Starlink, an Elon Musk-owned satellite internet constellation that provides coverage to over 60 countries, is reported to have made $1.4 billion in revenue in 2022, up from $222 million in 2021, but however fell short of the $7 billion projection.
According to a report from Wall Street, the revenue which was a significant increase from 2021, however, fell short of Musk’s projections during a 2015 presentation to investors.
The Wall Street wrote,
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“Starlink is bumping up against a reality articulated by many skeptics of satellite Internet. The majority of the world’s population that the business could serve and that can afford high-speed broadband lives in cities. In those regions, Internet service is readily available, usually offers cheaper monthly costs than Starlink, and doesn’t require specialized equipment”.
According to WSJ, Musk who is known for his aggressive goal setting as he did with the 2015 projections, has however stated a more modest ambition for Starlink, pointing out that low-earth orbit satellite ventures have a history of going bankrupt.
SpaceX president and COO Gwynne Shotwell said in February that Starlink is expected to turn a profit this year. While Starlink’s profit or loss for the year 2023 remains unknown, the company recorded significant profits in the first three months of this year after two annual losses.
SpaceX’s first quarter (Q1) 2023 numbers reportedly included a $55 million profit on $1.5 billion in revenue.
Starlink subscriber numbers are up since 2022, but not by a huge amount. SpaceX reported that the satellite internet constellation had about 1.5 million users in May 2023.
Reports reveal that Starlink has been slower to sign up customers than Musk expected, signing up roughly one million active subscribers by the end of 2022, a major decline from the 20 million subscribers Musk expected to have.
According to McKinsey & Company, the uptake of satellite internet has been limited for various reasons. Among those reasons, two major reasons are high costs and poor performance.
However, Starlink has addressed performance issues by using a low Earth orbit satellite constellation. It has also managed hardware costs by slashing the prices of Starlink terminals.
On a step forward on profitability, SpaceX’s Vice President of Starlink Jonathan Hofeller announced that the company was no longer losing money producing Starlink terminals. He further noted that mass-producing Starlink terminals was one of the internet provider’s keys to success.
Starlink currently boasts the largest network of low-Earth orbit (LEO) broadband satellites, with over 4,700 satellites in orbit. This technical feat has allowed the company to provide high-speed internet to remote areas where traditional cable or fiber is unavailable.
The satellite internet constellation has entered the European market and demonstrated the technology’s promise while previously raising its support for Ukraine’s telecommunications needs, during the Russian invasion.
Unlike conventional internet providers, which rely on hundreds of miles of cabling, Starlink uses a constellation of low-orbit satellites to provide the world with high-speed internet access.
Starlink’s service has continued to spread across the globe, as it now covers many of the countries with the lowest internet adoption rates.
The satellite internet ambition is to penetrate mobile dead zones, which has driven much of its work and has grown its subscriber base.