 "Amid US-Ukraine tensions, Starlink's European rival sees shares soar 500%")
Shares of French satellite operator Eutelsat have surged more than 500 per cent in the past week. This comes amid tensions between the United States and Ukraine, following a confrontation in the Oval Office between Presidents Donald Trump and Volodymyr Zelenskyy last month. As European nations begin to look for alternatives to US and American firms, speculation that Eutelsat could play a crucial role in providing satellite internet services to Ukraine have driven investor optimism.
Eutelsat's shares skyrocket
Eutelsat's stock saw extreme volatility over the last week, CNBC reported, jumping 77 per cent on March 4 and another 120 per cent the next day. By Monday afternoon, shares had risen another 22 per cent in Paris trading.
The stock was trading at approximately1.20 euros on February 28, 2025, closed Tuesday's trading session at 7.51 euros, marking an increase of over 500 per cent.
On March 7, Goldman Sachs revised its outlook for Eutelsat stock from 'sell' to 'neutral', stating that they had "underestimated the upside risk from government support", Reuters reported.
What is Eutelsat and why are its shares skyrocketing?
Eutelsat is a French satellite operator that provides telecommunications and broadcast services globally. The company was founded in 1977 and has its headquarters in Paris. The company is one of the world's leading satellite communications companies, operating a fleet of geostationary and low Earth orbit (LEO) satellites. Eutelsat’s subsidiary, OneWeb, competes directly with Elon Musk’s Starlink.
The rally comes amid growing uncertainty over Starlink’s involvement in Ukraine’s war effort. Reports suggest European officials are considering alternative providers, with Eutelsat emerging as a key contender.
Last week, Eutelsat, the world’s third-largest satellite operator by revenue, confirmed ongoing discussions with the European Union (EU) about expanding internet access in Ukraine. This news led to the sudden jump in the company's shares.
Can Eutelsat replace Starlink?
Eutelsat has the infrastructure to expand its role in Ukraine. The company operates a fleet of 35 geostationary orbit (GEO) satellites and a LEO constellation of more than 600 satellites. The firm’s technology, combined with EU support, could potentially provide Ukraine with an alternative satellite network, reducing reliance on Starlink.
“Everyone is asking us today, ‘Can you replace the large number of terminals of Starlink in Ukraine?’ and we are looking at that,” Eutelsat CEO Eva Berneke told Bloomberg in an interview last week.
Starlink has been a critical component of Ukraine’s battlefield communications since Russia’s invasion in 2022. Starlink provides Ukrainian troops with internet connectivity for drone operations, secure messaging, and real-time coordination. However, recent political tensions between the United States and the EU have cast doubt on Starlink’s future role. The EU is also planning to grant Ukraine access to its GovSatCom satellite network, a secure system managed by European member states.
US-Ukraine political disputes and Starlink
Concerns over Starlink’s reliability intensified after a heated exchange between US Secretary of State Marco Rubio and Elon Musk on social media platform X. Musk suggested that Starlink was essential to Ukraine’s front-line operations, writing, “Their entire front line would collapse if I turned it off.” Polish Foreign Minister Radosław Sikorski countered that Poland funds Starlink services for Ukraine at a cost of approximately $50 million per year, adding, “If SpaceX proves to be an unreliable provider, we will be forced to look for other suppliers.”
This is not the first time questions have been raised about Starlink’s commitment to Ukraine. In February, reports indicated that US officials had discussed the possibility of restricting Ukraine’s access to the service if a deal was not reached to secure US rights to Ukraine’s rare earth minerals. More recently, Trump halted military aid to Ukraine after reopening negotiations with Russia.
Europe moves to boost defence capabilities
Trump and Musk's comments have left many European leaders concerned, leading to initiatives aimed at bolstering the EU's own defense capabilities to reduce reliance on the US. European Commission President Ursula von der Leyen recently announced an 800 billion euros collective defence budget aimed at strengthening Europe’s military capabilities.
If the EU pushes ahead with Eutelsat as a Starlink replacement, it would mark a significant shift in Europe’s strategic approach to satellite-based communications in war zones.
For now, Eutelsat’s involvement in Ukraine remains under discussion.