XM Satellite Radio Holdings Inc. (XMSR) reported a wider net loss for the fourth quarter of 2004 on Thursday as the company bulked up on new subscribers, adding more than 700,000 in the latest quarter to top 3.2 million users.

XM, which is based in Washington, D.C., reported a net loss attributable to common shareholders of $190.4 million for the last three months of 2004, more than the loss of $170.2 million reported in the comparable period a year ago.

The per-share loss calculations, however, fell to 93 cents in the latest period from $1.12 a year ago because of an increase in the number of shares outstanding. The loss was smaller than the $1.02 per share that analysts polled by Thomson First Call had been expecting.

Revenues more than doubled in the latest quarter to $83.1 million from $33.5 million in the year-ago period. The revenues were also above the $80.5 million that analysts had been expecting.

XM has been spending heavily on programming and marketing to build up its service as it competes with rival Sirius Satellite Radio Inc. (SIRI). Both companies have been signing deals with automakers to install their devices in new cars, and both are also signing multimillion dollar deals for programming, including Major League Baseball (search) for XM and Howard Stern (search) for Sirius.

XM said it cost the company a total of $100 to add each new subscriber in 2004, down from $137 in 2003. The company disclosed in a regulatory filing that it expected to break even on a cash flow basis in 2006, and that it expects to have subscription revenues of $480 million in 2005. The company also said it expects to have 5.5 million subscribers at the end of this year.

Last month Sirius reported that it ended 2004 with more than 1.1 million subscribers and expected to finish 2005 with more than 2.5 million. Sirius is being run by Mel Karmazin, a longtime radio executive who departed last year as the president and chief operating officer of media giant Viacom Inc., the owner of CBS and MTV.

XM's stock was up 28 cents at $31.68 in midday trading on the Nasdaq Stock Market, about in the middle of its 52-week range of $20.35 to $40.89.

For the full year, XM reported a net loss attributable to common shareholders of $651 million, or $3.30 a share, versus a loss of $604 million, or $4.83 per share, in 2003. Full-year revenues rose to $244.4 million from $91.8 million in 2003.