SpaceX Faces Competition as Amazon Acquires Globalstar
Amazon has agreed to acquire Globalstar for approximately $11.6 billion, significantly boosting its capacity in the low Earth orbit (LEO) satellite market as it works on its Amazon Leo constellation. This move comes after Amazon launched its first LEO satellites in 2022, and it aims to deploy over 3,000 satellites by July 30, 2026, having currently deployed just 241. In contrast, SpaceX’s Starlink already has over 10,000 satellites in orbit, giving it a pronounced lead.
The acquisition provides Amazon with 24 operational satellites and critical radio spectrum licenses essential for data transmission. However, Amazon’s reliance on third-party launch services creates a bottleneck in satellite deployment, while SpaceX can launch its own rockets. Investors may face increased financial pressure as Amazon plans to invest $200 billion in capital expenditures this year, potentially impacting its free cash flow negatively by 2026.
