Globalstar's stock is soaring. Amazon is buying the company to challenge Elon Musk and Starlink.

By William Gavin

The deal, which values Globalstar at about $11.6 billion, could help Amazon deliver direct-to-device communications services

Amazon is relying on launch providers like SpaceX, United Launch Alliance and Arianespace to send thousands of satellites into low-Earth orbit.

Amazon has announced an agreement to buy Globalstar in a deal that values the satellite company at $11.6 billion, as the technology giant seeks to rival Elon Musk's SpaceX.

The acquisition will enable Amazon's (AMZN) Leo satellite-internet division to offer direct-to-device communication services for customers, expanding its planned offerings. Amazon's nascent service has so far focused on enterprise customers and began offering select companies trials in late 2025.

And for Globalstar (GSAT), it delivers a big win. Globalstar Chair James Monroe had reportedly discussed selling the company for $10 billion, and his company had also been in talks with SpaceX.

The stock rallied 9.7% in recent morning trading toward an 18-year high. It has rocketed 309.2% over the past 12 months.

Amazon's stock gained 2.6% toward a three-month high.

Under terms of the agreement, Globalstar shareholders could either receive $90 in cash for each share of common stock they own or trade their shares in for a slice of Amazon stock. The cash price would imply a market capitalization for Globalstar of $11.6 billion.

The deal is expected to close sometime next year, assuming regulator approval.

As part of its agreement, Amazon will also power satellite services for Apple's (AAPL) newer iPhones and smartwatches. Globalstar had previously agreed to reserve 85% of its capacity for Apple's satellite-based services as part of Apple's $1.5 billion investment in the company.

"The combination with Amazon Leo will advance innovations in digital connectivity that will benefit our customers and advance us toward a more intelligent, continuously connected world," Globalstar CEO Paul Jacobs said in a statement.

Amazon has invested billions of dollars in Leo, which it launched as Project Kuiper in 2019. Last week, CEO Andy Jassy told investors that Leo would be capable of delivering service "about six to eight times better on uplink, and two times better on downlink" than what's currently on the market, and at a cheaper cost than rivals.

Amazon has said it has dozens of commercial agreements and plans to launch in mid-2026. On Tuesday, the company said it would deploy its own D2D satellite system in 2028, which would compete with SpaceX's Starlink and AST SpaceMobile (ASTS).

See: Amazon wants to be a satellite powerhouse. For now, the effort is a financial black hole.

As part of the deal with Globalstar, Amazon will acquire its existing infrastructure and assets, including spectrum licenses and two dozen satellites.

William Blair analyst Louie DiPalma said in a recent note to clients that both SpaceX and AST SpaceMobile will likely look to acquire more spectrum to add capacity to their networks, according to Barron's. SpaceX has already agreed to buy roughly $20 billion worth of spectrum from EchoStar (SATS).

Viasat (VSAT) has the most mobile-satellite spectrum, DiPalma said, followed by Globalstar and Iridium Communications (IRDM). Viasat shares inched up less than 0.1% on Tuesday, while Iridium shares slipped 0.1%.

If Amazon wants to deliver its services, it will need a lot more satellites. It currently has just a few hundred operational satellites, while SpaceX has more than 10,000 and already serves both enterprise customers and the wider public.

See: These little-known chip stocks could be winners as SpaceX and Amazon make big satellite pushes

In January, Amazon asked the Federal Communications Commission to give it another 24 months to meet a July deadline to launch the first half of its 3,232-satellite system to orbit, citing delays from launch providers. It also recently received permission to put another few thousand satellites into orbit by 2035.

-William Gavin

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04-14-26 1030ET