A compatible AM stereo broadcasting system is disclosed in which the signal is a carrier having an amplitude directly variable with monoaural or sum (L+R) information, and having an instantaneous phase .phi. varying as a function of the resultant amplitude of the sum information (L+R) and difference information (L-R) which are established in a preselected phase relationship (quadrature). In a stereo receiver, L and R or the sum and difference signals may be restored by dividing the signal by the cosine of the angle .phi., and in a monaural receiver, the sum signal alone is detected.