Most of the markets are down today after President Trump’s address to the nation last night failed to alleviate fears about America’s war with Iran dragging on.
But one relatively small tech company is bucking the downward trend in premarket trading this morning: Globalstar.
The satellite communications company is reportedly an acquisition target for Amazon, yet its relationship with Apple could complicate any potential deal. Here’s what you need to know.
What’s happened?
Shares in the relatively small satellite communications company Globalstar, Inc. (Nasdaq: GSAT) are rising today after a Financial Times report yesterday said the ecommerce giant Amazon was in talks to acquire the company.
As of the time of this writing, GSAT shares are up nearly 14% to around $78 apiece—making it one of the only tech companies to see significant gains this morning in premarket trading.
The company’s share price closed yesterday at $68.53, putting its valuation at around $9 billion.
While Globalstar is not a household name, the company has been in operation for over 35 years. It is the operator of a network of low Earth orbit satellites that provide communication services to companies across industries, from defense to Big Tech.
Why does Amazon want to buy Globalstar?
It’s important to note that while Amazon is rumored to be in negotiations with Globalstar, a deal could still fail to materialize, according to the FT.
That being said, the obvious main driver behind Amazon’s interest in Globalstar would be to gain access to its network of satellites so Amazon can better compete with Elon Musk’s Starlink satellite internet service, which is operated by Musk’s company, SpaceX.
Amazon is currently building out its competing high-speed satellite internet service, Leo, which aims to challenge Starlink’s dominance in the space.
However, Leo currently lags significantly behind Starlink in the number of satellites each company operates. While SpaceX has over 10,000 satellites in its Starlink network, Amazon’s Leo has a constellation of less than 200.
By acquiring Globalstar, Amazon could play catchup not just by adding the company’s satellites to its existing fleet, but by acquiring the technology, talent, and expertise that the 35-year-old company possesses.
That’s something Amazon needs as it expands its Leo service. Yesterday, the company announced that Leo would power in-flight Wi-Fi for Delta Air Lines in 2028.
Apple’s relationship with Globalstar could complicate things
Unfortunately for Amazon, if it wants to acquire Globalstar, it doesn’t only need to negotiate with the satellite provider itself. Amazon also needs to deal with Apple. That’s because Apple actually owns 20% of Globalstar.
The iPhone giant made a $1.1 billion investment in the satellite firm in 2024, giving it partial ownership of the company as part of the deal.
As 9to5Mac reported at the time, Apple made the investment to help Globalstar expand its infrastructure, which Apple uses to power its “Emergency SOS” features on the iPhone and Apple Watch.
The feature allows iPhone and Apple Watch users to make emergency phone calls and send emergency texts from their devices, even when they have no standard cellular signal. This is possible due to the satellite connectivity Globalstar provides.
The Financial Times reported that Apple’s 20% ownership of Globalstar was a “complicating factor” in the current negotiations.
Fast Company has reached out to Amazon, Apple, and Globalstar for comment.
GSAT stock jumps while AAPL and AMZN fall
It’s little surprise that GSAT is surging on rumors that the deep-pocketed Amazon was in talks to acquire Globalstar.
As of this writing, it is up 14% in premarket trading. That’s on top of yesterday’s 3% gain for GSAT.
And even before today’s premarket price jump of nearly 14%, GSAT shares have been on a roll. As of yesterday’s close, GSAT shares were up more than 12% for the year, and over the past 12 months, they have risen an astounding 230%.
Globalstar’s stock price gain contrasts starkly with the fall in Apple Inc. (AAPL) and Amazon.com, Inc. (AMZN) shares today. The stock prices of both tech giants are down in the low single digits as of the time of this writing.
But those price declines likely are a reflection of the broader market selloff after Trump’s address to the nation on Wednesday, which did not alleviate fears about the Iran war dragging on.
And as for Starlink, Reuters reported yesterday that SpaceX, the Amazon Leo competitor’s parent company, has confidentially filed for its initial public offering, which is expected in June.