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Here's an OK article on the topic: https://archive.is/eKCJu https://archive.is/eKCJu Starlink is almost certainly playing games with capex and depreciation to

by sfblah 2mo ago

Here's an OK article on the topic: https://archive.is/eKCJu https://archive.is/eKCJu Starlink is almost certainly playing games with capex and depreciation to appear profitable when it is not. They're also using political patronage to get contracts from the government to do things that are probably worthless.

ggreer 2mo ago
The income/profit numbers I used include depreciation, and even if you subtract all space capex from Starlink income, the program would still have a profit of $482 million last quarter. That's a very pessimistic estimate, as it includes costs for many things outside of what's necessary to build Starlink satellites and put them in orbit. The post you linked to seems to be incorrect on matters of fact. For example, it claims that, "...a large portion of the Starlink constellation consists of V1 and V1.5 satellites...". But of the 9,200 operational Starlink satellites today, 8,000 are v2 minis. Over half of the older v1 and v1.5 satellites have been deorbited, so they don't seem critical to its continued operation. The post also claims that higher RAM and fuel prices will increase the cost of Starlink significantly, but neither are significant costs. It costs SpaceX around $1.4 million to construct a v2 mini and put it into orbit. Even if each satellite had 1TB of RAM, that's what, $50k at the most? And propellant is only a few percent of launch costs. The main expenses (besides satellite construction) are building second stages, refurbishing boosters, and vehicle integration. If SpaceX is lying about Starlink's profitability, then it seems like the best way to show that is to focus on the numbers. They have 9,200 operational satellites and 12 million customers, meaning each satellite serves 1,300 customers on average. ARPU is $66/month, which means each satellite earns them $86k/month, or $5 million over a 5 year life. (And this is just consumer revenue, not B2B or government contracts.) Each Falcon 9 launch puts 24-29 v2 mini satellites in orbit, so each launch gets them $120-150 million in expected revenue. So the question is: is the cost to construct the satellites, launch them, and operate the network lower than that? SpaceX charges customers $76 million for a Falcon 9 launch, but their costs are much lower. (Probably around $20 million.) Even with pessimistic cost estimates, it's hard to find a way to make Starlink unprofitable without also making things like ISS missions or GPS satellite launches unprofitable. And if that's the case, then arguing over Starlink's profitability is academic, and the real issue is that SpaceX is blatantly lying in their SEC filings. I seriously doubt that is the case.
- sfblah 2mo ago
  It doesn't require "lying," per se. It just requires hiding the truth, kind of like what Musk has done for dozens of his other ventures. You do know that SpaceX owns Twitter now, for example? You do know that he tricked his investors into giving his cousin a ton of money for his fake solar lease scheme? You do know that there's still no new roadster, something like 10 years after he accepted deposits for it? Even if we assume the numbers you're citing are right and this business is insanely profitable, won't this just invite competition? Or are you assuming the government will make SpaceX a monopoly, as it did for Tesla via neverending subsidies?
  - ggreer 2mo ago
    I'm trying to address one very specific point: Whether Starlink is profitable. I'm not trying to litigate other business practices. The development timeline for a different's company's fancy car for the super-rich is not related to whether Starlink is profitable. You can't hide the truth if you say you're following GAAP in your SEC filings, and then publish numbers saying that Starlink is making money. Doing so risks massive fines and even criminal penalties. There are at least three other companies trying to build Starlink competitors (Amazon Leo, Guowang, & Qianfan). It's difficult for them to compete because unlike SpaceX, they don't have reusable boosters. Amazon is hoping that Blue Origin's New Glenn will be able to reduce their launch costs, but until their launch facility is rebuilt, Amazon has to rely on SpaceX, ULA, and Arianespace to get their satellites into orbit. The Chinese competitors also lack reusable spacecraft (and are also working to on that problem), so their launch costs are significantly higher. In the long term, whoever has the lowest launch costs will have the lowest prices, and SpaceX is betting that by the time others have reusable boosters (similar to Falcon 9), they'll have Starship operational. Time will tell if that works out for them. When you say things like, "Or are you assuming the government will make SpaceX a monopoly, as it did for Tesla via neverending subsidies?" I'm not sure how to respond. First, SpaceX is practically a monopoly because their launch costs are so much lower than the competition. They were responsible for approximately 80% of all mass put in orbit in 2025 (over 2,400 tons). They needed subsidies and government contracts when the company started, but that is no longer their main source of revenue. Second, I don't see how Tesla is a monopoly (there are many competing car companies), nor how they're significantly subsidized compared to other US car manufacturers. How much in subsidies do you think Tesla has gotten compared to their revenue over the years, and how do you think that compares to say, Ford?
inemesitaffia 1mo ago
Will is an idiot. You can tell by reading SpaceX IPO docs

