Shooting for the stars... and missing.
Missing the Mark
With its impressive constellation of satellites, Starlink has become somewhat of a household name in spite of its relatively niche market. That hasn't saved it, however, from its numbers coming up drastically short of internal projections, the Wall Street Journal reports.
Starlink, a division of Elon Musk's SpaceX, reported a revenue of $1.4 billion for 2022. That's respectable on its own, but a far cry from what the company expected to be raking in by now.
According to a 2015 presentation obtained by the WSJ, SpaceX projected that Starlink would generate nearly $12 billion in revenue and $7 billion in profit in 2022. By 2025, it hoped to clear $30 billion — which now seems laughable.
Similarly, the actual size of its user base pales in comparison to its early projections. The plan in 2015 was that Starlink would have 20 million subscribers to its satellite based internet service by the end of last year, but in reality it only hit one million.
Whether those massive discrepancies are simply a symptom of Musk's signature overly ambitious timelines rather than the performance actually being that bad is up for debate, but clearly the company isn't anywhere near where it'd hoped to be by now.
Currently, the division's exact profitability remains unclear, and was not disclosed in the obtained documents. On the upside, Starlink reported marginal profits for the first three months of 2022, the WSJ reported. A small victory, nonetheless, amidst an overall loss for the year.
A big reason for why profits remain elusive is that SpaceX is blowing hefty chunks of change in upkeep, spending $3.2 billion in capital expenditures that year, according to the documents.
That spending, paired with day-to-day operating costs, is sure to be a huge dent in anyone's wallet, let alone for a company that is over 18 million short in expected customers.
Recent bad press is certainly no boon going forward, either, with Musk admitting last week that he manipulated Starlink to sabotage a Ukraine military attack on Russia's naval fleet in Crimea.
King of the Competition
At the very least, Starlink's revenue still enjoyed a healthy climb last year, up $222 million from the year before, and recently announced that it's no longer losing money on producing its satellite antennas.
Furthermore, the Musk-led venture can safely say that it's head and shoulders above its competitors like Amazon, who are still scrambling to deploy its own low Earth orbit satellites.
This is where SpaceX enjoys a considerable advantage: as the world's foremost launch provider, it has plenty of rockets available to send up its own satellites as often as it wants, without having to depend on third parties.
Even that advantage has a caveat, though: in a leaked email two years ago, Musk warned that if SpaceX can't get Starship off the ground as a next-gen launch vehicle for future Starlink satellites, it could put the entirety of SpaceX in danger of bankruptcy.
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