AST SpaceMobile Joint Venture With Rakuten

AST SpaceMobile announced a joint venture with Rakuten on Nov. 9, 2026, to form Rakuten AST, a Japan-focused direct-to-device satellite network using low-Earth-orbit (LEO) satellites and commercially available smartphones. The announcement coincided with AST’s third-quarter revenue report, which showed strong year-over-year growth but fell short of consensus estimates.

Japan Joint Venture Terms and Strategic Outlook

Rakuten Group and AST agreed on Nov. 6, Japan Standard Time, to establish Rakuten AST, a joint venture that Rakuten will control with a majority of voting rights, while an AST SpaceMobile Japanese subsidiary holds the remainder. The venture aims to build and operate a domestic mobile network extending connectivity to areas with poor terrestrial coverage and supporting communications during disasters.

Rakuten AST will collaborate with AST on satellites compatible with mid-band spectrum and targets launching domestic operations by the end of March 2029. The project is linked to Japan’s J-LEO initiative, which is expected to provide up to ¥148 billion (about $1 billion) in government support over roughly three years. Industry reports indicate an initial capitalization of ¥100 million.

This partnership gives AST a local operating partner with majority control and ties the project to substantial public backing, clarifying its commercial path into Japan amid ongoing efforts to expand its satellite constellation.

Third-Quarter Results and Financial Outlook

AST SpaceMobile reported third-quarter revenue of $42.3 million for the period ended Sept. 30, 2026, up from $14.7 million a year earlier. The company attributed the increase primarily to commercial gateway deliveries and U.S. government service milestones. However, the results fell short of consensus estimates, which projected $47.94 million in revenue and a $0.40-per-share loss.

Net loss attributable to common stockholders widened to $132.4 million from $122.9 million in the prior year, with total operating expenses of $211.0 million, including depreciation, amortization, and stock-based compensation. For the nine months ended Sept. 30, 2026, revenue rose to $88.6 million from $16.6 million, while net loss expanded to $554.3 million from $268.0 million. Cash and equivalents totaled approximately $3.2 billion at quarter-end.

AST reiterated its full-year 2026 revenue guidance of $150 million to $200 million, citing potential upside from recently signed contracts and milestone completions. Management aims for intermittent initial satellite coverage by year-end 2026 in the U.S. and other key markets, including Canada, Japan, Saudi Arabia, and the U.K. The company targets about 45 BlueBird satellites in orbit by mid-2027.

Production plans remain aggressive, with a goal of six ASIC-enabled satellite completions per month starting December 2026. Existing launch agreements cover more than 100 BlueBird deployments in 2027 and 2028. The estimated average direct-material and launch cost for a constellation of over 90 Block-2 satellites is $21 million to $23 million per satellite, with initial launches expected to cost more.

The combination of the Rakuten partnership and AST’s reiterated guidance frames near-term commercialization prospects in Asia, while investors weigh the company’s ability to meet expectations amid the quarter’s shortfall.

“Using low Earth orbit (LEO) satellites” will enable the venture’s direct-to-device network, according to the joint-venture announcement.