UPDATE 1-XM Satellite Radio quarterly loss narrows

(Adds results, dateline)

NEW YORK, July 22 (Reuters) - XM Satellite Radio Holdings Inc XMSR.O on Tuesday posted a better-than-expected quarterly net loss, which narrowed on higher revenue from subscriptions to its pay-radio service.

One day after it released a preliminary report detailing subscriber data, XM said its net loss was $120 million, or 38 cents a share, compared with a loss of $176 million, or 57 cents a share, a year earlier.

Analysts had expected a loss of 44 cents a share, according to Reuters Estimates.

Second-quarter revenue for XM, which is in the process of being acquired by rival broadcaster Sirius Satellite Radio (SIRI.O), rose 15 percent, to $318 million from $277 million.

XM said the cost of acquiring each subscriber, also known as Subscriber Acquisition Costs, declined to $65 from $75 in the second quarter of 2007.

XM ended the quarter with about 9.65 million customers.

XM and Sirius are awaiting word from the U.S. Federal Communications Commission, which is expected to comment soon on the pending merger. The FCC decision is the final hurdle in a regulatory marathon for the deal, which was first announced in February 2007.

Antitrust authorities at the U.S. Justice Department approved the merger in March. (Reporting by Franklin Paul, editing by Mark Porter)