Sealand Securities Co.,Ltd. (000750) has released a research report stating that it initiates coverage and assigns a "Recommended" rating to the satellite internet terminal and application industry.
Currently, China's domestic low-earth-orbit satellite internet remains in the early industrialization stage, with constellation deployment, terminal finalization, ground network construction, and application verification advancing simultaneously, leaving considerable room for growth before full-scale commercial operation is achieved.
On the demand side, satellite internet can fill coverage gaps left by ground networks in scenarios such as maritime, aviation, emergency response, energy, transportation, remote areas, and mass mobile communications, with broadband terminals, narrowband specialized terminals, direct-to-cell connectivity, ground stations, and core chips all possessing differentiated demand and substantial potential market space.
As network coverage and capacity continue to improve, terminal costs decline, and business licenses and commercial models gradually mature, the industry is expected to progressively move from its current small-batch trial verification stage toward large-scale procurement and commercial operation, with revenue elasticity on the terminal and application side expected to be continuously released.
Key Points from Sealand Securities Co.,Ltd.
Global Satellite Broadband Market Growing Rapidly, Connectivity Has Become SpaceX's Primary Revenue and Profit Source
According to a report published by the Satellite Industry Association (SIA) in May 2026, global satellite broadband subscriptions grew 62% year-on-year in 2025, exceeding 10 million lines, while satellite broadband revenue grew approximately 16% year-on-year.
Starlink, leveraging continuous constellation deployment and commercial service expansion, saw Connectivity revenue reach US$11.387 billion in 2025, up 49.85% year-on-year, accounting for 60.98% of SpaceX's total revenue; segment operating profit reached US$4.423 billion, up 120.49% year-on-year.
In the first half of 2026, Connectivity further achieved revenue of US$7.548 billion and operating profit of US$2.844 billion.
Satellite internet is gradually evolving from an investment phase dominated by network construction toward a large-scale commercial business centered on connectivity services.
Starlink Advances Constellation Deployment and Commercial Applications in Tandem, Terminal Demand Does Not Need to Wait for Full Constellation Completion
Starlink began satellite deployment in 2019 and commenced commercial operations in 2020.
From 2023 to 2025, the number of satellites in orbit increased from 5,248 to 9,391, a growth of 78.94%; during the same period, subscription service lines grew from 2.3 million to 8.9 million (definition of subscription service lines: SpaceX counts users by independent subscription service lines at period end, typically associated with one or a group of terminals, covering residential, roaming, and commercial subscription packages, but excluding separately contracted managed enterprise and government customers; one line can be shared by multiple people, and the same customer can also subscribe to multiple lines), a growth of 287.0%.
As of Q2 2026, broadband and Mobile satellites in orbit exceeded 10,200, and subscription service lines reached 12 million.
Starlink's development demonstrates that once a constellation has certain regional coverage, available capacity, ground network, and business access conditions, commercial services can gradually be launched, with user and terminal deployment continuously expanding as subsequent constellation deployment progresses.
Professional Market Growth Significantly Faster Than Consumer Market, High-Value Applications in Aviation and Maritime Continue to Expand
In 2025, Starlink Enterprise & Government revenue reached US$4.179 billion, accounting for 36.7% of Connectivity revenue; in Q2 2026, revenue reached US$1.806 billion, up 108.3% year-on-year, significantly higher than the 44.39% growth rate of the Consumer business during the same period.
In 2025, more than 1,400 commercial aircraft completed Starlink equipment installation, maritime business connected over 150,000 vessels, and further expansion was made into scenarios such as agriculture, energy, government-enterprise, and government emergency communications.
The professional market has higher requirements for terminal performance, reliability, and mobile communication capabilities, with terminal prices and service value significantly higher than consumer-grade products, and is expected to become an important growth direction for satellite broadband commercialization.
Low-Earth-Orbit Satellite Terminal Market Expected to Grow Rapidly, Demand for Terminal Manufacturing and Core Components Continues to Expand
According to Global Market Insights forecasts, the global low-earth-orbit satellite terminal market is expected to grow from US$9 billion in 2025 to US$35.1 billion in 2035, with a compound annual growth rate of approximately 13.9% from 2026 to 2035; broadband terminals accounted for 64.5% in 2025, corresponding to a market size of approximately US$5.8 billion, and are expected to maintain an 11.5% compound annual growth rate through 2035.
STMicroelectronics estimates that the global serviceable market for low-earth-orbit broadband electronic components will grow from US$650 million in 2025 to US$2.9 billion in 2030, covering spaceborne, gateway, and user terminal segments.
Starlink has taken the lead in achieving large-scale terminal manufacturing, producing and selling 3.9 million customer devices in 2024.
As low-earth-orbit constellations continue to deploy and broadband applications expand, new terminal deployments, professional customer procurement, and existing equipment upgrades are expected to drive continued market growth, with demand for core components such as phased-array RF chips, beamforming, and baseband expected to expand in tandem.
Terminal Large-Scale Manufacturing Capability Continues to Improve, Phased-Array and Core Chips Constitute Important Value Segments
Starlink terminals have achieved large-scale production, producing and selling 3.9 million customer devices in 2024; in the first half of 2026, SpaceX product revenue reached US$841 million, all attributable to the Connectivity business.
Terminal value is mainly concentrated in semiconductors and phased-array-related electronic systems. A teardown of the early Starlink Internet Kit by TechInsights shows that integrated circuits account for 57.01% of the manufacturing cost of the entire device; domestic industry estimates show that for some ground-based phased-array terminals, T/R chip costs can account for approximately 40% of the complete unit.
SpaceX has continuously reduced costs through custom chips, hardware integration, and large-scale manufacturing. As of the end of March 2026, the average manufacturing cost of the Starlink Kit had decreased by approximately 59% compared to 2022.
As terminal costs decline and application scale expands, core segments such as phased-array RF chips, beamforming, baseband processing, and high-frequency boards are expected to continue benefiting, with chip integration, mass production yield, and cost control capabilities becoming key to competition in the industry chain.
Risk Warnings: Constellation deployment and launch progress falling short of expectations; regional continuous service and network capacity falling short of expectations; terminal cost reduction and core chip industrialization falling short of expectations; industry demand growth falling short of expectations; changes in business licenses, frequency-orbit coordination, and regulatory policies; intensified industry competition and decline in SpaceX's market share; large capital investment in constellations with long return cycles, and domestic business models not yet fully verified.
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