Amazon (AMZN) successfully launched its first batch of 27 operational Kuiper satellites yesterday, just ahead of its first quarter Fiscal 2025 results set for Thursday. Project Kuiper had faced multiple delays due to slower satellite development and unfavorable weather. Analysts had even started doubting if Amazon would be able to deliver Project Kuiper in 2025 at all. However, this successful launch marks Amazon’s official entry into the multi-billion-dollar satellite internet market.
Amazon Competes with Musk’s Starlink
Project Kuiper is established to offer broadband internet services through a constellation of low-Earth orbit (LEO) satellites. The company seeks to deliver fast and reliable internet connectivity worldwide, particularly to the unserved and underserved regions. As part of its $10 billion initiative, Amazon intends to send 3,200 LEO satellites and has partnered with United Launch Alliance (ULA) for satellite deployment. The first operational satellite, Kuiper 1, was launched aboard ULA’s Atlas V rocket from Cape Canaveral Space Force Station in Florida at 7 p.m. EDT on Monday, April 28.
The long-awaited launch positions Amazon to challenge rival Elon Musk’s Starlink satellite services, which has already deployed over 8,000 satellites since its first successful launch in 2019. Moreover, Starlink now serves over 5 million users across 125 countries, making it a formidable player in the satellite broadband market. Meanwhile, Amazon is under pressure from the U.S. Federal Communications Commission (FCC) to launch at least 1,618 satellites by July 2026. Amazon can begin serving customers later this year, if it successfully deploys 578 operational satellites to the LEO. The initial service will target certain northern and southern regions, with wider expansion planned in a phased manner.
Analysts Weigh In on Amazon’s Q1 Results
In April alone, AMZN stock received 29 “Buy” ratings and only one “Hold” rating from Wall Street analysts, reflecting strong optimism ahead of its Q1 results. The Street expects Amazon.com to report diluted earnings per share (EPS) of $1.37, significantly higher than $0.98 reported in Q1FY24. Similarly, according to data from TipRanks’ Forecast Page, the consensus for Q1 sales is pegged at $155.14 billion, reflecting an 8.2% surge over the prior year period.
Overall, AMZN stock commands a Strong Buy consensus rating on TipRanks. This is based on 46 Buys and one Hold rating received during the past three months. Also, the average Amazon.com price target of $245.77 implies 30.9% upside potential from current levels. Year-to-date, AMZN stock has lost 14.4%.