by sfblah 2mo ago

ggreer 2mo ago

The income/profit numbers I used include depreciation, and even if you subtract all space capex from Starlink income, the program would still have a profit of $482 million last quarter. That's a very pessimistic estimate, as it includes costs for many things outside of what's necessary to build Starlink satellites and put them in orbit. The post you linked to seems to be incorrect on matters of fact. For example, it claims that, "...a large portion of the Starlink constellation consists of V1 and V1.5 satellites...". But of the 9,200 operational Starlink satellites today, 8,000 are v2 minis. Over half of the older v1 and v1.5 satellites have been deorbited, so they don't seem critical to its continued operation. The post also claims that higher RAM and fuel prices will increase the cost of Starlink significantly, but neither are significant costs. It costs SpaceX around $1.4 million to construct a v2 mini and put it into orbit. Even if each satellite had 1TB of RAM, that's what, $50k at the most? And propellant is only a few percent of launch costs. The main expenses (besides satellite construction) are building second stages, refurbishing boosters, and vehicle integration. If SpaceX is lying about Starlink's profitability, then it seems like the best way to show that is to focus on the numbers. They have 9,200 operational satellites and 12 million customers, meaning each satellite serves 1,300 customers on average. ARPU is $66/month, which means each satellite earns them $86k/month, or $5 million over a 5 year life. (And this is just consumer revenue, not B2B or government contracts.) Each Falcon 9 launch puts 24-29 v2 mini satellites in orbit, so each launch gets them $120-150 million in expected revenue. So the question is: is the cost to construct the satellites, launch them, and operate the network lower than that? SpaceX charges customers $76 million for a Falcon 9 launch, but their costs are much lower. (Probably around $20 million.) Even with pessimistic cost estimates, it's hard to find a way to make Starlink unprofitable without also making things like ISS missions or GPS satellite launches unprofitable. And if that's the case, then arguing over Starlink's profitability is academic, and the real issue is that SpaceX is blatantly lying in their SEC filings. I seriously doubt that is the case.

sfblah 2mo ago
It doesn't require "lying," per se. It just requires hiding the truth, kind of like what Musk has done for dozens of his other ventures. You do know that SpaceX owns Twitter now, for example? You do know that he tricked his investors into giving his cousin a ton of money for his fake solar lease scheme? You do know that there's still no new roadster, something like 10 years after he accepted deposits for it? Even if we assume the numbers you're citing are right and this business is insanely profitable, won't this just invite competition? Or are you assuming the government will make SpaceX a monopoly, as it did for Tesla via neverending subsidies?
- ggreer 2mo ago
  I'm trying to address one very specific point: Whether Starlink is profitable. I'm not trying to litigate other business practices. The development timeline for a different's company's fancy car for the super-rich is not related to whether Starlink is profitable. You can't hide the truth if you say you're following GAAP in your SEC filings, and then publish numbers saying that Starlink is making money. Doing so risks massive fines and even criminal penalties. There are at least three other companies trying to build Starlink competitors (Amazon Leo, Guowang, & Qianfan). It's difficult for them to compete because unlike SpaceX, they don't have reusable boosters. Amazon is hoping that Blue Origin's New Glenn will be able to reduce their launch costs, but until their launch facility is rebuilt, Amazon has to rely on SpaceX, ULA, and Arianespace to get their satellites into orbit. The Chinese competitors also lack reusable spacecraft (and are also working to on that problem), so their launch costs are significantly higher. In the long term, whoever has the lowest launch costs will have the lowest prices, and SpaceX is betting that by the time others have reusable boosters (similar to Falcon 9), they'll have Starship operational. Time will tell if that works out for them. When you say things like, "Or are you assuming the government will make SpaceX a monopoly, as it did for Tesla via neverending subsidies?" I'm not sure how to respond. First, SpaceX is practically a monopoly because their launch costs are so much lower than the competition. They were responsible for approximately 80% of all mass put in orbit in 2025 (over 2,400 tons). They needed subsidies and government contracts when the company started, but that is no longer their main source of revenue. Second, I don't see how Tesla is a monopoly (there are many competing car companies), nor how they're significantly subsidized compared to other US car manufacturers. How much in subsidies do you think Tesla has gotten compared to their revenue over the years, and how do you think that compares to say, Ford?

inemesitaffia 1mo ago

Will is an idiot. You can tell by reading SpaceX IPO docs