Amazon.com Inc. filed an application with the Federal Communications Commission on Monday seeking approval to launch up to 5,105 low Earth orbit satellites for its Amazon Leo Direct-to-Device system. The e-commerce giant aims to deploy the constellation by 2028, a move that directly challenges Space Exploration Technologies Corp.’s Starlink service in the growing market for smartphone-based satellite connectivity. By targeting direct-to-device capabilities, Amazon intends to bypass traditional infrastructure limitations, offering seamless global coverage through standard mobile devices rather than specialized hardware.

The regulatory filing represents a strategic pivot following Amazon’s merger agreement with Globalstar in April this year. According to the company, Globalstar’s spectrum rights will enable the integration of direct-to-device features into its broader satellite network. Amazon currently operates more than 390 satellites in orbit, utilizing Leo Nano, Leo Pro, and Leo Ultra ground antennas to deliver initial services. The proposed expansion would significantly increase its orbital footprint, allowing for higher capacity and improved reliability for consumer and enterprise clients alike.

Competitive Landscape

The push into direct-to-device technology places Amazon in direct competition with Elon Musk-led Space Exploration Technologies Corp., which has aggressively expanded its Starlink Mobile offerings. While regulators have previously urged Amazon to focus on deployment milestones rather than opposing competitors’ plans, the company continues to broaden its partnerships. Notable collaborations include agreements with Apple Inc., enhancing the ecosystem for satellite-enabled devices. Meanwhile, Starlink has recently activated free satellite texting services for Movistar and MasOrange customers in wildfire-affected regions near Madrid, demonstrating operational resilience during network outages.

Pricing and Service Dynamics

Competition in the aviation sector also remains intense, with both companies vying for business travel contracts. Space Exploration Technologies Corp. recently increased prices for its Starlink aviation plans, reflecting strong demand or cost adjustments. The revised pricing structure includes three tiers: Starlink Regional 25 GB at $4,000 per month, Aviation Regional Unlimited at $12,500 per month, and Aviation Global Unlimited at $20,000 per month. These price hikes underscore the premium nature of high-bandwidth satellite connectivity in flight, a segment where Amazon’s Leo service aims to gain traction through integrated device solutions.

What the Numbers Show

The scale of Amazon’s proposed satellite constellation—5,105 units—highlights the capital-intensive nature of competing with established players like Starlink. While Starlink boasts speeds up to 10-Gigabit-per-second globally, Amazon’s strategy relies on leveraging Globalstar’s spectrum and existing orbital assets to achieve comparable coverage. The divergence in approach—Starlink focusing on high-speed broadband via dedicated terminals versus Amazon’s direct-to-device integration via smartphones—suggests a bifurcation in market segments. Investors should monitor FCC approval timelines and deployment progress in 2028 as key indicators of Amazon’s ability to capture market share in the satellite internet space.

Amazon.com Inc is poised to exceed expectations in its second-quarter results, driven by accelerating growth in Amazon Web Services (AWS) and robust artificial intelligence demand, according to Bank of America. The brokerage reiterated its Buy rating and raised its price forecast to $310, citing improved AI positioning and momentum in generative AI services as key catalysts for the second half of 2026. The firm's outlook suggests that heavy investment in AI infrastructure will strengthen AWS as a dominant supplier of scarce compute capacity.

AWS Growth and Earnings Outlook

Bank of America now projects second-quarter revenue of $198.8 billion and operating income of $24.1 billion, surpassing Wall Street consensus estimates of $196.8 billion and $23.6 billion, respectively. The firm increased its AWS revenue growth forecast to 33% year over year, up from a prior estimate of 31%, citing demand from Anthropic, OpenAI-powered Bedrock services, and broader enterprise adoption. Analysts expect third-quarter revenue guidance to range between $200.5 billion and $205.5 billion, noting that an earlier Prime Day may shift retail sales into the second quarter.

AI Spending and Strategic Investments

The brokerage anticipates Amazon could increase its 2026 capital expenditure outlook to about $210 billion due to higher memory costs and additional AI infrastructure investment. While this spending may weigh on near-term sentiment, analysts believe stronger cloud demand and improving AI monetization will offset these concerns. The firm estimates that Anthropic-related workloads alone could contribute more than $1.5 billion in sequential AWS revenue growth, while Amazon's stake in the AI startup could generate a significant mark-to-market gain.

Analyst Consensus and Price Targets

Amazon is scheduled to report second-quarter results on July 30. Wall Street estimates earnings per share of $1.82, up from $1.68 a year earlier, with revenue projected to reach $196.02 billion compared to $167.70 billion in the prior-year quarter. The stock maintains a Buy consensus rating with an average price forecast of $320.10.

Market Performance

Amazon.com shares were down 1.47% at $243.91 at the time of publication on Wednesday. The stock is a major holding in several exchange-traded funds, including the iShares Russell Top 200 Value ETF (IWX) at 8.32%, the Invesco Nasdaq Internet ETF (PNQI) at 9.89%, and the ClearBridge Large Cap Growth ESG ETF (LRGE) at 9.29%.