Amazon.com Inc (NASDAQ:AMZN)’s agreement to acquire Amazon.com Inc.’s satellite partner Globalstar Inc for about $12.5 billion is a strategically “long-duration” move that strengthens its direct-to-device ambitions while requiring no meaningful near-term cash strain, according to Jefferies analysts.
In a note following the announcement, Jefferies said it views the deal positively, arguing it accelerates Amazon’s roadmap to launch satellite-to-device services by 2028 and enhances its competitive positioning against SpaceX’s Starlink.
The broker highlighted that the acquisition brings Globalstar’s existing satellite-enabled service footprint along with valuable spectrum rights and operational know-how.
Amazon will acquire Globalstar at $90 per share, implying an enterprise value of roughly $12.5 billion. Jefferies noted the structure limits near-term cash requirements, with a maximum 40% cash component, or about $5 billion, and the remainder payable in Amazon stock.
While the deal does not materially increase Amazon’s 2026 funding needs, which are already heavily directed toward capital expenditures in cloud and AI infrastructure, analysts noted that the acquisition is expected to be Amazon’s second-largest on record, behind its $14 billion purchase of Whole Foods Market in 2017.
Strategically, Jefferies said the transaction strengthens Amazon’s “Leo” satellite initiative by incorporating Globalstar’s mobile satellite services spectrum and direct-to-device technical capabilities, both of which could help shorten development timelines versus a greenfield constellation buildout. Amazon is targeting thousands of low Earth orbit satellites in coming years, though its current fleet remains far smaller than Starlink’s more than 10,000 satellites already deployed.
The note flagged both bull and bear scenarios. On the positive side, Jefferies said Globalstar’s assets de-risk Amazon’s satellite roadmap and provide early scale advantages through existing commercial relationships, including its partnership with Apple and integration into iPhone satellite features.
On the cautious side, the analysts pointed to execution and timing risks, noting that meaningful financial contributions from the satellite business are unlikely before 2028 given regulatory approvals and phased deployment schedules.
Despite the long-dated payoff, Jefferies maintained a constructive view on Amazon’s broader investment case, describing the company as a “top pick” supported by attractive valuation metrics and multi-year growth optionality across e-commerce, cloud computing and emerging connectivity platforms.
While still early-stage, Jefferies concluded that the acquisition enhances Amazon’s ability to compete in the emerging direct-to-device satellite market and strengthens its positioning in what it sees as a multi-year strategic race for global connectivity infrastructure.
The acquisition is expected to close in 2027.