Shares of AST SpaceMobile (ASTS 10.60%) jumped on Wednesday, finishing the day up 10.6%. The spike came as the S&P 500 and Nasdaq Composite were relatively flat. The satellite communications company announced a new partnership with a massive telecom provider in India.
A major new partnership for AST SpaceMobile
AST SpaceMobile announced a strategic partnership with Vodafone Idea (Vi), an Indian telecom giant with over 1.1 billion mobile subscribers. The deal will combine Vodafone's land-based network with AST's satellite-based technology to connect underserved regions using regular smartphones.
A major opportunity
India represents a massive growth market with a huge population and a significant number of underserved customers in remote regions. AST's space-based system makes it possible for these populations to access Vodafone's network. The deal is a major opportunity and marks another validation of its technology.
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AST SpaceMobile is growing
This comes just weeks after Jeff Bezos visited the company's headquarters in Texas. The Amazon founder's presence set off a firestorm of rumors about an increased partnership between his space company, Blue Origin, and AST.
It seems things are going well for the satellite maker. AST's vision for the future of broadband access is compelling. It's not hard to see the value it can provide. Investors should be aware of the cost of building out its network, despite its recent successes. There is a risk of dilution as the company finances its network. But for those with a high risk tolerance and a longer time horizon, I think AST SpaceMobile is a good pick.
