DaveInDenver
Middle Income Semi-Redneck
SpaceX Doubles the Size of Its "Starlink" Internet Broadband Constellation | The Motley Fool
60 new satellites are now in orbit -- and another rocket is safely back on Earth.
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How to not make money in space
This second fact became painfully obvious (for SpaceX) back in 2016, when for the first time SpaceX hinted at the fact that it was losing money on its space launch business, which a Wall Street Journal investigation subsequently confirmed.
However, SpaceX seems to have righted that ship, with COO Gwynne Shotwell admitting last year that while SpaceX has lost money in some years, it's also "had many years of profitability." But even so, with the company recently cutting launch prices on its Falcon 9 rockets from their advertised "$62 million" rate to as low as $50 million, you have to figure that profit margins at the company are razor thin.
How to make money from space
SpaceX does have a solution to that, however. Over time, the company plans to leverage its low-cost-provider status as a rocket launcher to create its own network of thousands -- and perhaps tens of thousands -- of orbiting broadband satellites.
Once complete, SpaceX hopes this "Starlink" internet constellation will be able to sell internet service to consumers on Earth, earning operating profit margins for SpaceX on the order of 60%. Thus space launches become a means to an end for SpaceX, and space services will become the company's real profit driver -- eventually earning enough profits to finance a SpaceX-led colonization of Mars.
One hand washes the other
And there you have it: the two keys to understanding SpaceX's business.
