When analysts and investors talk about a potential SpaceX (SPAX.PVT) IPO — likely to happen sometime this summer at the earliest — they are, in large part, talking about Starlink.
The satellite internet service has grown from an engineering project into the dominant revenue machine, supercharging the world’s most valuable private company.
Read more: SpaceX: How to buy before the IPO
Despite a recent report suggesting SpaceX lost $5 billion last year, that loss was due to its heavy investments in xAI.
SpaceX’s core rocket launch business and, more importantly, its Starlink satellite service earned around $6 billion in earnings before interest, taxes, depreciation, and amortization (EBITDA).
Examining Starlink, looking at its business model and how it intends to grow is key to the SpaceX story. Add it all together, and it makes SpaceX the most anticipated offering of all time, with its sheer size dwarfing all others at an estimated valuation of $2 trillion.
A Starlink satellite broadband antenna from SpaceX is on sale in the computer department of a Fnac store in the Victor Hugo shopping center in Valence, France, on March 8, 2025. (Nicolas Guyonnet/AFP via Getty Images) ·NICOLAS GUYONNET via Getty Images
At its core, Starlink is a broadband internet service delivered from space, a global service that reaches more than 9 million customers across residential, business, and government segments, with plans to expand even further.
Currently, the service is “a low-latency, broadband internet system delivered via a constellation of thousands of LEO satellites” that “extends SpaceX’s advantage by vertically integrating the full loop — design, manufacturing, and operation — at unprecedented scale,” according to a recent report from PitchBook about the importance of SpaceX and Starlink.
The result is a system unlike anything previously built: global, fast, and almost entirely controlled end to end by a single private company.
Rather than relying on ground-based fiber or cell towers, Starlink uses a constellation of satellites in low earth orbit (LEO) — just 340 to 750 miles above the surface — to beam high-speed internet directly to small, self-installing dishes on the ground. Because LEO satellites are much closer to Earth than traditional geostationary satellites (which orbit at 22,000 miles), Starlink says the signals travel far shorter distances, reducing latency to 25 milliseconds, comparable to many wired broadband connections.
The scale of the Starlink satellite constellation is massive. PitchBook noted that the constellation comprises more than 9,600 operational satellites, accounting for about two-thirds of the 14,300 active payload satellites globally.
Starlink’s newer gigabit V3 satellite shown in comparison to its other satellites. ·SpaceX
SpaceX has built and launched more active satellites than every other space program and company combined — and it continues adding to the constellation at a rate of roughly 70 satellites per week.
“Scale is the point,” PitchBook analysts wrote, noting building satellites at that rate resembles industrial production more than a “traditional aerospace cadence.”
And that scale is also part of the customer hardware experience. SpaceX says it intends to produce approximately 15,000 Starlink kits per day, with plans to expand manufacturing and bring more processes in-house.
“These numbers matter,” PitchBook noted, “because they support a fundamentally different cost curve: volume manufacturing accelerates learning, improves yields, and increases bargaining power.”
Starlink’s mobile app is seen on an iPhone. ·Jake Conley/Yahoo Finance
Starlink’s product portfolio has expanded well beyond consumer broadband.
PitchBook categorizes the service across three principal areas: commercial connectivity (residential, business, maritime, and aviation), Starshield (a “specialized government-focused product line leveraging Starlink technology for national security use cases, including secure communications and Earth observation”), and direct to cell — “an emerging connectivity service (in partnership with carriers like T-Mobile) designed to provide text and voice coverage to unmodified LTE cell phones.”
To build out its subscriber base — more than 9 million global subscribers at the moment, with 4.6 million added last year alone — Starlink is getting innovative with consumer deals.
Case in point: Starlink’s deal last week with prepaid carrier US Mobile, which will offer bundles for new and existing customers, including residential Starlink, for as low as $47 per month.
The deal with US Mobile is curious, as most carriers are loath to make deals with SpaceX because they could threaten their mobile businesses.
And that threat is apparent in Starlink’s new direct-to-cell (DTC) service, which provides internet access via satellites to regular, unmodified mobile phones. PitchBook reported that the DTC offering already serves “over 6 million monthly subscribers and 12 million people connected at least once” — and that is before a full commercial rollout.
How Starlink’s direct-to-cell (or device) service works. ·Pitchbook via SpaceX
By partnering with existing mobile carriers rather than displacing them, Starlink adds a new revenue layer with potentially enormous scale — effectively, every mobile subscriber represents a potential coverage-extension customer.
And this, of course, is a big part of the business case when valuing a SpaceX IPO.
Because SpaceX is still private, investors and analysts need to look to external data sources to gauge how the business performs.
Starlink generated an estimated $10.6 billion in revenue in 2025 — approximately 67% of SpaceX’s total of $15.8 billion — with EBITDA of $5.8 billion, representing a 54% EBITDA margin, per PitchBook.
The Information reported similar numbers. The SpaceX core business (Starlink, rocket launches) generated around $6 billion in EBITDA last year, though total company revenue came in higher at $18.5 billion.
Starlink’s margins are closer to those of a software provider than to a traditional tech hardware business and reflect the core economics of the model: Once the constellation is in orbit, each incremental subscriber adds high-margin recurring revenue with near-zero marginal cost.
Subscriber growth is showing momentum. Starlink reached more than 9 million subscribers in more than 155 countries by the end of 2025, doubling its base for two consecutive years. Analysts and investors likely expect another big surge of customers, and Starlink’s recent deal with US Mobile may accomplish that.
US Mobile’s Starlink bundle plans released on Thursday. ·US Mobile
For IPO investors, this combination of recurring subscription revenue, expanding margins, multivertical growth, and a massive cost advantage due to its parent company’s ability to launch rockets cheaply is the play.
As PitchBook put it, Starlink “creates recurring internal demand that justifies large-scale capital expenditure, and it forces SpaceX to behave like a high-volume manufacturer rather than a bespoke aerospace producer.”
A SpaceX IPO would be, in substance, almost a Starlink IPO — an opportunity to invest in the world’s largest and fastest-growing satellite internet business, backed by the only launch provider capable of replenishing and expanding a 9,600-satellite constellation at industrial scale.
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Pras Subramanian is the Lead Transportation Reporter for Yahoo Finance. You can follow him on X and on Instagram.
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