Could Acquiring the Satellite Communications Company Globalstar Send Amazon Stock Soaring?
Key Points
Amazon is reportedly mulling a takeover of the LEO satellite maker Globalstar.
It makes strategic sense, but it would likely weigh down Amazon’s stock.
- These 10 stocks could mint the next wave of millionaires ›
Globalstar's (NASDAQ: GSAT) stock recently popped amid reports that Amazon (NASDAQ: AMZN) was in talks to acquire the satellite maker for $8.8 billion. Let's see why Amazon might be interested in Globalstar, and if a takeover would drive its stock higher.
Why could Amazon be interested in Globalstar?
Amazon is already the world's largest e-commerce and cloud infrastructure company, but it's been quietly building its own low-earth orbit (LEO) satellite business to challenge SpaceX's Starlink and AST SpaceMobile (NASDAQ: ASTS) in the nascent market.
Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. Continue »
Image source: Getty Images.
Amazon Leo, the company's LEO satellite business formerly known as Project Kuiper, has already deployed 180 satellites and aims to deliver cellular connectivity to rural areas that terrestrial towers can't reach. The Federal Communications Commission (FCC) already approved Amazon's plan to launch a constellation of more than 3,200 satellites in 2020.
Amazon Leo is much bigger than AST SpaceMobile, which has only launched eight satellites so far. Still, it's tiny compared to Starlink, which operates a network of over 9,500 satellites. Starlink already serves over nine million users globally -- including individual consumers, businesses, and government agencies -- and accounts for 50%-80% of SpaceX's revenue.
Globalstar currently has 48 satellites in orbit, plans to launch another 48 in the near future, and has a long-term target of building a constellation of 3,080 satellites. So while buying Globalstar won't help Amazon catch up to SpaceX ahead of its planned IPO, it could support the expansion of its LEO satellite business into a new revenue stream alongside its core e-commerce, cloud, and digital advertising businesses. It could also support the expansion of its cloud platform, Amazon Web Services (AWS), into more edge networks and Internet of Things (IoT) devices.
Will buying Globalstar boost Amazon's stock?
Amazon's stock has declined 8% year to date. Most of that decline can be attributed to its plans to invest up to $200 billion in its cloud and AI infrastructure this year, the attacks on its data centers in the Middle East, and the impact of rising oil prices on its e-commerce business.
Therefore, Amazon's investors probably aren't too thrilled about its rumored interest in Globalstar, an unprofitable company that only generated $273 million in revenue in 2025. An $8.8 billion bid would value the satellite maker at 32 times its trailing sales.
In addition to that premium valuation, Amazon might need to increase its bid to convince Apple -- which owns 20% of Globalstar's shares -- to approve that takeover. While it might make strategic sense for Amazon to buy Globalstar as an ecosystem-expanding investment, I'd expect a deal to drag down its stock rather than lift it to new heights.
Don’t miss this second chance at a potentially lucrative opportunity
Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.
On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:
- Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $460,126!*
- Apple: if you invested $1,000 when we doubled down in 2008, you’d have $48,732!*
- Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $532,066!*
Right now, we’re issuing “Double Down” alerts for three incredible companies, available when you join Stock Advisor, and there may not be another chance like this anytime soon.
See the 3 stocks »
*Stock Advisor returns as of April 6, 2026.
Leo Sun has positions in Amazon and Apple. The Motley Fool has positions in and recommends AST SpaceMobile, Amazon, and Apple and is short shares of Apple. The Motley Fool has a disclosure policy.
Recommended Articles
