Starlink’s growth vs. investor expectations
SpaceX is seeking a valuation of up to $2 trillion for a June 12 IPO. The company’s S-1 filing shows Starlink, the broadband division of SpaceX, has become the main driver of revenue and profitability.1
The Connectivity segment, which includes Starlink, generated $11.4 billion in revenue in 2025 and $3.3 billion in the first quarter of 2026, while already delivering strong operating margins. SpaceX estimates the total addressable market (TAM) for Connectivity at around $1.6 trillion, including roughly $870 billion for fixed broadband and $740 billion for mobile services.
In this article, we focus on Starlink and what Third Bridge experts are saying about its growth potential and competitive position.
Broadband: Is Starlink ready to win with enterprises?
SpaceX’s S-1 filing suggests that residential broadband remains the core cash engine of the company, supported by rapid subscriber growth and expanding international coverage.
As of 31 March 2026, Starlink had approximately 10.3 million subscribers across 164 countries, territories and other markets. However, one expert warns that there may be a natural ceiling to residential subscriber growth. According to a recent expert interview in the Third Bridge Library:
"If you believe it will just remain a rural or remote product, it seems that 20 million or 30 million total consumers globally is feasible, but they might struggle to get beyond that. Especially with new market entrants like Amazon Leo and other folks on the direct-to-cell side, [the question is] are they able to get beyond just this initial rural product, maybe some enterprise products to something grander than that? I think that's the big bet here."
2026/05/07 - SpaceX – Can Starlink Grow Fast Enough to Support Its Massive Valuation Target?
Another expert echoed this view via Expert Commentary and believes this limit can only be surpassed through major technological leaps that rival terrestrial fibre in both throughput and cost per bit.
To justify Starlink’s estimated $870 billionTAM for fixed broadband, future growth may increasingly depend on higher-margin enterprise segments such as aviation, maritime, and corporate connectivity. However, the company recently had a setback in this segment, with Amazon Leo winning a major in-flight connectivity contract with Delta.2 Although Amazon Leo has recently demonstrated its ability to challenge Starlink, it has yet to launch commercial service and may have suffered a major setback in scaling its network after its launch contractor, Blue Origin, experienced a major explosion involving one of its New Glenn rockets last week.3
Our experts say that, despite Starlink’s “superior” speeds and capacity, a key weakness is SpaceX’s reluctance to offer formal service level agreements and guaranteed bandwidth commitments that large corporate customers often require. Competitors are increasingly using this gap to target airlines, shipping companies, and enterprise customers that prioritise reliability guarantees alongside performance.
Looking further ahead, the biggest investor question may be the unproven status of the Starship launch vehicle, which is the only platform capable of carrying the significantly larger V3 satellites required to scale the network.
According to a recent expert interview in the Third Bridge Library:
"I'd say the predominant risk here is the Starship being able to actually successfully launch these things and be reusable. That, to me, is the greatest risk. It's not yet a proven launch vehicle and V3s can't fit in the existing launch vehicles in the Falcon 9 and the Falcon Heavy... The alternative reality is Starlink becomes competitive with fibre to some extent. That's betting on V3 satellites... The launch is a bigger risk [than actual satellite manufacturing]."
2026/05/07 - SpaceX – Can Starlink Grow Fast Enough to Support Its Massive Valuation Target?
If Starship launches successfully and V3 satellites are deployed at scale, it could significantly improve Starlink’s network capacity, speeds and coverage. For investors, this would strengthen the long-term view that Starlink can grow beyond a niche broadband provider into a much larger global communications platform with greater revenue potential over time, especially as experts believe Starlink’s broadband network is showing signs of capacity constraint.
Relevant transcript:
2026/05/07 - SpaceX – Can Starlink Grow Fast Enough to Support Its Massive Valuation Target?
2025/08/21 - Starlink – Enterprise Focus & Growth Outlook
2026/03/02 - Satellite Communications Sector Update – Potential SpaceX IPO & Another Well-capitalised LEO Entrant
D2D Connectivity: How big will the direct-to-device market actually be, and how much of it will Starlink win?
Starlink has also been eyeing the larger direct-to-device (D2D) market for growth. Unlike fixed broadband, D2D significantly expands the addressable market by targeting essentially all smartphone users, including those experiencing intermittent coverage gaps. While this market is still materializing, Starlink has a sizable head start on competitors, and the market broadly estimates a potential D2D TAM of $20–30bn by 2030.4
Third Bridge experts we spoke to push back on the large TAM figures, regardless of how market share ultimately plays out, citing inefficiencies compared with traditional cellular infrastructure and spectrum limitations.
The satellite spectrum battle is heating up, with experts describing spectrum as the scarcest resource and unlikely to be sufficient to support demand over the next 3–5 years. SpaceX’s acquisition of EchoStar spectrum and Amazon’s proposed Globalstar deal add further competition in the space, which could pressure pricing and shift market share once services are launched.
However, one expert says growth may take longer to materialise than it appears on paper.
As highlighted in a recent expert interview in the Third Bridge Library: “While EchoStar’s spectrum is seen as a growth driver, much of it is not yet usable on handsets today and will take another 2–4 years before current phones can access it. Today, they remain reliant on MNO partnerships and existing spectrum, and regulatory frameworks vary by country, meaning spectrum ownership does not translate into immediate growth.”
“Residential broadband and enterprise broadband will continue to be the main drivers of revenue for the foreseeable future. Like you mentioned, there is limited applicability to direct-to-device, especially in more developed markets. Where I see that thesis slightly changing is in areas with significantly less access to cell towers and terrestrial fibre — less developed countries — where there may be more value from a direct-to-device service offering.” ”
2026/05/07 - SpaceX – Can Starlink Grow Fast Enough to Support Its Massive Valuation Target?
Relevant transcript:
2026/04/22 - SpaceX – Sizing Starlink's Direct-to-device Opportunity Ahead of a Potential Massive IPO
2025/09/18 - Starlink – Acquisition of EchoStar Spectrum & Impacts Across the Telco Sector
2025/06/23 - SpaceX, EchoStar & FCC – Spectrum Dispute Overview & Outcomes
2025/06/17 - EchoStar – SpaceX Dispute, Missed Interest Payments & AWS-4 Spectrum Usage Scrutiny by the FCC
Conclusion
For now and in the foreseeable future, consumer and enterprise broadband are likely to remain the primary cash cow for Starlink and SpaceX, and the main battleground with Amazon’s Project Kuiper. The D2D market remains more uncertain and a longer-term opportunity, offering significant upside but still in its early stages of development. The world will also be watching the successful launch of Starship and what it could unlock for the next era of space development.
All insights in this article are based on information provided by Third Bridge experts.
For media inquiries, please contact: comms@thirdbridge.com
References:
1. https://www.sec.gov/Archives/edgar/data/1181412/000162828026036936/spaceexplorationtechnologi.htm
3. https://www.ft.com/content/11b2eb12-6623-4624-83a6-5d25c905f3e6?syn-25a6b1a6=1
