Related Party Transactions |
3 Months Ended |
|---|---|
Mar. 31, 2026 | |
| Related Party Transactions [Abstract] | |
| Related Party Transactions |
Related Party Transactions In the normal course of business, we enter into transactions with our equity method investments (tax equity investments, Sirius XM Canada and SoundCloud) which are considered related party transactions.
Tax Equity Investments
We made tax-efficient investments of $53 and $49 during the three months ended March 31, 2026 and 2025, respectively, in clean energy technology projects. Effective January 1, 2024, we adopted ASU 2023-02 using the modified retrospective approach and now account for these investments under the proportional amortization method. As of March 31, 2026, the unamortized investment balance of these investments totaled $738 and was reported within in our unaudited consolidated balance sheets. Under the proportional amortization method, the investment balance is amortized over the term of the investments in proportion to the current period income tax benefits relative to the total expected income tax benefits. Additionally, we recorded liabilities of $604 related to future contractual and contingent payments which we determined to be probable. Of this amount, $120 is presented in Related party current liabilities with the remaining balance included in Other long-term liabilities in our unaudited consolidated balance sheets.
Sirius XM Canada
SiriusXM holds a 70% equity interest and 33% voting interest in Sirius XM Canada, a privately held corporation. We own 591 shares of preferred stock of Sirius XM Canada, which has a liquidation preference of one Canadian dollar per share.
Sirius XM Canada is accounted for as an equity method investment, and its results are not consolidated in our unaudited consolidated financial statements. Sirius XM Canada does not meet the requirements for consolidation as we do not have the ability to direct the most significant activities that impact Sirius XM Canada's economic performance.
SiriusXM and Sirius XM Canada are parties to an amended and restated services and distribution agreement. Pursuant to this agreement, the fee payable by Sirius XM Canada to SiriusXM was modified from a fixed percentage of revenue to a variable fee, based on a target operating profit for Sirius XM Canada. This variable fee is expected to be evaluated annually based on comparable companies. In accordance with the amended and restated services and distribution agreement, the fee is payable on a monthly basis, in arrears.
Our Equity method investments as of March 31, 2026 and December 31, 2025 included the carrying value of our investment balance in Sirius XM Canada of $102 and $100, respectively, and, as of March 31, 2026 and December 31, 2025, also included $7 and $8, respectively, for the long-term value of the outstanding loan to Sirius XM Canada.
We recorded revenue from Sirius XM Canada as Other revenue in our unaudited consolidated statements of operations of $26 and $22 during the three months ended March 31, 2026 and 2025, respectively.
SoundCloud
In February 2020, we completed a $75 investment in Series G Membership Units of SoundCloud. The Series G Units are convertible at the option of the holders at any time into shares of ordinary membership units of SoundCloud at a ratio of one ordinary membership unit for each Series G Unit. The investment in SoundCloud is accounted for as an equity method investment as we do not have the ability to direct the most significant activities that impact SoundCloud's economic performance.
Our investment in SoundCloud is recorded in Equity method investments in our unaudited consolidated balance sheets. Sirius XM has appointed two individuals to serve on SoundCloud's ten-member board of managers.
In addition to our investment in SoundCloud, Pandora has an agreement with SoundCloud to be its exclusive ad sales representative in the U.S. and certain European countries. Through this arrangement, Pandora offers advertisers the ability to execute campaigns across the Pandora and SoundCloud platforms. We recorded revenue share expense related to this agreement of $11 and $13 for the three months ended March 31, 2026 and 2025, respectively. We also had related party liabilities of $15 and $12 as of March 31, 2026 and December 31, 2025, respectively, related to this agreement.
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