that the podcasting market services that. I feel pretty good that when advertising picks up and it gets a little more micro-focused, there's gonna be unique assets, certainly what we'll have, and then the combination of overlaying our whole service, you know, with all three brands, with Pandora also. I feel pretty good where it'll go once it goes back, hopefully to normal. Yeah. I'd just add that, yeah, I do believe we have a great network of podcasts, as Scott highlighted. You know, we represent major networks and across the top three categories, so news and comedy and true crime. This, you know, the cross-selling that Scott highlighted is, you know, really unique opportunity that we can provide across, you know, live broadcasts, music streaming on and off platform, and podcasts as well as marketplace and tech feeds. We're really well positioned here. There are a number of podcast products that we launched last year, Podcast Everywhere, Podcast Select, and some, you know, programmatic capabilities. You know, the Podcast Everywhere and Select are, you know, still direct sales enabled, but allow a lot more targeting on an audience basis, but also with content filtering and, you know, leveraging our predictive audiences tools to provide, you know, better insights as to where the listeners are in terms of life stage or purchase consideration and others. You'll see us do more and more here going forward. This is just, you know, Scott said it's nascent. There are a lot of investments needed, I think, across the industry to provide better tech solutions for advertisers, and we're just getting started. I would expect the monetization to continue to improve. Thank you very much. Our next question is from the line of Steven Cahall with Wells Fargo. Please proceed with your questions. Thanks. Good morning. Maybe just first, Jennifer Witz, I think you said conversion expectations for the year is low 30s on new, and low 20s on used. If my memory serves me correctly, that's a little below where you've been historically. I was wondering if you could just talk about, is that some expected, you know, just consumer weakness on the economy? Is that the new mix that you have, due to some of the higher penetration you have in inventory? Just love to get your latest thoughts on conversion rates. Then on the streaming launch that you talk about, can you provide any more detail about what sort of new functionality or features are gonna be in this? Will this be a combined product between Pandora and SiriusXM, or is this really a revamp of the SiriusXM one? I got a quick follow-up for Sean. Okay. Thanks, Steven. On the conversion rate side, you know, I guess I'd start by saying that over the long term, we've really focused on optimizing our yield, which is really the net of both penetration rates and conversion rates across both new and used. You know, while we've done this, we've also materially reduced our investment per new car, per new enabled vehicle, you know, with our SAC per install, you know, down, you know, something like 70% over the last 10 years or so. Of course, as you look at these metrics separately, pen rates have risen, overall conversion rates have declined as we have entered lower end trends and models purchased by younger and less affluent buyers. That's, you know, where we are today in terms of the rates that we're expecting for this year. We've seen, you know, these lower conversion rates materialize among younger audiences be in part because they're looking for more personalization and more control over their listening experiences, and this is why we've been building out our 360L capabilities and investing in our apps. Where we can provide a significantly better and customized listener experience. Of course, I would love the 360L rollouts to move faster. We are subject to the typical automotive product cycles, but we continue to see increases every quarter in our 360L pen rates. You know, we know through our research surveys and data coming back that one of the most impactful features of 360L is actually just the recommendations. These help guide listeners into our nonlinear content. We absolutely see higher conversion rates when listeners engage with this content, especially those who are, you know, newer to our service and may find it more challenging to navigate in terms of our in-car integrations. We are also expecting to, you know, really address some of this with our streaming product enhancements, which will come later this year. You know, we will have more to say about that in the coming calls. There are sort of two aspects. We are fundamentally changing the underlying technology architecture to enable better commerce, better identity, and better MarTech capabilities. We will also layer on top a brand new consumer-facing experience with enhanced search recommendations and other features. I think that what we wanna do here is be agnostic as to how listeners may want to experience our service, whether it is in the car through CarPlay and Android Auto applications, whether it's outside of the car or using our integrated experiences. Everything we do on the streaming experience will ultimately benefit 360, 360L as well. Then I think I addressed a bit of your streaming watch question. Today it is SiriusXM only. That is the focus for the 4th quarter in improving that product experience. Sean, I guess you have... Yeah, Steven, you had a follow-up? Yeah. For Sean, you talked about a more conservative stance on capital returns. I think the buyback in Q4 was certainly more conservative. I'm just wondering if you would intend to run leverage a little lower in 2023, given some of the cash items affecting free cash flow that you talked about. As you can surmise, I'm just trying to kind of back into what kind of buyback we might expect for 23 and exactly within that kind of conservative stance statement. Thanks a lot. Yeah, no problem. Again, exited at 3.3x. I think we'll continue to operate in that range. I think in my comments, Steven, we talked about the first half of the year, and that's not only a comment about the macro environment we're operating in and the uncertainty that exists, and not only in the overall economic environment, but with consumers and the advertising market, specifically. I think a cautious approach in the first half of the year, and then I think, as we always do every quarter, we'll reevaluate and assess as we get into the year and see how business performance is, how the macro environment is. Again, as you know, we've got a number of levers that we've utilized in the past. We've got a great balance sheet, and, you know, we'll be opportunistic in terms of how we utilize our capital return opportunity. Not much more to say. Great. Thank you. Thanks. Thank you. The next question comes from the line of Jessica Reif Ehrlich with Bank of America. Please proceed with your question. Okay. Thank you. I have an advertising question and then some content questions. On advertising in first quarter, you sound very cautious. Could you give any specificity on what you're seeing, what you're actually seeing in the first quarter, and how much visibility do you have beyond the first quarter? Can you give us any color on your demographics? Who do you compete with in advertising? Is it just audio? Then I'll give my content questions after. Yeah. Jessica, this is Sean. I'll start. I think that, you know, we are seeing a choppy marketplace, not dissimilar to how we exited Q4, in the month of January. You know, obviously the competitive landscape over the last week or so has