Global internet connectivity via telecommunication satellite in low earth orbit above Europe.
Apple (Nasdaq: AAPL) disclosed details of an expanded deal with satellite communications company Globalstar (Nasdaq: GSAT) worth $1.5 billion which is expected to close this week.
The new deal will fund a new mobile satellite services network. Back in 2022, Apple began connecting to Globalstar’s satellites whenever its iPhones went out of cellular and Wi-Fi coverage.
Apple’s deal includes a pre-payment of up to $1.1 billion of which $232 million will go toward retiring the satellite company’s debt. Apple will also take a 20% equity stake in Globalstar.
Globalstar estimates that annual revenue will more than double along with higher profit margins following the launch of the expanded satellite services.
Apple is trading at $221 a share, up 19% year-to-date. Globalstar is trading at $1.57 a share, down 8% year-to-date.
