Shares surged +3.15% to $247.44 as Amazon confirmed an $11.6 billion deal to buy satellite operator Globalstar, instantly escalating its space ambitions from broadband experiment to full-spectrum connectivity play. The question now: does doubling down on a capital-intensive race against SpaceX's Starlink make this a long-term win or an expensive distraction?
The Deal Gives Amazon Something Money Alone Couldn't Build Fast Enough. Amazon will acquire Globalstar's existing satellite operations, infrastructure, and assets, including globally authorized spectrum licenses.
Shareholders get $90 in cash per share, or 0.32 shares of Amazon stock capped at $90.
Globalstar has more than 24 satellites in orbit and agreements for over 50 new ones. Spectrum — the radio frequencies satellites use to talk to phones — takes years to license. Buying Globalstar leapfrogs that bottleneck, which matters because Amazon expects only about 700 satellites by its FCC deadline, far short of the ~1,600 required by July 2026.
Apple Stays in the Picture, Turning a Rival Risk Into a Revenue Stream. Amazon and Apple announced an agreement for Amazon Leo to power satellite services for iPhone and Apple Watch, including Emergency SOS.
Apple invested $1.5 billion in Globalstar in 2024 for a 20% stake, with 85% of network capacity reserved for iPhone features. Rather than losing that relationship, Amazon inherits a paying anchor customer — a shrewd way to offset the acquisition cost.
The Price Tag Adds to an Already Enormous Bill. Market analyses estimate Amazon's total satellite spending at $16.5 billion to $20 billion — and that was before this deal. Adding $11.6 billion pushes the all-in figure past $30 billion. Internal projections suggest the satellite business could become a $20 billion annual revenue stream by 2030, but analysts see end of 2027 as the earliest for any meaningful revenue contribution. That's a long runway of cash burn for a company already investing heavily in AI infrastructure.
The Real Race Is Against SpaceX — and the Clock. This deal is an effort to compete with SpaceX's Starlink, just months before SpaceX is expected to launch the largest IPO ever.
Amazon's Leo network has 241 satellites in orbit, far behind Starlink's 10,000-plus. Globalstar's spectrum and phone-to-satellite technology narrow the gap, but the infrastructure deficit remains massive. The deal is expected to close in 2027, meaning real integration benefits are still years away.
Bottom line: Today's pop reflects optimism that Amazon is buying strategic shortcut, not just hardware. Whether shareholders are right depends on execution speed — and whether $30 billion-plus in space spending can eventually generate returns rivaling what that capital could earn inside AWS.