Shares of AST SpaceMobile (ASTS) surged nearly 12% on Thursday, climbing to $83.66 after the three largest U.S. wireless carriers—AT&T, T-Mobile US, and Verizon—announced a preliminary agreement to form a joint venture focused on satellite-based direct-to-device connectivity. The stock briefly touched an intraday high of $84.46, pushing the company's market capitalization to approximately $24.3 billion.
Carriers Collaborate to Eliminate Coverage Gaps
The proposed joint venture aims to leverage satellite technology to extend standard mobile phone service beyond the reach of traditional cell towers, targeting persistent dead zones across the country. The carriers have positioned the initiative as a way to pool scarce spectrum resources, establish common technical standards, and broaden satellite access for consumers. However, the plan remains subject to final definitive agreements and customary closing conditions.
AST SpaceMobile, which already partners with AT&T and Verizon, threw its full support behind the proposal. CEO Abel Avellan described the company as a "key enabler" for the industry's rollout of space-based cellular broadband to U.S. consumers. The company's technology is designed to connect unmodified smartphones directly to satellites, bypassing the need for specialized hardware.
Competitive Landscape Heats Up
The carrier joint venture comes amid intensifying competition in the direct-to-device satellite market. T-Mobile has teamed up with SpaceX's Starlink, while Verizon is pursuing its own path via Skylo. Both AT&T and Verizon maintain existing links with AST SpaceMobile. Amazon is also entering the fray with its Project Kuiper satellite venture and a partnership with Globalstar, adding another heavyweight to the mix.
SpaceX looms large over the broader satellite communications sector. Prediction markets on Kalshi give 71% odds that a SpaceX IPO announcement will occur before July 1, with the probability rising to 87% before August 1. Polymarket traders peg SpaceX at 87% to claim the title of 2026's biggest IPO by market cap. While these wagers do not dictate telecom strategy, they underscore why established players may want to establish a roadmap before Starlink calls the shots.
Technical and Financial Hurdles Remain
Industry analyst Roger Entner of Recon Analytics noted that direct-to-device service is not yet seamless. Key issues include handoffs to terrestrial networks, spectrum alignment, and user verification. A common specification could unlock a wider satellite market, moving beyond tailor-made agreements for each carrier.
AST SpaceMobile is racing to demonstrate its ability to scale. On May 11, the company reported that BlueBird satellites 8, 9, and 10 remain on track for a Falcon 9 launch around mid-June. BlueBird satellites 11 through 33 are already in advanced production, and management reaffirmed its 2026 target of roughly 45 BlueBird satellites in orbit. The company has achieved peak data speeds of 98.9 Mbps from its in-orbit Block 1 BlueBird satellite to an unmodified smartphone, and holds U.S. FCC clearance for commercial operations across a network that could expand to as many as 248 satellites.
For 2026, management projects revenue between $150 million and $200 million, with most of that figure expected from mobile network partners and U.S. government contracts. However, the financial picture remains challenging. The company reported first-quarter revenue of $14.7 million and a net loss to common stockholders of $191.0 million, or $0.66 per share. Operating expenses increased as the company ramped up spending on engineering and manufacturing. As of the end of March, AST SpaceMobile held approximately $3.46 billion in cash, cash equivalents, and restricted cash, enough to support its current plan for the next 12 months.
Analysts Express Caution
Analysts at Raymond James, including Ric Prentiss and Frank Louthan, questioned whether carriers have a firm grip on direct-to-device economics, noting that "demand and economics" for these services remain uncertain. LightShed's Walter Piecyk and Joe Galone were more blunt, suggesting that the "agreement in principle" felt as much about the timing of the announcement as the substance of the deal.
Thursday's surge in AST SpaceMobile stock is less a verdict and more a test. The company's carrier project could open up satellite-to-phone services to a broader market, but AST still needs to get its satellites into orbit, convert partnerships into actual revenue, and prove that its space-based broadband can ultimately turn a profit on Earth.
