SpaceX's Satellite Loss: Opportunity or Obstacle for AST SpaceMobile?

The recent in-orbit anomaly involving SpaceX's Starlink satellite 35956 has reignited debates about orbital safety and the long-term sustainability of low-Earth orbit (LEO) operations. While the incident underscores systemic risks in managing large satellite constellations, it also highlights a pivotal moment for competitors like AST SpaceMobile (ASTS). For investors, the question is whether this disruption represents a tailwind or headwind for AST SpaceMobile's ambitious vision to build a mobile satellite network.

The SpaceX Incident: A Wake-Up Call for Orbital Safety

On December 17, 2025, SpaceX reported a loss of communication with Starlink satellite 35956 after an in-orbit anomaly caused its propulsion tank to vent, leading to a partial breakup and the release of trackable debris. The satellite, now tumbling and descending, is expected to re-enter Earth's atmosphere within weeks. While SpaceX emphasized that the event posed no risk to the International Space Station, the incident has intensified scrutiny over debris mitigation practices and the scalability of mega-constellations.

This event aligns with broader concerns raised by SpaceX itself about AST SpaceMobile's satellite designs. SpaceX has criticized AST's larger "BlueBird" satellites for underestimating collision risks during decommissioning and for potential ferromagnetic components that could survive re-entry. Such critiques highlight a growing tension between rapid constellation deployment and orbital safety-a challenge that could benefit companies with robust risk-mitigation strategies.

AST SpaceMobile's Strategic Resilience: Manufacturing, Partnerships, and Wall Street Confidence

Despite these headwinds, AST SpaceMobile has demonstrated strategic resilience through aggressive manufacturing expansion and commercial partnerships. The company has doubled its U.S. workforce to 1,800 employees and added two new facilities in Midland, Texas, and Homestead, Florida, verticalizing nearly 95% of its production process domestically. This vertical integration not only reduces supply chain vulnerabilities but also positions AST to scale rapidly, with plans to launch 45–60 satellites by 2026.

Commercially, AST has secured a $1 billion contracted backlog, including a $175 million prepayment from stc Group, a major Middle Eastern telecom operator. Partnerships with U.S. carriers AT&T and Verizon further solidify its market position, as these alliances aim to diversify the satellite communications ecosystem and reduce over-reliance on SpaceX's Starlink. While AT&T and Verizon's investments are costly in the short term, they reflect a strategic imperative to hedge against monopolistic risks in the sector.

Wall Street has taken notice. Clear Street upgraded AST's price target from $59 to $87, maintaining a "Buy" rating, citing confidence in the company's technological advancements and long-term growth potential. This optimism is partly fueled by AST's 91% stock surge over six months and its projected capture of 15–20% of the $150 billion underserved market by 2035, with revenue expected to reach $10 billion.

Risks and Long-Term Opportunities

The path forward is not without risks. SpaceX's public concerns about AST's satellite designs could lead to regulatory hurdles or increased insurance costs. Additionally, AST's current financials-marked by a negative pretax profit margin and declining revenue-underscore the need for sustained investment in R&D and operational efficiency.

However, the post-Starlink landscape may also create opportunities. As SpaceX grapples with debris management and software updates, AST's focus on larger, more durable satellites could differentiate its offerings. The company's emphasis on domestic production and partnerships with major U.S. carriers aligns with geopolitical trends favoring supply chain resilience and national security.

Conclusion: A Calculated Bet on Orbital Sovereignty

SpaceX's satellite loss is a reminder of the fragility of LEO operations, but it also underscores the importance of diversified infrastructure in the space communications sector. For AST SpaceMobile, the incident highlights both challenges and openings. While regulatory and technical risks persist, the company's manufacturing expansion, commercial partnerships, and Wall Street backing suggest a strategic commitment to long-term growth. Investors who view AST's progress as a calculated bet on orbital sovereignty-rather than a direct competitor to Starlink-may find compelling value in its trajectory.