RF Monolithics reported their quarterly results yesterday and the numbers looked good not only for RFMI, but Sirius XM (SIRI) as well. We first brought RFMI to the attention of satellite radio investors about 4 years ago, and highlighted the company as a derivative investment opportunity for people that follow satellite radio. RFMI supplies SAW Filters used in satellite radios.

RFMI reported revenue of $8.7 million, up from $6.5 million last year and $7.9 million last quarter. One big boost for RFMI was in the auto channel which makes up 36% of their business and includes the components used in satellite radios. The company reported that sales if satellite radio components was up over 100% from the depressed levels of last year and up 20% over last quarter.

The numbers reported by RFMI seem to confirm the trends we are seeing in satellite radio subscriber growth. The numbers also would indicate robust subscriber numbers for satellite radio over the next 6 months. This is the case because RFMI's components are a leading edge indication of radios to be built in the coming months.

Position - Long SIRI, No position SIRI