Houston, Amazon.com Has a Problem -- and It's in Europe!

When it comes to fast, globe-spanning, broadband internet service delivered from space, Americans basically have two companies to choose from: Space Exploration Technologies (NASDAQ: SPCX), whose Starlink satellite system is already up and running, and Amazon.com (NASDAQ: AMZN), whose Amazon Leo system will begin operating in a limited fashion "later this year" but won't be fully operational until 2028.

And that's if Amazon is lucky.

Image source: Getty Images.

Amazon and the FCC

This story is a little bit complicated, so let me roll it out for you in stages -- beginning with Kuiper. Amazon first announced its plans to build a satellite internet system to rival Starlink back in 2021. Dubbed Project Kuiper at the time, the plan was initially to put 3,236 satellites in orbit.

The U.S. Federal Communications Commission greenlit Amazon's plan on the condition that the company prove it could deliver by placing at least half of its satellites in orbit by July 2026.

Amazon failed to do that. It's got fewer than 400 satellites in orbit today, and far fewer than the 1,618 satellites implied by the FCC's condition. Even counting the 24 Globalstar satellites Amazon will inherit when it closes its $11.5 billion acquisition of Globalstar (NASDAQ: GSAT), Amazon will be far short of its goal.

No matter. Amazon gave the FCC a heads-up about its delay, and the government agency compliantly waived the 50% milestone in June. Now all Amazon needs to do to get permission to start the Amazon Leo service is get all 3,236 satellites deployed by July 2029 -- and everything will be fine.

That was the good news...

The bad news for Amazon is that things are presently not going fine with its plans to deploy more satellites. Why not? Because Amazon's having a tough time finding someone to launch its satellites in the first place.

If you recall, Amazon went on a rocket-buying spree back in 2022, signing contracts with three of the world's biggest space organizations to launch its Kuiper (now Leo) satellites. United Launch Alliance, the joint venture between Boeing and Lockheed Martin, would launch 47 times for Amazon with a mix of legacy Atlas V rockets and new Vulcan Centaurs. Sister company Blue Origin -- like Amazon, founded by Jeff Bezos -- would provide 27 launches on its New Glenn megarocket. Airbus (OTC: EADSY) subsidiary Arianespace would round out the contracts with 18 launches on its Ariane 6.

Problem is -- problems are -- both ULA's and Blue Origin's rockets are presently grounded, and now Ariane's probably will be as well.

ULA's Vulcan suffered a launch anomaly in October 2024, when one of the nozzles that directs exhaust flow from Vulcan's two solid rocket boosters fell off during launch. A second anomaly struck in February 2026 when the rocket's engine exhaust burned through the booster nozzle. Vulcan hasn't flown since, and the Space Force paused further launches while the rocket's defects are resolved.

Blue Origin has a different problem. In May 2026, a New Glenn rocket exploded during pre-flight testing, destroying both rocket and launch pad. The FAA has already cleared Blue to try again, but it's still busy rebuilding its launch pad.

Will Europe's Ariane save the day?

Amazon was hoping that Ariane could pick up the slack from ULA and Blue Origin. Earlier this month, the company announced it was adding six new Ariane 6 launches to plug the gap created by ULA's and Blue Origin's groundings. With the ability to carry 36 Leo satellites at a time to orbit, this would have grown Amazon's satellite constellation by more than 50%.

But then the third shoe dropped.

Last week, Arianespace -- by this point the only space company still launching for Blue Origin -- announced it had discovered a "turbopump anomaly" on its Ariane 6 rocket. So now Ariane, too, is pausing further launches to fix its problems -- which means Ariane won't be putting any Leo satellites in orbit anytime soon, either.

The upshot for Amazon

Amazon managed to get off seven Leo launches this year despite all these problems -- four on ULA Atlas V rockets, and three on Ariane 6 rockets. Three more launches are technically scheduled to happen this year: Vulcan, New Glenn, and Ariane 6. It's even (remotely) possible this will happen if everyone resumes flying in short order.

It's more likely, however, that the gremlins will keep cropping up -- and that Amazon is done launching for the year.

So what's the upshot? Lacking its own rockets to launch its own satellites, Amazon is at the mercy of its launch providers here. Now Amazon's cooling its heels on Earth, and the only thing moving is its July 2029 deadline -- which is getting closer by the day.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon, Boeing, and Lockheed Martin. The Motley Fool has a disclosure policy.