reinforced that as others have reported and provided their outlook. I do think that, you know, podcasts, as we just talked about, continues to be a bright spot. I think we've got a fair amount of inventory, and we have people that are interested in putting dollars there. You know, in the context of a difficult market, I think that continues to provide some benefit to us. You know, I think there are certain categories that are strong, you know, in terms of consumer goods and, you know, autos and some food service companies. You know, we're pleased. I mean, we've got obviously a unified sales force that's selling multi-platform, a good mix of brand and direct-to-consumer advertising. You know, the visibility is probably less than it used to be historically. I think people are putting their dollars to work closer to the time that the ads are run. That does create some challenge in terms of predictability. I think Sean largely addressed this, but we're facing competition, growing competition from other streaming, digital streaming audio companies that are coming into the market more aggressive. Of course, you know, the dominant player being AM/FM, and I think there's been some pricing pressure as a result. You know, we built the digital audio market on the music side with Pandora, and we have a lot of great relationships, as Sean said, across brands there and on the, you know, satellite side, while the number is smaller, we have a lot of great relationships on the DR side, and podcasting is a mix of that. I also think we bring some really unique selling propositions relative to the competition in terms of, you know, the cross-platform selling, like we talked about, you know, the broad relationships with advertisers. The fact that the podcasts we represent are distributed broadly across all listening platforms. You know, we've done a number of really unique custom integrations which advertisers love. You know, it's a high touch sales process, but, you know, it really gives advertisers a connection with listeners like, you know, what Conan did with his Clueless Gamer sponsorship with Samsung and promoting their gaming hub. The live events we do that, you know, Scott touched on earlier. We've got a lot of great examples of that, and I would expect those to be important for our business this year. I know you had something else for Scott. Yeah. Actually one of the questions is on live events. You know, can you talk about the impact on your overall business from doing these? You had some humongous stars in 2022. Could you talk about plans for 2023? Then you noted in the press release and actually in the comments, that you renewed NFL and NHL. Can you talk about the cost of the renewals? I don't know that you're really bidding against anyone for those. What's coming up in the year ahead? Scott, you wanna jump in? Yeah. Thanks, Jessica. On the live events, you know, we've always used them in 2 ways. Strategically to enhance the content experience, 'cause live has always been a big audio experience, you know, in any way you get it. In addition, our subscribers, unlike a lot of other audio services, we have regular live events all over the country, some big, some small, and they're very popular as part of what the subscribers like about the service. It's always been that. In addition, as I know you're well aware, they generated a great deal of awareness both for the individual channels or content we're highlighting, but also the corporate brand as a whole. You know, the Apollo shows are obviously the sort of the pinnacle of that. We cover all 50 states and regularly do things in addition to a lot of our live sports coverage. There's, you know, ancillary side events to that and all of that. It's always gonna be part of it, but again, they're judiciously done, often with none or little cost, you know, other than, you know, the bigger ones, obviously, where you would expect that. We're gonna be always having that as part of it. It's just gonna be strategic. As far as the NFL and the NHL and all that, the NFL, as you know from our announcement, we added additional rights and a number of things on that. The NHL, you know, was a very straightforward extension. You know, I feel really comfortable on the, on the economics on that. What that did secure, which I think can't go unnoticed, is as, in particular in video, sports rights are all over the place. They're in multiple entities in multiple places, and you have to bounce around a little to get everything you want. What we have under one roof, you know, from the NFL, NBA, NHL, MLB, Formula One, NASCAR, we had every World Cup game. You know, there's nothing in sports we don't have, and our subscribers, as Jennifer mentioned, are increasing their sports listening. So we feel really comfortable that, you know, for the near future, we have all of this under one roof. Those renewals were important to us. Is there anything coming up this year? No, I don't believe... Certainly nothing in the first half of the year. I'd have to get back to you on the, on the latter part. Thank you. Thanks. Thank you. Our next and final question will be coming from the line of Jason Bazinet with Citi. Please proceed with your question. I just had one follow-up question on the relaunch of the streaming experience in the fourth quarter of this year. You mentioned a lot that it's gonna be in that MarTech ID, better user interface, recommendation engine. I guess my question is, if this goes well, what metric that you disclose do you expect the most improvement in 2024 and 2025? Is it more of a higher conversion rates? Is it an ARPU? Is it both? I'd just be curious. Yeah. great question, Jason. The first thing we're gonna be looking at is how do we, you know, retain more of our streaming, trialers, right? you know, these are fundamental capabilities that will enable us to get better insights as to what the listeners during trial are listening to, so that we can serve better recommendations, either in the product or through marketing, to improve engagement over time. We watch a lot of metrics and, you know, look, we brought in Joe Ianniello and a number of members of his team are new, that are really well-versed in this area from the video side and other parts of the streaming industry. You know, the metrics we're watching on streaming are early engagement in trial, you know, number of days, length of time, breadth of content, you know, all the things that you would expect. Those are your early indicators, obviously, of who will roll over and ultimately stay with us. I would expect improvements over the course of this year as we make, you know, enhancements to our in-market apps. You know, we're largely focused on rebuilding this architecture. We have not been well positioned here, frankly, right? We have, you know, an infrastructure that was built to serve our in-car subscribers. You know, by rebuilding the tech stack for streaming, it's gonna support, you know, streaming subscriptions, but, you know, as you mentioned, it will also help with conversion of our in-car trialers, both because we have a better out-of-car experience and because we can bring these capabilities to bear in the, you know, IP delivery of our service through 360L. We'll be watching a lot of those metrics after the launch. That's great. Thank you. Thanks, Jason. Thanks, everybody, for participating today. We'll look forward to speaking to you soon. Take care. This will conclude today's conference. Thank you for your participation. You may now disconnect your lines at this time and have a wonderful day.