Eutelsat's LEO Ambition: Assessing the Path to Market Share vs. Starlink

Eutelsat's recent agreement with French rocket builder MaiaSpace is a necessary step for operational continuity, not a leap toward market leadership. The company has signed a multi-launch deal for future deployments of its OneWeb satellites, with operations set to begin in 2027. This provides a complementary launch option alongside existing partners like SpaceX and India's ISRO, ensuring the company can replenish and expand its constellation without relying solely on foreign providers.

The strategic purpose is clear: to maintain service continuity for OneWeb, the world's only other operational LEO broadband network besides Starlink. This follows Eutelsat's earlier order for 440 new LEO satellites from Airbus, signaling a planned expansion. The deal is a direct response to geopolitical and strategic concerns, with OneWeb considered a key asset for secure government and military communications by its French and British shareholders. It also aligns with European efforts to build sovereign access to space, as highlighted by French President Emmanuel Macron's push for a stronger European space strategy.

Yet, securing launch capacity does not alter the fundamental challenge. Eutelsat is playing catch-up in a race defined by scale and deployment speed. While MaiaSpace aims for a high cadence, its first commercial flights are years away, and the company is still developing its partially reusable launcher. By contrast, SpaceX has leveraged its reusable Falcon 9 fleet for over a decade, enabling the deployment of more than 9,000 Starlink satellites. Eutelsat's planned expansion, while significant, must now compete against a network that has already captured a dominant market share. The MaiaSpace deal ensures Eutelsat can keep its constellation growing, but it does not close the gap in total satellite count or service penetration.

Market Position and Growth Trajectory: The Scale Gap

The competitive landscape is defined by a massive scale gap. Eutelsat's OneWeb constellation operates more than 600 satellites in orbit, a fraction of Starlink's fleet of over 6,750. This disparity in satellite count directly translates to a gap in service coverage and market penetration. While Eutelsat is positioning itself as Europe's answer to Starlink, the sheer head start and deployment velocity of its American rival have cemented a dominant position in the global broadband market.

Yet, the company's strategic pivot is showing clear traction in its growth driver. In the first quarter of fiscal 2025-26, revenue from its LEO segment surged 61.0% year-on-year to €54.1 million. This explosive growth, which represented a 70.7% like-for-like increase, underscores the focus and momentum behind the OneWeb initiative. It is the primary engine accelerating Eutelsat's transition from legacy businesses toward connectivity services.

This growth, however, is not yet offsetting the decline in its traditional operations. Overall, the company's total revenue declined slightly, down 2.2% on a reported basis to €293 million. More specifically, the core operating verticals saw a 1.2% year-over-year decline on a like-for-like basis. The video segment, which still represents nearly half of revenues, continues to contract, down 12.0% year-on-year. The overall picture is one of a business in transition: the LEO segment is scaling rapidly, but it is not yet large enough to fully replace the revenue from the declining legacy businesses.

The bottom line is a company navigating a painful but necessary rebalancing. The scale gap with Starlink remains immense, and the path to market share will require sustained, high-velocity growth. The 61% LEO revenue surge is a positive signal of execution, but the overall business is still contracting. For Eutelsat to close the gap, it must not only keep deploying satellites but also accelerate customer acquisition and service adoption at a rate that can eventually outpace the market leader.

Financial and Geopolitical Context: Funding the Ascent

The strategic push for European space sovereignty is backed by substantial financial muscle, but it faces immediate investor skepticism. In June 2025, the French state led a 1.35 billion euro ($1.57 billion) investment in Eutelsat, becoming its largest shareholder with a roughly 30% stake. This move underscores the company's critical role in national and European tech sovereignty ambitions. The investment provides a vital capital cushion for the costly LEO build-out, aligning Eutelsat's fortunes with a broader geopolitical imperative to reduce dependency on U.S. satellite services.

Yet, the market's reaction to this support has been negative. Shares in Eutelsat plummeted 7.2% recently after reports that Japanese investor SoftBank cut its stake in the company. This sell-off signals potential investor skepticism about the path to profitability for the OneWeb venture. The stock's performance since its 2024 surge reflects this tension: after soaring more than 600% on sovereignty fears, it has since dropped more than 70%. The SoftBank move highlights the financial risk perceived in a capital-intensive, multi-year build-out against a dominant incumbent.

This context is mirrored in a parallel European initiative. The European Commission signed a concession contract in December 2024 for the IRIS² constellation, a 290-satellite, multi-orbital system combining MEO and LEO satellites. This sovereign project aims to provide secure connectivity for government and critical infrastructure, further indicating a concerted push for space independence. For Eutelsat, this creates both a potential customer and a competitive landscape where its commercial LEO ambitions must coexist with a state-backed European alternative.

The bottom line is a company funded by strategic necessity but judged by financial returns. The French state's investment provides a crucial lifeline, but the stock's decline shows that investors are demanding a clearer, faster path to closing the scale gap with Starlink. Eutelsat's ability to capture market share will depend not just on deploying satellites, but on demonstrating that its model can generate returns in a market where the financial and geopolitical stakes are now very high.

Catalysts, Risks, and What to Watch

The path for Eutelsat to close the market share gap with Starlink hinges on a few critical, forward-looking factors. The primary catalyst is the execution of its launch schedule, which is now anchored by the MaiaSpace deal. The multi-launch agreement, set to begin in 2027, must align precisely with the planned deployment of 440 new Airbus-built LEO satellites. This timeline is crucial; any delay would extend the company's catch-up phase against a network that has already deployed over 9,000 satellites. The success of this build-out will be measured not just in satellite count, but in the pace of LEO revenue growth versus the ongoing decline in legacy businesses.

The key risk is the immense capital intensity required. The company expects gross capital expenditure in a range of €1.0-1.1 billion for the LEO build-out. This is a multi-year commitment that will pressure cash flow and financial flexibility. Investors must monitor whether the explosive 61.0% year-on-year surge in LEO revenue can sustain its momentum and eventually outpace the contraction in the video and GEO segments. The current trajectory shows the LEO engine is firing, but it is not yet large enough to fully offset the drag from the rest of the business.

Another major risk is customer acquisition in a market dominated by Starlink's scale and pricing. Eutelsat's strategy relies on securing government and military contracts, as its OneWeb constellation is considered a strategic asset for secure communications. However, commercial adoption will be challenging. The company needs to demonstrate that its service offers a compelling value proposition-whether on price, security, or coverage-that can attract users away from the incumbent leader. The recent stock sell-off following SoftBank's stake reduction highlights investor skepticism about the path to profitability in this crowded arena.

For now, the focus should be on operational milestones. Watch for the first commercial flights from MaiaSpace in 2026 and the subsequent start of launches in 2027. Simultaneously, track the quarterly LEO revenue growth rate and the company's ability to stabilize or grow its total operating verticals. The bottom line is that Eutelsat has secured a launch option and is scaling its LEO business rapidly, but the financial and execution hurdles to materially closing the market share gap remain steep.